6-K
Abb Ltd (ABLZF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE
ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2023
Commission File Number 001-16429
ABB Ltd
(Translation of registrant’s name into English)
Affolternstrasse 44, CH-8050, Zurich, Switzerland
(Address of principal executive office)
Indicate by check mark whether
the registrant files or will file
annual reports under cover of Form 20-F
or Form 40-F.
Form 20-F
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Form 40-F
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under the rules of the home country
exchange on which the registrant’s securities are traded,
as long as the report or other document
is not a press release, is not required
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a material event, has already been
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of a Form 6-K submission or other Commission
filing on EDGAR.
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Exchange Act of 1934.
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82-
This Form 6-K consists of the following:
1.
Press release issued by ABB Ltd dated
November 30, 2023, titled
“ABB Capital Markets Day 2023: Setting
new
standards”.
2
—
FROSINONE, ITALY,
NOVEMBER 30,
2023
ABB Capital Markets Day 2023:
Setting new standards
●
Future focus on consistency in operating model, accelerating growth and continuous
improvements
●
Upgraded target for long-term comparable revenue growth to 5-7%
●
Increased target for Operational EBITA margin target to 16-19%
●
More ambitious 2030 and 2050 science-based net-zero targets
ABB is hosting its Capital Markets Day today
at its Electrification site in Frosinone,
Italy. At the event,
CEO Björn Rosengren, CFO Timo Ihamuotila, as well
as the Presidents of ABB’s four business areas
will give an update on ABB’s successful transformation,
financial targets and how the company
will
benefit from key secular trends across its
business areas. In addition, ABB’s Group Head of
Sustainability will provide an update
on the company’s sustainability agenda, including
more ambitious
2030 and 2050 net-zero targets.
Björn Rosengren said: “During the transformation
period over the past three years, we aligned
the ABB
business portfolio to our purpose of enabling
a more sustainable and resource-efficient future through
our technology leadership in electrification
and automation. We have achieved strong improvements
in
financial and sustainability performance
during this phase, supported by increased
accountability,
transparency and speed thanks to our ABB
Way operating model.
“Having set new standards, we are now coming
out of this transformation period,
and the majority of our
divisions have progressed towards a strategic
growth mandate. They now focus
on capturing the full
potential of what in my view is a market sweet
spot, at the heart of the transition towards
electrification,
energy security, energy efficiency, automation and digitalization. Achieving our previous margin target a
year earlier than planned, and being a
more agile unit with fast decision-making
gives us the confidence
to formulate stronger ambitions and lift
our margin target. I am convinced that ABB
is extremely well
positioned – now and in future.”
Higher ambitions following transformation
phase
As part of its updated financial framework,
ABB is lifting its comparable revenue growth target
to
5-7 percent through the economic cycle (from
3-5 percent previously). The target
for acquired growth
remains unchanged at 1-2 percent. The company
is also raising its target for annual operational
EBITA
margin to 16-19 percent (from ≥15 percent
previously) and updating its annual ROCE
target to
>18 percent (from 15-20 percent previously).
In addition, the company is sharpening
its objective for
basic EPS growth through the economic cycle
to at least high single-digit (from
Basic EPS growth >
revenue growth previously). ABB is also confirming
its target of ~100% free cash flow conversion
to net
income.
1/3
The update in growth ambitions is based
on both external and internal factors
including accelerating
demand for sustainability-driven electrification
and automation solutions as the world moves towards
common emissions targets aligned with the
1.5°C target. Additional support for higher
growth is
grounded in new ways of working with ABB’s
divisions that are accountable for growth and
decision-making closer to the market
as well as a reshaped portfolio around sustainability
and resource
efficiency through electrification and automation.
The Group has increased the share of its
divisions that are in growth mode now comprising
approximately 70 percent of the Group’s revenues.
The focus is on both organic growth,
as well as
M&A opportunities that can fill technology
gaps, complement divisions’ offering for
high growth markets,
provide access to new geographies or
enable market consolidation. ABB is aiming
at 5 to 10 small to
mid-size bolt-on acquisitions per year.
Returns and cash generation driven by
growth ambitions
Timo Ihamuotila said: “We expect that our higher growth will
also lead to higher profitability and cash
generation. As a lever to reaching our new financial
targets, we are taking the
next step on our journey
towards further improved quality of our revenues
as well as capital efficiency and productivity. At the
same time our capital allocation priorities remain
unchanged.”
ABB will also continue to invest in digital where
it creates synergies with the company’s offering.
As of
2022, approximately 57 percent of orders
were related to the software and digitally
enabled offering.
Approximately 60 percent of R&D resources
are focused on digital solutions which the
company will
continue to strengthen with bolt-on acquisitions.
Between 2020 and 2023 ABB made
26 venture
investments in the areas of technology and
digital.
ABB is reiterating its target of maintaining
a strong investment grade rating. Its capital
allocation
principles remain unchanged: funding organic growth
through research & development, channel
and
capex investments; paying a rising, sustainable
dividend per share over time; executing
value-creating
acquisitions; and when applicable returning
additional cash to shareholders through share
buybacks. In
the past 10 years ABB has returned more than
$28 billion to shareholders – either via
dividends or
share buybacks.
