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ABB shares under pressure before release of half-year results

Financial figures from ABB will come under the spotlight on Tuesday

(Keystone Archive)

Shares in the Swedish-Swiss engineering technology group fell almost four per cent on Monday on the eve of the release of half-year financial figures. The share price fell to SFr22.85 in early trading on the back of a negative report on the company in Monday's online edition of the Wall Street Journal.

The newspaper reported a lack of confidence in the company's management and a declining performance in key markets.

In April, the group posted a lower than expected six per cent rise in first quarter earnings and warned of a difficult year for the company. Profits have also been hit by the slowdown in the US economy.

ABB has also received a raft of profit downgrades from brokers who agree that the current economic climate could force some kind of restructuring by the end of the year. The company has already announced a freeze in new positions.

ABB is just one of several companies to release half-year figures this week as the financial reporting season hots up.

Numbers from the Geneva-based pharmaceuticals company, Serono, are also out on Tuesday. The company reported a 37 per cent increase in net profit over the first quarter at SFr124 million ($72 million) in a strong start to the business year.

Since then, Serono has been engaged in a fierce battle with rival United States group, Biogen, over alternative multiple sclerosis treatments.

Analysts say that if Biogen can delay in US courts Serono's launch of its Rebif treatment in the American market, it would undermine Serono's earnings potential.

Also reporting second quarter figures on Tuesday is canton Vaud based technology firm, Logitech. The company, which produces Internet video cameras, mice, trackballs and keyboards revealed a strong performance in its last results with net income over the previous financial year up 61 per cent at SFr83.6 million ($48.4 million). At that time, Logitech promised a 25 per cent increase in sales over the next financial year.

On Wednesday, interim results are out from the Basel-based Lonza group. Its chief executive, Sergio Marchionne, is expected to release more details on the group's plans to transform itself into a life sciences group.

In June, Marchionne admitted that the company had been in talks with four possible buyers for its energy business and said more details could be forthcoming at the end of July.

The corporate news continues to flow on Thursday, as the world's largest temporary staff placement firm, Adecco, discloses its second quarter earnings.

Net profit at the Swiss company rose 30 per cent in the first three months. However, Adecco warned that activity in key markets was expected to slow over the remainder of the year.

Swissinfo with agencies


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