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SUBSEQUENT EVENTS

There were no significant events requiring disclosure after the balance sheet date.

FOCUS OF THE GROUP IN THE NEXT TWO FISCAL YEARS

ThyssenKrupp will maintain its general focus as a worldwide supplier of steel, capital goods and services. We have outstanding expertise and profound market knowledge in these areas. Our highly qualified employees and international network of production operations and sales establishments justify our focus on these established business activities. The upward trend of the world economy is expected to promote further growth in our business.

Global growth slightly weaker

The global economic upswing will continue in 2007, albeit at a slightly slower rate. With a 4.5% increase in world GDP, growth will be only slightly lower than in 2006 at 5.2%. Beyond this forecast horizon we expect slightly slower growth of the world economy. In view of the high raw material and oil prices worldwide, the risks to economic growth remain undiminished.

Gross domestic product* change compared to previous year in %

* Forecast

Continuing high growth momentum is expected in the countries of Asia. In China in particular, the economic upswing will continue thanks to strong investment. In India, too, the pace of growth is not expected to slacken in 2007. Above-average growth rates are also forecast for most countries of Latin America and Central and Eastern Europe.

In the industrialized countries, economic growth is expected to cool. Higher interest rates and the weakness of the property market are dampening growth prospects in the USA. Weaker growth is forecast for Japan, too, due to slowing investment and exports. A similar pattern is expected in the euro zone. In Germany in particular, economic growth is likely to weaken at least temporarily, slowed above all by a tight fiscal policy and stagnating private consumption.

Predominantly positive trend on key customer markets

We expect a predominantly favorable trend on the customer markets of importance to ThyssenKrupp. The prospects for the world steel market in particular remain generally positive. World demand for rolled steel will grow by around 5% in 2007, driven mainly by the emerging countries of Asia and Latin America and the CIS states. In Europe and the NAFTA region demand is expected to remain steady or fall slightly due to the somewhat subdued economic outlook and the expected reduction of stocks. However, steel consumption is expected to increase further. Output will rise primarily in the emerging countries – especially China, India and Brazil – as major new capacities go into operation. The situation on the raw material and energy markets will remain tight on the whole, keeping steel production costs at a high level or pushing them even higher.

We expect demand for stainless steel and the high-performance materials nickel alloys and titanium to continue to rise in 2007, both in Europe and North America and also in Asia, in particular China. While in China most producers have been operating below capacity due to strong capacity growth in recent years, producers in Europe and the USA are barely able to keep up with demand.

We expect the automotive market to remain a growth market overall. For 2007 we expect worldwide production to grow by 2% to 70.5 million vehicles. However, the new production capacities are increasingly being installed in the emerging Asian countries and in Central and Eastern Europe. These countries could once again significantly expand their vehicle production in 2007. In the NAFTA region, Western Europe and Japan, volumes will decrease slightly. As a result of weaker domestic demand, German auto production is expected to fall to 5.7 million cars and trucks.

Due to the slightly reduced pace of global expansion, growth in the mechanical engineering sector in 2007 is not expected to be as strong as the year before. There are signs of cooling in the USA and Western Europe in particular. In China, continuing high investment will continue to ensure strong growth.

The international construction market will remain characterized by large regional differences in 2007. In the euro zone growth will be weaker, and in Germany a slight rise in construction output is expected. However, a significant downturn in construction activity is likely in the USA. Growth will remain focused on the countries of Eastern Europe as well as India and China.

OPPORTUNITIES THROUGH INNOVATION AND INTERNATIONALIZATION

Under a systematic forward strategy, ThyssenKrupp sees significant growth opportunities for the coming years. We aim to further increase the innovativeness and competitiveness of our products and services. Innovative processes and products open up opportunities to secure and build on our top positions on numerous markets. This applies not only to our range of materials but also to our complete system solutions, for example in plant technology and marine systems. We also see good prospects in the industrial services business. Its unique profile with innovative service offerings can make an even greater contribution to the Company's success in the future.

In the area of opportunity management, further internationalizing the activities of all segments is a key priority. Above all, we intend to step up our involvement in the up-and-coming countries of Asia, Latin America and Eastern Europe and participate in their growth. To this end we are building our own local production plants. However, we also see diverse opportunities for strategic acquisitions.

In the Steel segment, the new steel mill in the Brazilian state of Rio de Janeiro will open up new opportunities. The low-cost, high-quality slabs supplied from Brazil will allow us to exploit growth opportunities in our core market of Europe and in the NAFTA region. The planned strengthening of our presence in North America with the establishment of our own rolling capacities for both carbon and stainless steel flat products will enhance our credentials on this key market as a flexible materials manufacturer with a local presence capable of responding quickly to the requirements of customers.