Sustainability: Ambitious 2030 and 2050
science-based net-zero targets
ABB’s technologies are supporting all relevant sectors
to optimize, electrify and decarbonize,
enabling
the energy transition to a net-zero future. In line
with this mission, the company is today
providing an
update on how it is strengthening and accelerating
its sustainability agenda with new targets
and
ambitions.
Björn Rosengren said: “At ABB we have
been enabling energy efficiency and electrification for
over
140 years. Today,
we are putting our leading technologies
in electrification, automation, and
digitalization to work to accelerate the energy
transition. Our sustainability agenda
is fully aligned with
this mission. It focuses on enabling a low-carbon
society, preserving resources, and promoting social
progress in collaboration with our customers,
suppliers, and partners.”
ABB CAPITAL MARKETS DAY 2023:
SETTING NEW STANDARDS
2/3
ABB is taking a rigorous science-based
net-zero targets approach in line with
the net-zero standard of
the Science Based Targets initiative (SBTi). The company has submitted its new targets to SBTi with
validation expected in 2024. These include
1.5°C-aligned Scope 1 and 2 targets aiming
at a CO2e
emissions reduction of 80 percent by 2030
and 100 percent by 2050 versus a 2019
baseline. On a
12-month rolling average, ABB has now achieved
a 72 percent reduction in Scopes 1 and
2 CO2e
emissions versus 2019. Additionally, the company has set new Scope
3 CO2e emissions targets aiming
at a reduction of 25 percent by 2030 and
90 percent by 2050 versus a 2022 baseline.
With this more stringent approach, ABB
is moving away from former carbon
neutrality targets, which
included the use of carbon offsets.
Following the latest WBCSD avoided
emissions guidance, ABB has also
updated its ambition in this
area and aims to enable its customers to
avoid 600 megatons of CO2e emissions through
products sold
from 2022 to 2030. ABB helped its customers
avoid 70 Mt of CO2e in 2022, across
industry,
transportation, buildings, data centers,
and more.
Note to editors:
The Capital Markets Day can be followed
on the ABB Investor Relations website
from
8am CET today via the following link: https://capitalmarketsday.abb.com/page/2861310/registration
Further details on ABB’s sustainability agenda can
be found at
https://global.abb/group/en/sustainability
ABB
is a technology leader in electrification
and automation, enabling a more sustainable
and
resource-efficient future. The company’s solutions connect
engineering know-how and software to
optimize how things are manufactured, moved,
powered and operated. Building on more
than
140 years of excellence, ABB’s ~105,000 employees
are committed to driving innovations that
accelerate industrial transformation. www.abb.com
ABB CAPITAL MARKETS DAY 2023:
SETTING NEW STANDARDS
3/3
Important notice about
forward-looking information
This press release includes forward-looking
information and statements
which are based on current expectations,
estimates and projections about
the factors that may affect
our future performance,
including the economic
conditions of the regions and industries
that are major markets for
ABB. These expectations, estimates
and
projections are generally identifiable
by statements containing
words such as “anticipates”,
“expects,” “believes,”
“estimates,” “plans”, “targets”,
“aims” or similar expressions.
However, there are many risks and uncertainties,
many of which are beyond our
control, that could cause
our actual results to differ materially
from the
forward-looking information and
statements made in this press
release and which could affect our
ability to achieve
any or all of our stated targets
or anticipated transactions.
Some important factors that could
cause such
differences include, among others,
business risks associated
with the volatile global economic
environment and
political conditions, costs associated
with compliance activities, market
acceptance of new products
and services,
changes in governmental regulations
and currency exchange
rates and such other factors
as may be discussed
from time to time in ABB Ltd’s filings
with the U.S. Securities
and Exchange Commission,
including its Annual
Reports on Form 20-F. Although ABB Ltd believes that its
expectations reflected in any
such forward-looking
statement are based upon
reasonable assumptions, it
can give no assurance that
those expectations will be
achieved. The foregoing list of
factors is not exclusive and
undue reliance should not be
placed upon any
forward-looking statements, including
projections, which speak
only as of the date made.
—
For more information
please contact:
Media Relations
Phone: +41 43 317 71
11
Email: media.relations@ch.abb.com
Investor Relations
Phone: +41 43 317 71
11
Email: investor.relations@ch.abb.com
ABB Ltd
Affolternstrasse 44
8050 Zurich
Switzerland
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant
has duly caused this report to be
signed on its behalf by the undersigned,
thereunto duly authorized.
ABB LTD
Date: December 1, 2023.
By:
/s/ Ann-Sophie Nordh
Name:
Ann-Sofie Nordh
Title:
Group Senior Vice President and
Head of Investor Relations
Date: December 1, 2023.
By:
/s/ Richard A. Brown
Name:
Richard A. Brown
Title:
Group Senior Vice President and
Chief Counsel Corporate & Finance