Thursday, November 24, 2016

Low steel prices spoil Thyssenkrupp business – FAZ – Frankfurter Allgemeine Zeitung

The long weak steel prices weighed on the recovery in the industrial group Thyssenkrupp-sensitive. In the end of September, the past fiscal year, the operating profit (adjusted Ebit) dropped by twelve percent to just under EUR 1.5 billion, as the company announced on Thursday in Essen. Savings of almost one billion Euro stabilized the result.

The sales receded by 8 percent to 39.3 billion euros. The bottom line the group earned 296 million Euro, four per cent fewer than a year earlier. The Figures were almost in line with expectations. The dividend wants to keep Thyssenkrupp 15 cents per share, however, is only stable; analysts had expected an increase.

The proposal for the dividend payment is taken into account, as Thyssnekrupp the financial position explained – among other things. The has worsened again. The equity decreased in the twelve months to end-September, more than a fifth to € 2.6 billion. This was mainly due to the fact that the group had to increase because of the prevailing low interest rates, its provisions for pension payments. The debt rose by three percent to 3.5 billion euros.

light look at the cash flow

Thus, the ratio of debt to equity in the case of well 134 percent, around 30 percentage points higher than a year earlier. For years, Thyssenkrupp is struggling with the major brand of 150 percent. This value is exceeded, banks can terminate some credit agreements. Thyssenkrupp stressed in the face of eight billion Euro to be at any time available funds are invested soundly financed.

A light view, the inflow of funds from current operations (cash flow). This grew by 72 percent to 198 million euros. This means that Thyssenkrupp has taken more money than is spent. In the fiscal year 2014/15 was managed for the first time in nine years. Most recently, the Board of management even in the best case, had submitted a balanced cash flow.

Originally wanted to increase the group’s operating profit to 1.9 billion euros. Due to the sharp decline in steel prices until far into the past fiscal year, the Management lowered but already in may, its forecast to just 1.4 billion euros. In the new fiscal year, the Board of management is now aiming for an adjusted profit before interest and taxes of around EUR 1.7 billion. Alone, 850 million Euro is to deliver further austerity measures.

problem child U-Boot-division

As a support in the Elevator business and the manufacturing of components which increased both their income proved to be once again. In contrast, the large-scale plant construction, the U-boat division improved, due to weak orders to a child and earned significantly less. A rehabilitation programme is to bring improvement. However, the group to which the originally designated Manager. This had taken a few days ago his hat, because he had violated the group’s own rules of good corporate governance.

By 36 per cent fell even winning the European steel division. They had long been suffering from the massive imports from China triggered the price decline. Recently, prices have recovered, but also thanks to the introduction of punitive tariffs in the EU, so that the prospects for this business, something will have brightened.

More about

For years, the division is already struggling with the crisis in the sector. The Board is looking now actively according to any one of liberation. In the summer, the company confirmed talks over a merger of its local Steel sector the European steel business of Indian industrial conglomerate Tata. Since then, listening to little but was.

Meanwhile, reduced the Brazilian problem is the factory steel its loss for the year. The much to expensive construction of the plant had overthrown Thyssenkrupp a few years ago in a deep crisis. Meanwhile, the plant runs more stable. In the long term, Thyssenkrupp wants to separate from the plant. Recently there had been rumors of a sale to the Argentine steel group Ternium.


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