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ABB Finance (USA) Inc.
Financial Statements
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FINANCIAL STATEMENTS 2024 |
ABB FINANCE (USA) INC . |
Contents
3 Independent Auditors' Report
- Balance Sheets
- Statements of Income
- Statements of Changes in Stockholder's Equity
- Statements of Cash Flows
- Notes to Financial Statements
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FINANCIAL STATEMENTS 2024 |
A B B FIN A NCE (US A) INC . |
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KPMG LLP
Suite 1000
620 S. Tryon Street
Charlotte, North Carolina 28202-1842
Independent Auditors' Report
The Board of Directors
ABB Finance (USA) Inc.:
Opinion
We have audited the financial statements of ABB Finance (USA) Inc. (the Company), which comprise the balance sheets as of December 31, 2024 and 2023, and the related statements of income, changes in stockholder's equity, and cash flows for the years then ended, and the related notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended in accordance with U.S. generally accepted accounting principles.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with U.S. generally accepted accounting principles, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are issued.
Auditors' Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
- Exercise professional judgment and maintain professional skepticism throughout the audit.
KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.
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FINANCIAL STATEMENTS 2024 |
ABB FINANCE (USA) INC . |
- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.
- Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
Charlotte, North Carolina
April 21, 2025
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FINANCIAL STATEMENTS 2024A B B FIN A NCE (US A) INC .5
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Balance Sheets
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December 31 (USD in thousands, except per share data) |
2024 |
2023 |
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Current assets: |
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Accounts receivable - affiliated companies |
3,390 |
1,696 |
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Accrued interest receivable - affiliated companies |
7,524 |
7,576 |
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Loans - affiliated companies |
13,995 |
12,232 |
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Total current assets |
24,909 |
21,504 |
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Non-current assets: |
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Loans - affiliated companies |
965,779 |
965,779 |
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Total non-current assets |
965,779 |
965,779 |
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Total assets |
990,688 |
987,283 |
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Current liabilities: |
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Accounts payable - affiliated companies |
3,390 |
1,695 |
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Accrued interest payable - third parties |
7,364 |
7,365 |
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Total current liabilities |
10,754 |
9,060 |
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Non-current liabilities: |
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Debt - third parties |
973,145 |
972,252 |
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Total non-current liabilities |
973,145 |
972,252 |
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Stockholder's equity: |
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Common stock, par value $0.01 per share; 1,000 shares |
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authorized, issued, and outstanding |
- |
- |
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Additional paid-in capital |
3,051 |
2,879 |
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Retained earnings |
3,738 |
3,092 |
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Total stockholder's equity |
6,789 |
5,971 |
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Total liabilities and stockholder's equity |
990,688 |
987,283 |
See accompanying notes.
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FINANCIAL STATEMENTS 2024 |
ABB FINANCE (USA) INC . |
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Statements of Income
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Year ended December 31 (USD in thousands) |
2024 |
2023 |
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Revenues: |
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Interest income - affiliated companies |
42,907 |
42,720 |
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Total revenues |
42,907 |
42,720 |
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Expenses: |
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Interest expense - third parties |
41,712 |
41,689 |
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Amortization of fees on bond issuance |
377 |
362 |
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Other (income)/expense, net |
- |
- |
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Total expenses, net |
42,089 |
42,051 |
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Income before taxes |
818 |
669 |
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Provision for income taxes |
172 |
140 |
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Net income |
646 |
529 |
See accompanying notes.
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FINANCIAL STATEMENTS 2024 |
A B B FIN A NCE (US A) INC . |
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Statements of Changes in
Stockholder's Equity
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Additional |
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Common |
Paid-in |
Retained |
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Years ended December 31, 2024 and 2023 (USD in thousands) |
Stock |
Capital |
Earnings |
Total |
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Balance at December 31, 2022 |
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2,739 |
2,563 |
5,302 |
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Contribution from Parent |
- |
140 |
- |
140 |
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Net income |
- |
- |
456 |
456 |
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Balance at December 31, 2023 |
- |
2,879 |
3,092 |
5,971 |
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Contribution from Parent |
- |
172 |
- |
172 |
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Net income |
- |
- |
646 |
646 |
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Balance at December 31, 2024 |
- |
3,051 |
3,738 |
6,789 |
See accompanying notes.
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FINANCIAL STATEMENTS 2024 |
ABB FINANCE (USA) INC . |
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Statements of Cash Flows
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Year ended December 31 (USD in thousands) |
2024 |
2023 |
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Operating activities: |
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Net income |
646 |
592 |
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Adjustments to reconcile net income to net cash provided by operating activities: |
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Non-cash charges in lieu of income taxes |
172 |
140 |
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Non-cash charges for amortization of deferred costs |
377 |
362 |
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Non-cash charges for amortization of discount on debt |
516 |
492 |
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Net increase in accounts receivable - affiliated companies |
(1,694) |
- |
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Net (increase)/decrease in interest receivable - affiliated companies |
52 |
(18) |
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Net decrease in interest payable - affiliated companies |
1695 |
- |
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Net (decrease) ub accrued interest payable - third parties |
(1) |
- |
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Net cash provided by operating activities |
1,763 |
1,505 |
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Investing activities: |
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Net increase in short-term loans - affiliated companies |
(1,763) |
(1,505) |
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Net cash provided by/(used in) investing activities |
(1,763) |
(1,505) |
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Financing activities: |
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Net cash used in financing activities |
- |
- |
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Change in cash and cash equivalents |
- |
- |
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Supplemental disclosures of cash flow information: |
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Interest paid |
41,197 |
41,197 |
See accompanying notes.
