The following are definitions of key financial measures used to evaluate ABB’s operating performance. These financial measures are referred to in this Annual Report and are not defined under United States generally accepted accounting principles (U.S. GAAP).
While ABB’s management believes that the financial measures defined below are useful in evaluating ABB’s operating results, these measures should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with U.S. GAAP.
For a full reconciliation of ABB’s non-GAAP measures, please refer to ABB Q4 2014 Supplemental financial information at http://new.abb.com/investorrelations/financial-results-and-presentations/quarterly-results-and-annual-reports-2014 The like-for-like growth rates of revenues and orders are calculated by adjusting reported revenues and orders, in both the current and comparable periods, for the effects of currency translation and portfolio changes. The adjustment for portfolio changes is calculated as follows: where the results of any business acquired or divested have not been consolidated and reported for the entire duration of both the current and comparable periods, the reported revenues and orders of such business are adjusted to exclude the revenues and orders of any corresponding quarters which are not comparable when computing the like-for-like growth rate. In addition, certain other adjustments, which affect the business portfolio but do not qualify as a divestment, are treated in a similar manner to a divestment. We do not adjust for portfolio changes where the business acquired or divested has annual revenues of less than $50 million.
Operational EBITDA margin is Operational EBITDA as a percentage of Operational revenues.
Operational EBITDA represents Income from operations excluding depreciation and amortization, restructuring and restructuring related expenses, gains and losses from sale of businesses, acquisition-related expenses and certain non-operational items, as well as foreign exchange/commodity timing differences in income from operations consisting of:
(i) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (ii) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized and (iii) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities).
Operational revenues are total revenues adjusted for foreign exchange/commodity timing differences in total revenues of: (i) unrealized gains and losses on derivatives, (ii) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized and (iii) unrealized foreign exchange movements on receivables (and related assets).
Operational EBITA margin is Operational EBITA as a percentage of Operational revenues.
Operational earnings before interest, taxes and acquisition-related amortization (Operational EBITA) represents Income from operations excluding acquisition-related amortization (as defined below), restructuring and restructuring related expenses, gains and losses from sale of businesses, acquisition-related expenses and certain non-operational items, as well as foreign exchange/commodity timing differences in income from operations consisting of: (i) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (ii) realized gains and losses on deriv-atives where the underlying hedged transaction has not yet been realized, and (iii) unrealized foreign exchange move-ments on receivables/payables (and related assets/liabilities).
Amortization expense on intangibles arising upon acquisitions.
Cash return on invested capital is calculated as Adjusted cash return divided by Capital invested.
Adjusted cash return is calculated as the sum of (i) net cash provided by operating activities and ii) interest paid.
Capital invested is the sum of (i) Adjusted total fixed assets, (ii) Net working capital and (iii) Accumulated depreciation and amortization.
Adjusted total fixed assets is the sum of (i) property, plant and equipment, net, (ii) goodwill, (iii) other intangible assets, net, and (iv) investments in equity-accounted companies less (v) deferred tax liabilities recognized in certain acquisitions.
Net working capital is the sum of (i) receivables, net, (ii) inventories, net, and (iii) prepaid expenses; less (iv) accounts payable, trade, (v) billings in excess of sales, (vi) advances from customers, and (vii) other current liabilities (excluding Like-for-like Growth Rates
Operational EBITDA margin Operational EBITDA
Operational revenues
Operational EBITA margin Operational EBITA
Acquisition-related amortization
Cash return on invested capital (CROI)
Adjusted cash return Capital invested
Adjusted total fixed assets
Net working capital
Investor information
During 2014, the price of ABB Ltd shares listed on the SIX Swiss Exchange decreased 10 percent, while the Swiss Performance Index increased 13 percent. The price of ABB Ltd shares on NASDAQ OMX Stockholm decreased 2 percent, compared to the OMX 30 Index, which increased 10 percent. The price of ABB Ltd American Depositary Shares traded on the New York Stock Exchange decreased 20 percent compared to the Dow Jones Industrial Index, which increased by 8 percent.
