ThyssenKrupp is raising its forecast for the full year following a successful 1H14. The Group now expects to achieve sales growth in the mid to higher single-digit percent region on a comparable basis.
Adjusted EBIT is forecast to almost double y/y (prior year €586 million, previous guidance around €1 billion). The company continues to expect a significant improvement towards break-even earnings. The company met all its operating and strategic targets in the first half.
First half financial highlights
- Order intake, sales and adjusted EBIT increased y/y both on a cumulative basis in the first half and in the second quarter. The Group recorded a net profit after minority interest of approximately €269 million. Earnings per share came to €0.37 in the first half and €0.48 in the second quarter (prior year €(0.26) and €(0.25) per share, respectively).
- Order intake from continuing operations came to €20.9 billion in the first half, a 4% y/y increase from the prior year, despite negative exchange rate effects. On a comparable basis (excluding currency and portfolio effects) order intake increased by 6%. Second quarter order intake was €10.2 billion, slightly higher y/y (up 2% on a comparable basis).
- Sales from continuing operations came to €19.4 billion in the first half and €10.3 billion in the second quarter, and were higher y/y in all business areas except Steel Europe, where sales decreased due to disposals. On a comparable basis sales climbed by 7% y/y in the first half and 9% y/y in the second quarter.
- Adjusted EBIT from continuing operations increased significantly y/y to €555 million in the first half and €309 million in the second quarter. At €848 million (prior year €738 million) the capital goods operations achieved much higher operating earnings in the first half than the materials operations, which however even including Steel Americas generated a clear positive contribution of €128 million (prior year €(29) million).
- The Group's net financial debt at 31 March 2014 was reduced further to €4 billion, down significantly from both a year earlier (€5.3 billion) and the balance sheet date 30 September 2013 (€5 billion).
"We have achieved positive net income for the first time in seven quarters. This shows that our efficiency programme impact is working and our culture change is really bringing about a stronger performance ambition," sais Chief Executive Officer Dr. Heinrich Hiesinger.
There were three main drivers behind the improvement: firstly the efficiency gains, secondly strong growth in the capital goods businesses and thirdly the elimination of losses as well as disposal gains from divestments and restructurings.
ThyssenKrupp Industrial Solutions
At Industrial Solutions, order intake in 1H14 at €3.5 billion was largely stable versus the prior year (down 3%) and virtually unchanged on a comparable basis (prior year €3.6 billion). The high order backlog of €15.1 billion at 31 March 2014 secures continuing good workloads, offers planning certainty and contributes to growth prospects. Sales at Industrial Solutions came to €2.9 billion, up 5% y/y (prior year €2.7 billion). On a comparable basis the increase was 9%.
Sales benefited from the initial recognition of revenues from a number of major contracts, especially at Process Technologies. Second quarter adjusted EBIT improved significantly q/q. Total first half adjusted EBIT came to €372 million, up 16% y/y (prior year €320 million). This was due to order billings at Process Technologies and efficiency gains in all business units.
Adapted from press release by Rosalie Starling
Read the article online at: https://www.worldcement.com/europe-cis/13052014/thyssenkrupp_reports_on_a_successful_1h14_179/