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ThyssenKrupp swings to fiscal Q3 loss on industrial-solutions unit woes

thyssenKrupp AG on Aug. 9 posted a group attributable net loss of €131 million, or 21 euro cents per share, for its fiscal third quarter, compared to a year-ago profit of €120 million, or 21 cents per share.

Net sales inched up 2% to €11.12 million, with its European steel segment's net sales totaling €2.50 billion, up from €2.34 billion a year ago. Adjusted EBIT fell 46% to €332 million due to additional project expenses of about €200 million in the industrial-solutions business, which reported adjusted EBIT of negative €216 million.

Commenting on the results, Executive Chairman Guido Kerkhoff said, "The bottom line is that we are not satisfied with the current results ... There's no point in sugar-coating it. Notably, the cash flow is unsatisfactory, and that is not a situation which can be sustained long term. We have to improve significantly across all our businesses."

In July, Chairman Ulrich Lehner stepped down on the heels of CEO Heinrich Hiesinger's departure as the group has been contending with growing pressure from activist shareholders

For the full year, the company expects consolidated EBIT of about €1.8 billion, at the lower end of its guided range of €1.8 billion to €2.0 billion. The group is targeting free cash flow before M&A of at least €1 billion, having reported negative free cash flow before M&A of €211 million for the quarter, although this was improved from negative €377 million a year ago.

Net financial debt as of June 30 was down to €3.81 billion from €6.31 billion year on year.

For the nine months ended June 30, the company swung to a profit of €190 million from a year-ago loss of €751 million.