ABB may list electric car charging business, Q1 profit jumps by a third

ZURICH: ABB said on Tuesday it is considering a stock market listing for its electric vehicle charging business, as profit at the Swiss engineering group jumped by a third to return to pre-pandemic levels in the first quarter.

The maker of industrial motors and drives has already begun carving out its e-mobility business into a separate legal entity ahead of a potential initial public offering (IPO).

"These steps will allow us to prepare for a possible public listing, creating a platform for accelerated growth and value creation in this business," Chief Executive Bjorn Rosengren said.

The business, which builds fast electric chargers for cars and buses, had revenues of $220 million in 2020, and has recorded an average growth rate of 50% over the past five years.

It has so far delivered 400,000 electric chargers to 85 countries, with its biggest market Europe buying 54%, followed by the Americas with 29%.

ABB reported a 34% rise in net profit to $502 million in the first quarter of 2021 from the year earlier period as customers rebuilt inventories, close to the $535 million posted for the first quarter of 2019.

The company said it expects orders and revenues to grow by more than 10% during the second quarter with an operational profit margin of 14%.

Shares were indicated 0.6% higher in premarket activity.

ABB had already announced earlier this month an 11% rise in first-quarter revenues and an improvement in its profit margin.

It said it had not been affected in the first quarter by the global shortage of semiconductor chips, although it was seeing tighter supplies like many other technical firms.

Rosengren said the sale of three divisions ABB put on the block last year was progressing well, with the first deal expected to be completed during the second half of this year.

That is likely to be for clutch and transmission manufacturer Dodge, which has annual sales of $575 million and could carry a price tag of around $1.5 billion.

ABB is also seeking buyers for its power conversion and turbocharging businesses as Rosengren, who took charge last year, reshapes the company.