UPDATE 4-ABB more confident on outlook as Q2 beats poll

* Q2 net income at $623 mln, vs forecast $583 mln

* Order rise 5 percent to $7.67 bln

* Says is more confident about recovery in most markets

* CEO says ABB has further targets for acquisitions

* Shares rise 2.75 pct

(Recasts, adds shares, CEO comments, further detail)

By Catherine Bosley

ZURICH, July 22 (BestGrowthStock) – ABB (ABBN.VX: ) posted
forecast-beating quarterly profit and said it was more confident
about demand after emerging market growth fuelled sales of
industrial robots and other automated equipment.

ABB’s bullish outlook follows a similarly upbeat view from
German conglomerate Siemens (SIEGn.DE: ) and comes days after
VDMA, Europe’s largest industrial association, upped its
production outlook on booming emerging market demand.

“While we remain cautious given the mixed economic
indicators in many mature markets, the market sentiment in the
automation market is clearly the most upbeat since I’ve joined
ABB two years ago,” Chief Executive Joe Hogan said.

Orders from emerging markets accounted for 51 percent of the
second-quarter total, with orders in China, ABB’s biggest
market, up 8 percent. The increase in orders was due principally
to a 20 percent rise in the automation division, Hogan said.

ABB announced a better than expected second-quarter profit (Read more your timing to make a profit.)
of $623 million, also due to rising orders from the oil and gas
sectors in the Middle East and Africa.

“ABB was clearly able to exceed expectations,” said ZKB
analyst Richard Frei. “In addition the outlook is becoming
rosier.”

Sulzer (SUN.S: ), which like ABB makes products for the oil
and gas industry, also on Thursday reported a 4.2 percent
increase in order intake in the first six months of the year.

ABB’s shares were up 2.75 percent at 0953 GMT, outperforming
the sector index (.SXNP: ). Shares in Sulzer were flat.

POWER RECOVERY

ABB, which also competes with France’s Schneider (SCHN.PA: ),
suffered a fall in orders earlier this year in its two power
units due to lower spending by utility companies and rising
competition in Asian markets.

Hogan said price competition remained fierce. Nevertheless,
ABB expects its power units, which make products ranging from
circuit breakers to wind turbine generators, to recover later in
2010 and into 2011.

Net cash stood at $5.9 billion at the end of the quarter,
leaving the engineering group ample room for acquisitions.

The group’s chief financial officer said late last month the
group was looking into further acquisitions with a value of up
to $3 billion. [ID:nLDE65O1SV]

“We have a wide scope that we look at for industries,”
Hogan, an avid swimmer and jogger who climbed mount Kilimanjaro
with his son, said in a conference call. “We have other targets,
I can’t mention if anything imminent or not.”

In May, ABB spent more than $1 billion to buy U.S. software
group Ventyx and is also raising its stake in its Indian
subsidiary. [ID:nLDE64404U] [ID:nLDE64G0HB]

Investment Research

(Editing by Simon Jessop)

UPDATE 4-ABB more confident on outlook as Q2 beats poll