ZURICH, Nov 18 (Reuters) - ABB raised its profitability margin goal on Tuesday as the slimmed-down Swiss engineering group prepares to concentrate on electrification and industrial automation.
The company, which is selling its industrial robots business to SoftBank Group for $5.4 billion, targets an operational earnings before interest, tax and amortisation margin of 18-22% over the next few years, up from its previous goal of 16-19%.
ABB, whose products are used to provide electricity to factories and buildings, as well as in mines, ports and to power cruise liners, confirmed its current sales growth targets.
ABB shares, however, fell 2.3% in pre-market trade.
"There may have been higher expectations," analysts at Zuercher Kantonalbank said.
The Zurich-based company expects to increase its annual sales by 5-7% on a comparable basis, and aims for additional sales growth from acquisitions of 1-2% per year, ABB said, keeping the same target as previously.
Larger deals would come on top of the normal flow of small to mid-size deals, the company said.
ABB has recently seen a surge in growth, helped by the products it supplies for the data center market used to power artificial intelligence.
Competitor Siemens last week announced a target in a similar range, saying the German company expects its sales to rise by 6-9% in the mid term.
ABB aims to invest in the field of electrification and automation, CEO Morten Wierod told Reuters in October.
Reporting by Ariane Luthi, Editing by Friederike Heine and Susan Fenton
Source: Reuters