Details of our corporate strategy aimed at exploiting our future opportunities are provided here.

EARNINGS SITUATION EXPECTED TO REMAIN POSITIVE

If the economic forecasts prove accurate, we anticipate a continued positive performance in 2006/2007 and 2007/2008.

Sales: We currently expect sales in 2006/2007 to be in the region of €47 billion.

• Steel is aiming for an increase in sales of flat-rolled carbon steel, with prices rising slightly for structural reasons.
• Stainless forecasts moderate sales growth mainly as a result of volume and structural improvements in stainless steel flat products and higher base prices.
• Technologies anticipates an increase in sales for the segment's previous activities, with a strong order backlog in the project business and order intake expected to be high. Excluding the disposals (mainly the North American body and chassis business, ThyssenKrupp Plastics, ThyssenKrupp Stahl Company), sales at the Automotive activities are expected to be unchanged from the prior year.
• Elevator once again expects a significant increase in sales in the coming fiscal year, secured by a high level of orders in hand. All regions are expected to contribute to this improvement.
• Services anticipates slightly lower sales due to the expected decline in prices. Improvements are forecast in the service activities and in the Eastern European market.

Based on a continued positive performance, we expect the Group's sales to remain strong in 2007/2008. We continue to intensively pursue our sales target of €50 billion.

Earnings and dividend: Our sustainable target for pre-tax earnings over the economic cycles is €2.5 billion. Having achieved this target in 2005/2006, we are confident we can repeat our performance in 2006/2007. We aim to achieve earnings of a similar magnitude in 2007/2008.

We will continue to pay a dividend based on our earnings performance.

Employees: We plan to have around 191,000 employees at September 30, 2007, an increase of 2%. In 2007/2008 the headcount is expected to increase by a further 2%. Despite the anticipated increases, the workforce in Germany is likely to decrease because for market- and cost-related reasons the growth in employment will take place almost exclusively outside Germany. Training young people will remain a high priority in the future and for this reason we will continue to provide apprentice training beyond our own requirements. In view of the shortage of apprenticeship places on the market, we aim to give as many young people as possible a sound start to their working lives. The Group's total personnel expense in 2006/2007 is expected to be around €9.5 billion; in the subsequent year it could increase further.

Procurement: In the next two fiscal years, materials expense is again expected to amount to significantly more than 50% of sales due to persistently high raw material prices and the increasing proportion of purchased products and services. In view of our long-term, international supplier relationships, we do not anticipate any bottlenecks in the procurement of raw materials, components, operating materials or services in 2006/2007 or 2007/2008.

In fiscal year 2006/2007 we will continue our successful purchasing initiative, which will not only further reduce overall costs but in the medium term also strengthen the quality of purchasing. One aspect of this will be the expansion of our strategic supplier management system, under which we identify the best suppliers worldwide so that we can focus on them more strongly and build long-term partnerships with them. In this way we can limit or in some cases even reduce purchasing prices.

Research and development: In the current fiscal year we plan to spend over €800 million on the development of new products and processes including quality assurance. This represents an increase of over €50 million. A further increase is planned in the following fiscal year. One key area is the development of new carbon and stainless steel materials which can be easily processed by our customers, e.g. in the auto industry, while at the same time displaying high strength. In the marine systems business we aim to optimize the building of naval ships and the integration of the various electronic control systems. Our plant technology business will further develop several of its production processes with the aim of reducing energy consumption. For the planned increase in development activities, our research centers will recruit more employees; in addition, cooperation with external universities will be intensified. Individual projects may be carried out under international research contracts to shorten development times. The Group's development centers will work on a cross-segment basis as far as possible in order to pool resources and enhance efficiency.

Environmental protection: Spending on ongoing environmental protection programs is expected to total over €400 million in both fiscal 2006/2007 and fiscal 2007/2008. Most of this will go towards reducing air and water pollution. In the Steel and Stainless segments, significant investments in pollution control equipment may be incurred for the construction projects in Brazil and the USA. We will expand our recycling activities in all segments to make better use of materials and conserve natural resources. Efforts aimed at saving energy in our operations will also be continued.

EXPECTED FINANCIAL SITUATION

At €7 billion, the volume of investment approved by the Supervisory Board is significantly higher than the previous year due to the investments in Brazil. In 2006/2007 – excluding any influences from the Dofasco project – we plan to invest €3.2 billion in tangible, intangible and financial assets, €1.7 billion above depreciation. The Group has adequate funds to finance the planned capital expenditures in 2006/2007, and our ambitious investment program for the following fiscal year is also on a solid financial basis.