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FINANCIAL STATEMENTS 2024 |
A B B FIN A NCE (US A) INC . |
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Notes to Financial Statements
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Note 1
Organization and Operations
ABB Finance (USA) Inc. (the Company) is a wholly-owned subsidiary of ABB Holdings Inc. (the Parent) and a member of the worldwide group of related companies of ABB Ltd, Zurich, Switzerland (the ABB Group). The Company acts as a financial intermediary for the ABB Group, primarily in the United States (U.S.).
Debt securities issued by the Company are guaranteed by ABB Ltd (the Guarantor) whereby the Guarantor irrevocably and unconditionally guarantees to the holders of notes or debt issued by the Company, the due and punctual payment of principal, premium (if any) and interest from time to time payable by the Company in respect of such debt as and when the same shall become due.
As a result of the above-noted credit support instrument (the Guarantee), interest rates on debt instruments issued by the Company are likely to be lower. Therefore, effective May 2012, the Company entered into a Debt Compensation Agreement (the Agreement) with ABB Ltd. The Agreement specifies that as long as the debt remains outstanding, the Company shall pay a fee to ABB Ltd as compensation for the benefit arising to the Company from the lower interest rates and reduced interest expense in respect to each Debt Instrument. For the year ended December 31, 2024, the Company's expense under the Agreement was $6.8 million (2023: $6.8 million), reported in "Other (income)/expense, net" in the Statements of Income. As of December 31, 2024, $3.4 million (2023: $1.7 million) of this expense was due to the Guarantor and reported in "Accounts payable - affiliated companies." In 2024, the total fee of $6.8million (2023: $6.8 million) was re-charged to another ABB Group company and the corresponding income was reported in "Other (income)/expense, net" in the Statements of Income.
The Company is a designated issuer under the ABB Group's Euro Medium Term Note program that allows the issuance of up to the equivalent of USD 8 billion in certain debt instruments. The terms of the program do not obligate any third party to extend credit to the Company and the terms and possibility of issuing any debt under the program are determined with respect to, and as of the date of issuance of, each debt instrument. No notes were issued by the Company under the program in 2024 or 2023.
The Company has evaluated subsequent events up to the close of business on April 21, 2025, the date of issuance of these financial statements.
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FINANCIAL STATEMENTS 2024 |
ABB FINANCE (USA) INC . |
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Note 2
Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed in the preparation of these financial statements:
Basis of Presentation
The financial statements are prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) and are presented in U.S. dollars ($) unless otherwise stated.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make assumptions and estimates that directly affect the amounts reported in the financial statements and notes. The accounting estimates that require the Company's judgment involve discount rates used to determine the fair value of loans.
The actual results and outcomes may differ from the Company's estimates and assumptions.
Fair Value Measures
The Company uses fair value measurement principles to record certain financial assets and liabilities on a recurring basis and to determine the fair value disclosures for certain financial instruments carried at amortized cost in the financial statements.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Company applies various valuation techniques, including the market approach (using observable market data for identical or similar assets and liabilities) and the income approach (discounted cash flow models). Inputs used to determine the fair value of assets and liabilities are defined by a three-level hierarchy, depending on the reliability of those inputs. The Company categorized its financial assets and liabilities measured at fair value within this hierarchy, based on whether the inputs to the valuation technique are observable or unobservable. An observable input is based on market data obtained from independent sources, while the unobservable input reflects the Company's assumptions about market data.
The levels of the fair value hierarchy are as follows:
Level 1: Valuation inputs consist of unadjusted quoted prices in an active market for identical assets or liabilities (observable quoted prices).
Level 2: Valuation inputs consist of other observable inputs (other than Level 1 inputs), such as actively quoted prices for similar assets, quoted prices in inactive markets, interest rate yield curves, credit spreads, or inputs derived from other observable data by interpolation, correlation, regression or other means. The adjustments applied to quoted prices or the inputs used in valuation models may be both observable and unobservable. In these cases, the fair value measurement is classified as Level 2 unless the unobservable portion of the adjustment or the unobservable input to the valuation model is significant, in which case the fair value measurement will be classified as Level 3.
Level 3: Valuation inputs are based on the Company's own assumptions of relevant market data.
Whenever quoted prices involve bid-ask spreads, the Company ordinarily determines fair values based on mid-market quotes.
Attachments
Disclaimer
ABB Ltd. published this content on April 23, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 23, 2025 at 16:58 UTC.
