The ABB Group said yesterday it recorded $1.6 billion (Dh5.87 billion) in orders last year from its operations in the Middle East and North Africa.
The company's Dubai operations move to a large 6,500-square metre facility in Al Quoz, in which its local partners have invested Dh17 million.
Faraj A. Al Jarba, senior vice president and regional manager of ABB for the Middle East and North Africa (MENA), said, "We had a good year in 2004, based on strong performance. Our region's share in ABB's global turnover is about 8 per cent. We plan to increase our region's share to 10 per cent by the end of this year.
"We also plan to increase our turnover to $2 billion (Dh7.3 billion) this year, a 25 per cent growth over the last year's turnover of $1.6 billion(Dh5.87 billion)."
Its earnings before interest and taxes (EBIT) growth last year was 40 per cent from that of 2003.
Al Jarba said his company has developed a three-year business strategy to increase its business in the MENA region.
"We have a strengthened front-end sales team which will take us closer to our valued customers. Besides, we are renewing our focus on the service sector, where we see a lot of potential for growth.
"Our future growth plan is also based on the strong market growth potential. We see a 6 to 8 per cent growth in the regional power transmission and distribution market."
Globally, ABB returned to black last year as shown in its financial results, also released yesterday.
The power and automation giant yesterday reported an EBIT of $1.08 billion (Dh3.96 billion) for the full year 2004 on solid growth in core division orders and revenues. Net income was $201 million, up $980 million compared to 2003.
EBIT in the fourth quarter more than doubled to $264 million, fuelled to a large extent by double-digit revenue growth in the core divisions, Power Technologies and Automation Technologies. Cash flow from operating activities increased 32 per cent to $880 million in the quarter, reaching $962 million for the full year.
"We met many of our objectives in a key turn-around year," said Fred Kindle, ABB President and CEO.
"We again took out costs and lifted productivity. Coupled with a recovery in most markets, we substantially increased EBIT and reported a rebound in net income of almost $1 billion.
"We faced some challenges in the year, including a delay in resolving the asbestos issue," Kindle said. "We are focused on finding timely solutions to these issues, and took steps in the fourth quarter to establish a more stable base for 2005."
To reflect the reclassification of the remaining oil, gas and petrochemicals business to continuing operations, ABB is adjusting its 2005 group EBIT margin target to 7.7 per cent from 8 per cent. The remaining growth and profitability targets are unchanged.
ABB recently won a $38 million (Dh139 million) order in India for extra high-voltage transformers and reactors which will strengthen the country's power network and help to meet growing demand.
The ABB transformers are the first key components to be delivered for a project in India to improve its power grid with a 765 kilovolt network. The contract was awarded by National Thermal Power Corporation Ltd of India.
Kindle said, he expects continued demand growth during the current year. "Besides, no further worsening of raw materials price, but rather stabilisation at high level with softening in some areas," he said.
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