Automation giant ABB’s fiscal 2008 limped to a close as a sobering drop in fourth-quarter orders cast a pall on an otherwise strong year, the company reported on Thursday.
In the fourth quarter, ended Dec. 31, 2008, ABB recorded $7.2 billion in orders, a 19% decrease from $8.7 billion in the final quarter of 2007. Net income also plunged, to $213 million, from $1.8 billion in the year-earlier period. Revenue, meanwhile, ticked up 5% to $9.1 billion, as the company converted an earlier order backlog into dollars. The company’s earnings before interest and taxes (EBIT) sank 60% year over year to $459 million.
The EBIT total suffered from approximately $870 million related to ongoing compliance investigations, a value-added tax (VAT) charge, and restructuring-related charges, the company said.
For the year, ABB benefited greatly from its momentum across the first nine months, logging an 11% increase in orders, to $38.3 billion, while revenue shot up 20% to $34.9 billion. EBIT jumped 13% to $4.6 billion, but net income dipped slightly to $3.1 billion from $3.8 billion a year ago.