Source: Bloomberg
2014
SIX Swiss Exchange (CHF)
NASDAQ OMX Stockholm (SEK)
New York Stock Exchange (USD)
High 24.75 175.70 27.09
Low 19.16 145.70 20.37
Year-end 21.14 165.90 21.15
Average daily traded number of shares, in millions 6.19 1.65 1.85
Source: Bloomberg
On December 31, 2014, ABB Ltd’s market capitalization based on outstanding shares (total number of outstanding shares: 2,258,899,625) was approximately CHF 48 billion ($48 billion, SEK 375 billion).
As of December 31, 2014, the total number of shareholders directly registered with ABB Ltd was approximately 165,000.
In addition, another 225,000 shareholders hold shares indirectly through nominees. In total, ABB has approximately 390,000 shareholders.
As of December 31, 2014, Investor AB, Stockholm, Sweden, owned 199,965,142 shares of ABB Ltd, corresponding to 8.6 percent of total capital and votes of ABB Ltd as registered in the Commercial Register on December 31, 2014.
As of July 25, 2011, BlackRock Inc., New York, USA, owned 69,702,100 shares of ABB Ltd, corresponding to 3.0 per-cent of total capital and votes of ABB Ltd as registered in the Commercial Register on December 31, 2014. To the best of ABB’s knowledge, no other shareholder held 3 percent or more of the total voting rights as of December 31, 2014.
With respect to the year ended December 31, 2014, ABB Ltd’s Board of Directors has proposed to distribute a total of CHF 0.72 per share to shareholders, comprising of a dividend of CHF 0.55 paid out of ABB Ltd’s capital contribution reserves and of CHF 0.17 by way of a nominal value reduction (reduction in the par value of each share by CHF 0.17 from CHF 1.03 to CHF 0.86). These distributions are subject to approval by shareholders at ABB Ltd’s 2015 Annual General Meeting. The proposal is in line with the company’s dividend policy to pay a steadily rising, sustainable dividend over time.
Both forms of payment would be exempt from Swiss withholding tax.
For the dividend paid from ABB’s capital contribution reserve, the ex-dividend date would be May 4, 2015, for American Depositary Shares traded on the New York Stock Exchange in the U.S., and May 5, 2015, for shares traded on the SIX Swiss Exchange and on the NASDAQ OMX exchange in Sweden. The payout dates would be May 7, 2015, for shares traded on the SIX Swiss Exchange, May 11 for shares traded on the NASDAQ OMX exchange in Sweden, and May 14 for American Depositary Shares traded on the New York Stock Exchange in the U.S.
For the dividend from the nominal value reduction, the ex-dividend and payout dates in Switzerland are expected in July 2015, in line with Swiss regulatory processes. Further information will be made available on ABB’s website in due course.
In September 2014, ABB announced a $4 billion share buyback program. As of February 28, 2015, ABB has purchased under the program a total of approximately 45 million shares for approximately $980 million. Further information can be found at www.abb.com/investorrelations.
ABB Ltd share price trend during 2014
Share price
(data based on closing prices)
Market capitalization
Shareholder structure
Major shareholders
Dividend proposal and share buyback
2014 2013 2012
Dividend per share (CHF) 0.72(1) 0.70 0.68
Par value per share (CHF) 1.03 1.03 1.03
Votes per share 1 1 1
Basic earnings per share (USD)(2) 1.13 1.21 1.18
Total ABB stockholders’ equity per share (USD)(3) 7.20 8.12 7.36
Cash flow from operations per share (USD)(2) 1.68 1.59 1.65
Dividend payout ratio (%)(4) 64% 65% 63%
Weighted-average number of shares outstanding (in millions) 2,288 2,297 2,293
Proposed by the Board of Directors and subject to approval by shareholders at the Annual General Meeting on April 30, 2015, in Zurich, Switzerland Calculation based on weighted-average number of shares outstanding
Calculation based on the number of shares outstanding as of December 31, 2014
Dividend per share (converted to U.S. dollars at year-end exchange rates) divided by basic earnings per share
The 2015 Annual General Meeting of ABB Ltd will be held at 10:00 a.m. on Thursday, April 30, 2015, at the Messe Zurich hall in Zurich-Oerlikon, Switzerland. The Annual General Meeting will be held principally in German and will be simulta-neously translated into English and French. Shareholders entered in the share register, with the right to vote, by April 22, 2015, are entitled to participate in the Annual General Meeting.
