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ThyssenKrupp H1 income plunges on weak prices

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ThyssenKrupp H1 income plunges on weak prices

German steelmaker ThyssenKruppAG said May 10 that its net income attributable to shareholders plunged62% year over year to €37 million, or 7 cents per share, for the company's fiscalfirst half ended March 31.

"Our half-year results still reflect the very weak situationon the materials markets. While we are now seeing a recovery in material prices,it is coming later than we originally expected and from a lower level and will alsobe reflected in our figures with a time lag," CEO Heinrich Hiesinger said.

EBITDA decreased by 15% to €1.07 billion, with net sales falling8% on a yearly basis to €19.40 billion while the group's order intake decreasedin the six-month period by 8% to €18.84 billion. Cost of sales receivedwas €16.26 billion in the period under review, compared to €17.78 billion bookeda year earlier.

The company attributed the decline in orders and sales partlyto lower volumes but mainly to the sharp fall in prices at the materials businesses.

Net sales included €675 million from the group's Steel Americasdivision, down 34% year on year on a comparable basis due to increased price pressuresin the U.S. and South America. Shipments were up 18% to 2.2 million tonnes.

At Steel Europe, sales fell by 14% on a comparable basis to €3.65billion as shipments declined by 9% to 5.2 million tonnes.

The group's operating cash flow was negative at €703 million,compared to negative €174 million in the same period a year earlier.

For the second quarter of its fiscal year, the group's net incomeattributable to shareholders jumped 26% on a yearly basis to €61 million as netsales dropped 10% to €9.85 billion. EBITDA also fell by 13% to €585 million.

For the ongoing full year, the group expects adjusted EBIT ofup to €1.4 billion supported by €850 million from the company's efficiency programs.The expectation compares to prior adjusted EBIT forecast of between €1.6 billion and €1.9 billion.

However, Sven Diermeier, an analyst at Independent Research GmbH,told Bloomberg News: "I was a bit surprised by the profit warning because steelprices have recovered significantly since mid-February."