ThyssenKrupp Shares Hit On Weak Adj. Earnings, Orders In Q2; Backs Outlook

(RTTNews) - Shares of ThyssenKrupp AG were losing around 14 percent in German trading after the industrial conglomerate reported Thursday sharply lower adjusted operating profit in its second quarter amid weak revenues and orders due to market conditions, even as it truned around to a net profit. Further, the company maintained its fiscal 2025 forecast.

thyssenkrupp assumes that the market environment will remain challenging yet improved compared with the 1st half of the year. However, it will still be characterized by uncertainties about future global economic growth.

Miguel López, CEO of thyssenkrupp, said, "For thyssenkrupp, fiscal year 2024/2025 is developing in line with our forecast. .. By contrast, the persistently difficult market environment is reflected in our operational figures for the second quarter. In the second half of the year, we are expecting a more stable market environment and positive effects from the measures we have initiated. We therefore confirm our full-year forecast."

Looking ahead for fiscal year 2025, thyssenkrupp continues to assume a return to profit with a figure between 100 million euros and 500 million euros, and adjusted EBIT between 600 million euros and 1 billion euros.

The company still expects sales to be down 3 percent to be flat.

In the second quarter, as expected, weak markets and high macroeconomic uncertainty in most customer groups and regions influenced the development of business performance.

In the quarter, net income after deducting minority interest was 155 million euros, compared to a loss of 78 million euros in the prior year. Earnings per share were 0.25 euro, compared to a loss of 0.13 euro per share in the previous year.

The significant improvement was supported mainly by the sale of thyssenkrupp Electrical Steel India, partly offset by impairment losses of around 90 million euros at Steel Europe.

Adjusted EBIT of the group, meanwhile, plunged to 19 million euros from the prior year's 184 million euros, reflecting lower sales and shipments and a significant reduction in capacity utilization. This was due to planned shutdowns for conversion work in the Steel Europe segment.

The difficult market situation was evident in the Automotive Technology and Materials Services segments as well, while Decarbon Technologies and Marine Systems segments grew their earnings contributions.

Group sales decreased to 8.6 billion euros from the prior year's 9.1 billion euros due to the effects of declining prices and demand.

The results reflected weaker demand in the Automotive Technology, Materials Services and Steel Europe segments and lower prices at Materials Services and Steel Europe.

However, sales of the Decarbon Technologies segment were higher than the prior year, adjusted for the sale of subsidiary thyssenkrupp Industries India.

Quarterly order intake amounted to 8.1 billion euros, down from 8.6 billion euros in the prior year.

The Marine Systems segment posted an increase in orders, mainly due to orders received by the submarine and service businesses. The Decarbon Technologies segment also performed better than the prior year.

Meanwhile, the decline in customer demand continued in the Automotive Technology segment. In the Steel Europe and Materials Services segments, further decreases were evident due to demand and price effects.

On the XETRA in Germany, thyssenkrupp shares were trading at 8.14 euros, down 13.67 percent.

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