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Thyssenkrupp swings to fiscal Q2'19 loss in wake of failed Tata Steel JV

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Thyssenkrupp swings to fiscal Q2'19 loss in wake of failed Tata Steel JV

Thyssenkrupp AG swung to a loss of €99 million from a profit of €240 million for its fiscal second quarter in the wake of its failed European steel joint venture with Tata Steel Ltd.

The result did not include the financial hit from its discontinued steel activities related to the proposed merger that was derailed by European antitrust regulators. The retroactive recognition of €113 million for the quarter and €228 million for the fiscal first half will be made in the company's next quarterly report, it said May 14.

The concerned steel operations include thyssenkrupp Steel Europe AG, thyssenkrupp MillServices & Systems GmbH and individual corporate companies in the prior year.

Adjusted EBIT fell 29% year on year to €353 million, while net sales increased 2% to €10.64 billion.

For its fiscal first half, the company's net income plunged 89% to €36 million on operating performance and an increased provision for risks from cartel proceedings. Adjusted EBIT dropped 27% to €685 million due to economic downturn, higher costs and declining prices.

Low water levels on the Rhine river, lower demand from the automotive industry and a new collective agreement impacted the company's steel segment for the period. Net sales increased 2% to €20.37 billion on the performance of the elevator business in the U.S. and Europe.

For the full year, thyssenkrupp expects its net income to be negative due to restructuring costs, provision for the result of a heavy plate cartel case and preparation for its planned initial public offering of its elevator business.