In Thursday trading, shares of ABB Ltd. (ABB, Financial) jumped almost 4% after the company announced its first-quarter results. The company registered earnings per share of 31 cents on revenue of $8.62 billion, a 9.8% year-over-year increase. The company beat earnings estimates by one cent and revenue expectations by $260 million.
Further, the cash flow from operating activities was -$518 million, compared to $509 million in the prior-year quarter. This situation was driven by the timing of employee incentive payments,which in 2017 were paid in the second quarter, timing of cash flows for large projects, payables and receivables, as well as the timing of tax payments. The company expects strong cash flow from operating activities in the next quarter and a solid cash position for the entire year.
Moreover, to maintain its capital funding structure, the company will issue $1.5 billion worth of bonds in the U.S., consisting of three tranches with maturities of two, five and 10 years. Net proceeds will be used for general corporate purposes.
“We started 2018 with order growth in all divisions, improved revenues and operating results," CEO Ulrich Spiesshofer said. "The integration of B&R is well on track and we are preparing diligently for the closing and subsequent integration of GE Industrial Solutions which we expect to happen in second quarter 2018. We are continuing to invest in sales, R&D and our leading digital solutions portfolio ABB Ability. With our streamlined and strengthened ABB and the transition year 2017 behind us, we have our focus firmly on our customers and relentless execution.”
On the other hand, shares of Sleep Number Corp. (SNBR, Financial) plunged more than 13% on the heels of the company reporting its financial results for the first quarter. The company posted earnings per share of 52 cents on revenue of $338.63 million, which declined 1.3% year over year. The company fell 4 cents short of earnings estimates and missed revenue expectations by $8.06 million.
Moreover, the gross profit fell 150 basis points from the year-ago quarter to 61.1%, dented by inefficiencies of operating two supply chains during the transition to 360 smart beds.
Looking ahead, the company reiterated its outlook for 2018 earnings per diluted share in the range of $1.70 to $2. Further, it projects 2018 capital expenditures to be about $50 million.
Disclosure: The author holds no positions in any stocks mentioned.