Holders of registered shares of ABB Ltd will receive their admission cards on request using the reply form enclosed with the invitation. The reply form or a corresponding notification must reach the company no later than April 24, 2015.
For technical reasons, notifications arriving after that date can no longer be taken into consideration. The full text of the invitation in accordance with Article 700 of the Swiss Code of Obligations will be published in the Schweizerisches Handelsamtsblatt around April 1, 2015.
For shareholders in Sweden an Information Meeting will be held in Västerås, Sweden, on May 04, 2015, at 4:30 p.m.
First-quarter 2015 results April 29
ABB Ltd Annual General Meeting, Zurich April 30
ABB Ltd Information Meeting, Västerås May 04
Second-quarter 2015 results July 23
Third-quarter 2015 results October 21
Key data
(1) (2) (3) (4)
ABB Ltd Annual General Meeting
Admission cards
ABB shareholders’ calendar 2015
ABB Ltd is listed on the SIX Swiss Exchange, NASDAQ OMX Stockholm and the New York Stock Exchange.
CH 001 222 171 6
SIX Swiss Exchange ABBN
NASDAQ OMX Stockholm ABB
New York Stock Exchange (NYSE) ABB
SIX Swiss Exchange ABBN VX
NASDAQ OMX Stockholm ABB SS
New York Stock Exchange (NYSE) ABB US
SIX Swiss Exchange ABBN.VX
NASDAQ OMX Stockholm ABB.ST
New York Stock Exchange (NYSE) ABB.N
Long-term corporate credit rating A Long-term senior unsecured debt A Short-term corporate credit rating A–1 Outlook: Stable
Long-term senior unsecured rating A2
Short-term debt rating Prime-1
Outlook: Stable
These credit ratings are subject to revision at any time. ABB does not have any other agreements with internationally recognized statistical rating organizations to provide long-term and short-term credit ratings.
Outstanding public bonds, as of February 28, 2015, are listed in the table below.
Bondholder Information
Issuer Issued Principal Amount Coupon Due ISIN
ABB Ltd CHF 500 million 1.25% 10/11/2016 CH0139264961
ABB Ltd CHF 350 million 1.50% 11/23/2018 CH0146696528
ABB Ltd CHF 350 million 2.25% 10/11/2021 CH0139265000
ABB Finance (Australia) Pty Limited AUD 400 million 4.25% 11/22/2017 AU3CB0202216
ABB Finance (USA) Inc. USD 500 million 1.625% 05/08/2017 US00037BAA08
ABB Finance (USA) Inc. USD 1,250 million 2.875% 05/08/2022 US00037BAB80
ABB Finance (USA) Inc. USD 750 million 4.375% 08/08/2042 US00037BAC63
ABB Finance B.V. EUR 1,250 million 2.625% 03/26/2019 XS0763122578
ABB Treasury Center (USA), Inc. USD 600 million 2.50% 06/15/2016
144A: US00038AAA16 RegS: USU00292AA73
ABB Treasury Center (USA), Inc. USD 650 million 4.00% 06/15/2021
144A: US00038AAB98 RegS: USU00292AB56
Thomas & Betts Corporation USD 250 million 5.625% 11/15/2021 US884315AG74
Stock exchange listings
The global ISIN code for the ABB share Ticker symbols for ABB Ltd
Ticker symbols for ABB Ltd at Bloomberg
Ticker symbols for ABB Ltd at Reuters
Credit rating for ABB Ltd as of February 28, 2015 Standard & Poor’s
Moody’s
Bondholder information