The recently initiated restructuring of the ailing steel division will cause the industrial group thyssenkrupp millions in losses in the new financial year.
Because the company has to make high provisions for this, the bottom line is likely to be a deficit of 400 to 800 million euros in 2025/26 (at the end of September), thyssenkrupp announced on Tuesday in Essen.
thyssenkrupp Steel Europe is suffering from overcapacity and low prices on the world market, and low-cost Asian competition is putting the traditional German company under pressure. Production capacities are to be reduced and thousands of jobs are to be cut. At the beginning of December, the group agreed on the final details with IG Metall. However, there are no new details about a possible takeover of the steel business by the Indian company Jindal Steel. The indicative offer received in mid-September will be further examined, it said.
thyssenkrupp does not expect any tailwind from the economy; the difficult market environment is likely to continue. The company expects sales to range from minus two to plus one percent. Thyssenkrupp sees adjusted earnings before interest and taxes (EBIT) at between 500 and 900 million euros – analysts had hoped for more in a consensus provided by the group.
thyssenkrupp had lowered its forecast for the past financial year due to weak demand and lower prices. Sales fell by a good six percent to 32.8 billion euros in 2024/25, and adjusted EBIT improved by 13 percent to 640 million euros, also thanks to cost savings. The bottom line is that the group earned money again with 532 million euros after a loss of billions in the previous year. However, thyssenkrupp benefited from a significant appreciation of its remaining share in the elevator business and the sale of thyssenkrupp Electrical Steel India. On the other hand, there were millions in depreciation and restructuring costs.
Shareholders should again receive a dividend of 15 cents per share.
Jefferies leaves thyssenkrupp on hold – target of 11 euros
The analysis house Jefferies has left the rating for thyssenkrupp at “Hold” based on figures and outlook with a price target of 11 euros. Thanks to cost savings, the industrial and steel group slightly exceeded market expectations with its adjusted operating result (EBIT), wrote Tommaso Castello in his first reaction on Tuesday. However, the target for this key figure for the 2025/26 financial year is below the consensus estimate.
thyssenkrupp shares under pressure
The shares of thyssenkrupp, which have recently recovered, temporarily fell by 9.10 percent to 8.69 euros in XETRA trading on Tuesday.
The recently initiated restructuring of the ailing steel division will cause the Essen-based company millions in losses in the new financial year. Because the company has to make high provisions for this, the bottom line is likely to be a deficit of 400 to 800 million euros in 2025/26 (at the end of September), thyssenkrupp announced this morning.
Since November 25th, thyssenkrupp shares have recovered by up to 18 percent. Many analysts see better times for Europe’s steel industry thanks to the new protectionism of the European Union with its shielding measures against steel imports.
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