Thyssenkrupp profits squeezed as restructuring drags on

German industrial conglomerate Thyssenkrupp on Thursday reported slumping operating profits in October-December while locked in a struggle to free itself from years of crisis.

The floundering steel division plunged into the red in the first quarter of its 2019-20 financial year, helping drag Thyssenkrupp’s adjusted operating profit down 77 percent year-on-year to 50 million euros ($54 million).

“Continuing weak sales on the world’s biggest market China” also weighed on the group’s car components division.

And the group-wide bottom line showed yet another net loss, although Thyssenkrupp also reported stable revenues and order intake only slightly down on late 2018.

“The latest figures are not great. But we are convinced that we are on the right track,” chief executive Martina Merz said in a statement.

She reiterated that a decision is “imminent” on whether to sell off or float on the stock market the highly profitable elevators business, which bosses hope will provide a cash injection of up to 15 billion euros to pump into the weaker divisions.

Finnish competitor Kone is top of the list of potential buyers, and has said it bid 17 billion euros for the lifts unit.

Thyssenkrupp, whose products range from raw steel to submarines and construction materials, booked a net loss of 304 million euros in its 2018-19 full year.

Bosses said Thursday they hope to bring in operating profits around last year’s level of 802 million euros in 2019-20, but said the bottom line would show a “significantly higher net loss” as costs for restructuring measures pile up.

ylf/tgb/ach