Industrial group ThyssenKrupp has made a good operating start to the current fiscal year, meeting or exceeding all operating targets for the first quarter.
"We started the new fiscal year with a good first quarter without help from the economy. As expected, the main drivers of our growth were the capital goods businesses," said Dr. Heinrich Hiesinger, ThyssenKrupp’s Chief Executive Officer. "We have further improved our operating performance and efficiency and are on track to achieve our savings target of €850 million this fiscal year."
1Q results
- Order intake reached €10.7 billion, a 6% y/y increase from €10.1 billion in the same period a year earlier. On a comparable basis (excluding currency and portfolio effects), order intake rose by 10% y/y.
- Adjusted EBIT from continuing operations increased by 131% y/y to €247 million.
- Free cash flow from continuing operations before divestments saw an improvement y/y by €195 million to €85 million, significantly exceeding the target for the first quarter. This growth was due to customer advances, predominantly at ThyssenKrupp Industrial Solutions.
- The net financial debt of the Group was reduced from €5 billion at the end of the last fiscal year to €4.5 billion as a result of the capital increase at the beginning of December 2013.
- Equity improved from €2.5 billion to €3.3 billion and gearing rose significantly by around 64 percentage points to 136.2%.
- The Group's first quarter net income was impacted by special items. The main reasons were charges to financial income (€276 million) and further special items totalling €36 million. The charges were mainly in connection with the sale of the Outokumpu shares agreed as part of the transaction to end the links between ThyssenKrupp and Outokumpu. This was partly offset by income of €187 million due to the absence of previously recognised risks. As a result, a net loss of €69 million is reported for the full Group (against a net loss of €16 million in the same period a year earlier).
Outlook
Following a good operating start to the fiscal year, ThyssenKrupp has reaffirmed its outlook for the full year. The Executive Board expects sales before portfolio adjustments to grow y/y by a mid single-digit percentage rate. Adjusted EBIT for the Group, before portfolio adjustments, is expected to improve significantly y/y from €599 million to around €1 billion.
Adapted from press release by Rosalie Starling