Thyssenkrupp recorded net losses of 372 million euros (403.3 million U.S. dollars) in the first quarter (Q1) of the 2019-2020 fiscal year due to restructuring expenses, the German steel giant announced on Thursday.
Total net debt of Thyssenkrupp, which was recently pushed out of Germany’s prime stock index DAX after more than 30 years, increased from 3.7 billion euros to 7.1 billion euros, according to Q1 figures.
Adjusted earnings before interest and taxes (EBIT) declined to 50 million euros, significantly below last year’s 217 million euros. According to Thyssenkrupp, the development was “particularly due to the situation at Steel Europe and a general weakening of the automotive market.” At the same time, order intake was down 4 percent.
“The latest figures are not great. But we are convinced that we are on the right track,” stated Martina Merz, chief executive officer of Thyssenkrupp AG, adding that the company would make progress and had improved its performance.
The performance of Thyssenkrupp’s steel business in Europe (Steel Europe) has been characterized by a “structurally extremely challenging situation.” While order intake and sales were down 10 percent and 13 percent year-on-year, respectively, adjusted EBIT collapsed to minus 164 million euros from 38 million euros last year.
Thyssenkrupp’s important elevator business registered orders worth 2.2 billion euros in Q1, which was a new record high “mainly resulting from new installations and modernization business in the United States.”
Thyssenkrupp is seeking to sell its profitable elevator business as part of its restructuring measures in the near future.