Bulging order book keeps ThyssenKrupp on course for 2017

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German manufacturer and steelmaker ThyssenKrupp confirmed its objectives for its full financial year Thursday, saying it was confident after a solid third quarter with continued growth in orders.

Net profit at the group reached 120 million euros ($140.6 million) between April and June, some 8.0 percent lower than the same period in 2015-16.

But revenues grew 11 percent to reach 10.9 billion euros, while operating, or underlying, profit grew 41 percent to reach 620 million euros on an adjusted basis.

Meanwhile, "in the first nine months of the year we received more than 32 billion euros of new contracts... it's especially satisfying that all business areas contributed," chief executive Heinrich Hiesinger said in a statement.

In the third quarter of the firm's financial year, which ends September 30, new orders grew by 14 percent for the group's products, which range from steel to elevators, submarines, car parts, and ready-to-use industrial plants.

As well as increasing orders, increased prices in steel and raw materials units flowed into the firm's bottom line.

Nevertheless, "the big variations from quarter to quarter show that our strategic direction is the right one," Hiesinger said of the raw materials business.

ThyssenKrupp plans to focus more strongly on its industrial goods and services business areas to reduce its dependence on the steel market.

Looking ahead to the full financial year, ThyssenKrupp confirmed its objectives of "high single digit percentage growth" in revenue and adjusted operating profit of 1.8 billion euros.

As the group warned in May, net profits will suffer from the hefty writedown in value of a Brazilian steel plant that it sold to Argentina's Termium.

Over the first nine months alone, ThyssenKrupp reported a net loss of 751 million euros.

"Without taking this one-off effect into account, the annual net profit would be significantly higher than in the previous year," the group said.

Analysts welcomed ThyssenKrupp's results as better than expected, but stock market reaction was muted, with the stock adding 0.29 percent to trade at 25.64 euros ($30.04) around 0940 GMT, outperforming however a DAX index of blue-chip German shares down 0.7 percent.

Investors had looked in vain for news about a possible merger of the group's steel business with Indian steelmaker Tata's European arm.

"There is nothing new to announce" on the subject, ThyssenKrupp finance chief Guido Kerkhoff told journalists in a telephone conference.

© 2017 AFP

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