Skip to content
Search

Latest Stories

Thyssenkrupp Presses On With Split As Profits Rise

GERMAN multinational conglomerate Thyssenkrupp on Tuesday (12) confirmed its earnings forecasts for the full year after increasing profits in its first quarter, while announcing a January 2020 vote on its split into two separate firms.

Net profit at the group rose 69 per cent between October and December, to $153 million.


The latest 50-50 joint venture, ‘Thyssenkrupp Tata Steel’ and will be the second largest steel producer in Europe, after ArcelorMittal after Thyssenkrupp signed a final deal with India's Tata Steel to establish a long-expected steel venture.

The European Commission's green light is still needed for the merger.

A major contributor to the fatter bottom line should be "positive effects arising at the closing of the steel joint venture" with the European operations of Indian giant Tata.

Revenues at the steelmaker, whose product range stretches from submarines to elevators and car parts, edged two per cent higher to reach €9.7 billion.

Meanwhile adjusted operating profit fell 26 per cent.

"Thyssenkrupp is operating in attractive markets and our fundamental growth drivers are intact," chief executive Guido Kerkhoff said.

"But the figures also show that we have to keep pressing forward with our performance programmes in all business areas," he added.

The group said increased sales across all its business areas, notably the elevator business in Europe and North America, contributed to its higher revenues.

But even the standout division saw lower profits as higher raw material costs and tariffs on materials imports into the US made themselves felt.

Based in Rhineland industrial city Essen, low water levels on the vital river artery following a hot, dry summer "severely" impacted Thyssenkrupp's steel business by slowing shipping.

And the slowdown in production in the car industry following the introduction of new, tougher emissions tests also temporarily reduced demand for Thyssenkrupp's products.

Although Thyssenkrupp said "economic and political uncertainties are growing" and casting a shadow over business, the group maintained its forecast for 2018-19 of adjusted operating profit above one billion Euros around 30 per cent higher than the previous financial year.

Net profits should also "increase significantly" from the €60 m booked in 2017-18, the group also predicted.

In the group's broader restructuring, launched last year under pressure from activist shareholders, the group said investors would have a vote in January 2020 on its split into two listed companies.

Of the new twin Thyssenkrupps, one known as "Industrials" will combine the elevator, car components and factory-building businesses.

Its counterpart, ‘Materials’, will group together steel and the shipbuilding unit.

"Both companies are to commence operations at the start of the next fiscal year on October 1, 2019," Thyssenkrupp said.

(AFP)

More For You

Baiju Bhatt

At 40, Bhatt is the only person of Indian origin in this group, which includes figures such as Meta’s Mark Zuckerberg. (Photo: Getty Images)

Baiju Bhatt named among youngest billionaires in US by Forbes

INDIAN-AMERICAN entrepreneur Baiju Bhatt, co-founder of the commission-free trading platform Robinhood, has been named among the 10 youngest billionaires in the United States in the 2025 Forbes 400 list.

At 40, Bhatt is the only person of Indian origin in this group, which includes figures such as Meta’s Mark Zuckerberg. Forbes estimates his net worth at around USD 6–7 billion (£4.4–5.1 billion), primarily from his roughly 6 per cent ownership in Robinhood.

Keep ReadingShow less
UK business district
The Canary Wharf business district including global financial institutions in London. (Photo: Getty Images)
Getty Images

Economy shows no growth in July amid political turbulence

UK's ECONOMY showed no growth in July, according to official data released on Friday, adding to a difficult week for prime minister Keir Starmer’s government.

The Office for National Statistics (ONS) said gross domestic product was flat in July, following a 0.4 per cent rise in June.

Keep ReadingShow less
India’s IT sector

India’s $283 billion IT industry, which contributes more than 7 per cent to the country’s GDP, has for over three decades provided services to major clients including Apple, American Express, Cisco, Citigroup, FedEx and Home Depot.

iStock

India’s IT sector faces uncertainty as US proposes 25 per cent outsourcing tax

INDIA’s IT sector is facing uncertainty as US lawmakers consider a 25 per cent tax on companies using foreign outsourcing services.

Analysts and lawyers said the proposal has led to customers delaying or re-negotiating contracts, raising concerns in India, the world’s largest outsourcing hub.

Keep ReadingShow less
Rachel Reeves

'Our economy isn't broken, but it does feel stuck,' Reeves said, speaking alongside the release of a finance ministry report on business property taxation, known as rates.

Getty Images

Reeves signals possible changes to business property taxes ahead of budget

CHANCELLOR Rachel Reeves said on Thursday she is considering changes to business property taxes to support small firms looking to expand, as part of her plans to boost growth.

Reeves’ comments come ahead of her annual budget on November 26, at a time when concerns about possible tax rises and inflation are weighing on businesses and households.

Keep ReadingShow less
Rachel Reeves

Reeves pledged to keep a tight hold on spending to reduce inflation and borrowing costs amid concerns over Britain’s fiscal outlook.

Getty Images

Reeves urges ministers to back Bank of England on inflation

CHANCELLOR Rachel Reeves has said the government must support the Bank of England in bringing down inflation while also focusing on growth, ahead of a budget later this year that is expected to include tax rises.

Last week, Reeves said the economy was not “broken” as she announced November 26 as the date for her annual budget.

Keep ReadingShow less