ZURICH: ABB will reshape its engineering, procurement and construction (EPC) business — including its biggest but least profitable power grids division — by spinning off and winding down some operations, triggering fourth-quarter charges totalling $225 million.
In the Industrial Automation division, ABB’s oil & gas EPC business will be transferred into a previously announced joint venture controlled by Saudi-based Arkad Engineering and Construction in a deal now expected to close this month.
CEO Ulrich Spiesshofer described the reshaping of its business as ABB’s final step in a year of transition that would lead into a 2018 when it would benefit from a strengthening economy.
“We will always run the business in a way that we are responsibly managing capacity in line with market development,” he told reporters on a call, but noted economic conditions were likely to be brighter next year than in 2017.
Last month, ABB said it would revamp its global power grids operations as it responds to the division’s sluggish profitability and falling orders.
The move came as ABB sought to justify its decision last year to reject calls from Cevian Capital, its second-largest shareholder, to spin off power grids, which has suffered a 9 percent drop in orders in 2017.
In the Power Grids division, which also makes electrical substations, ABB will form a joint venture with SNC-Lavalin for electrical substation EPC projects, the Swiss technology group said on Wednesday.
Canadian-based SNC-Lavalin will have the controlling interest in the venture, it said.
In the Robotics and Motion division, ABB is winding down its turnkey full train retrofit business.
“The fourth quarter 2017 results of Power Grids and Robotics and Motion are each expected to be impacted by approximately $75 million on operational EBITA. The transfer of the turnkey oil & gas EPC business into the JV with Arkad is expected to result in a non-operational pre-tax charge to net income of approximately $75 million,” the company said.
Spiesshofer said he did not expect negative impact on jobs.
ABB is trying to shift its focus to higher-margin services.
Its four divisions cover electrification products, robotics, industrial automation and power grids. Power grids accounted for around 30 percent of 2016 sales, electrification products 28 percent, robotics 23 percent and industrial automation 19 percent.
ABB shares fell 0.4 percent in early trading, while the Stoxx European industry sector index was little changed.
“We believe that the indicated completion of the (EPC) business model change will be supportive for sales growth rates as well as profitability,” Baader Helvea analyst Guenter Hollfelder, who rates the stock “hold,” said in a note.
ABB will report these businesses as a non-core operating unit which will manage its backlog of existing business. The new unit will report to finance chief Timo Ihamuotila from the start of next year.
ABB to transfer energy EPC business to Saudi contractor
ABB to transfer energy EPC business to Saudi contractor
Saudi Maaden reports 156% profit surge to $2bn on strong commodity prices, record production
RIYADH: Saudi mining and metals company Maaden has reported a 156 percent jump in its net profit attributable to shareholders for 2025, driven by higher commodity prices, record production volumes, and a one-off bargain purchase gain.
The state-backed giant posted a net profit of SR7.35 billion ($1.95 billion) for the full year 2025, an increase from SR2.87 billion in the previous year. The firm’s revenue surged by 19 percent to SR38.58 billion, up from SR32.55 billion in 2024.
This comes as Saudi Arabia steps up efforts to expand its mining sector as a pillar of economic diversification, encouraging international participation and private investment to unlock the Kingdom’s estimated $2.5 trillion in untapped mineral resources under Vision 2030.
In a statement on Tadawul, the company said: “Performance was led by record phosphate production, near record aluminum production, an increase in all three of Maaden’s main output commodity prices.”
The performance was also fueled by a 60 percent increase in gross profit, which reached SR14.79 billion. In its annual results announcement, Maaden attributed the top-line growth to “higher commodity market prices for phosphate, aluminum and gold business units,” as well as increased sales volumes in its phosphate and aluminum segments. This was partially offset by slightly lower sales volume in the gold unit.
Maaden’s CEO, Bob Wilt, hailed 2025 as a transformative year for the company, marked by strategic growth and operational excellence. “This was a great year for Maaden’s strategic growth. We delivered strong financial results and sustained operational excellence across the business,” he said in a statement.
“This was driven by growth in production across all businesses, including record-breaking DAP (di-ammonium phosphatevolumes), disciplined cost control across and a clear commitment to our role as a cornerstone of the Saudi economy,” Wilt added.
Profitability was further bolstered by an increased share of net profit from joint ventures and an associate. This included a one-off bargain purchase gain of SR768 million related to Maaden’s investment in Aluminium Bahrain B.S.C. The company also benefited from lower finance costs.
The fourth quarter of 2025 was strong, with Maaden swinging to a net profit of SR1.67 billion, compared to a loss of SR106 million in the same period of the prior year. Quarterly revenue rose 7 percent to SR10.64 billion.
The firm achieved record production of di-ammonium phosphate, reaching 6.72 million tonnes for the year, a 9 percent increase. Aluminum production remained near-record levels, while the company added a net 7.8 million ounces to its reportable gold mineral resources through discovery and resource development.
The phosphate division saw sales jump 17 percent to SR20.77 billion, with the earnings before interest, taxes, depreciation, and amortization margin expanding to 47 percent. The aluminum business reported a 9 percent increase in sales to SR10.99 billion, with EBITDA more than doubling in the fourth quarter.
Looking ahead, Wilt emphasized that the pace of growth will accelerate as the company advances key initiatives, including the Phosphate 3 Phase 1 and Ar Rjum projects, which remain on budget and schedule. Maaden has also secured a gas supply for its future Phosphate 4 project.
“This pace of growth will only accelerate. Not only as we advance projects and increase the scale of our exploration program, but as we continue to grow production and implement technology that will further modernize, streamline and unlock value,” Wilt added.
Earnings per share for the year rose sharply to SR1.91, up from SR0.78 in 2024. Total shareholders’ equity increased by 18.7 percent to SR61.59 billion.
