By John Revill
ZURICH (Reuters) -ABB expects to increase its annual sales by 5% this year, the Swiss engineering group said on Thursday, despite ongoing geopolitical tensions weighing on market sentiment.
The maker of industrial robots and electrical engines said its strategy of making products locally helped it withstand problems like the current Red Sea shipping crisis as well as the U.S-Chinese rivalry, Chief Executive Bjorn Rosengren said.
The Red Sea crisis was having no material effect on the company, Rosengren said, while long-term trends like industry's green energy transition were also so well established that they would not be derailed by the U.S. presidential election this year, he said.
"It's a pretty cumbersome situation out there, especially between the U.S. and China, but not only that, we have two wars close to Europe which is not making life easier for anyone," Rosengren told reporters after ABB (ST:ABB) reported fourth-quarter results.
"It's hanging like a wet towel over the whole market at the moment," he said.
Increased suspicion between Washington and Beijing has led to ABB's China business being scrutinised by two U.S. Congress committees dedicated to investigating security threats and risks.
ABB reported a 5% increase in sales to $8.25 billion in the three months to the end of December, beating analyst forecasts for $8.10 billion.
Core operating profit (operational earnings before interest, taxes and amortisation increased 16% to $1.33 billion, roughly in line with forecasts for $1.35 billion in a company gathered consensus.
ABB shares were up 1.5% in mid-morning trading.
Rosengren said he was confident about taking on more orders in 2024, while ABB also worked through its order backlog which now stands at $21.6 billion.
As a big supplier to factories and transport infrastructure, ABB's results are seen as a signifier for the health of the broader global economy.
Rosengren declined to comment on how this year's U.S. presidential election could affect the upturn in the United States, ABB's biggest market with 26% of its sales.