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Company News, Capital market-relevant press releases, 2011-02-11, 07:30 AM

ThyssenKrupp makes good start in first quarter 2010/2011

ThyssenKrupp continued its positive performance in the first quarter of fiscal 2010/2011: Order intake showed a significant 21% year-on-year increase from €9,328 million to €11,260 million. Sales also rose distinctly by 22% from €9,351 million to €11,370 million. Thanks to sustainable cost savings the structural earning power of the Group improved considerably: Earnings before interest and taxes (EBIT) reached €273 million in the first three months of the new fiscal year, compared with €353 million in the prior year. However it should be borne in mind that earnings in the 1st quarter of the current year were impacted much more strongly by the negative contribution of the Steel Americas business area of €(378) million (prior year: €(71) million) caused by the startup losses of the new steel plants. In addition, the prior-year figure was favorably impacted by special items of €76 million. Adjusted EBIT was unchanged from the prior year (€277 million) at €273 million, despite the significantly higher negative impact from the Steel Americas business area. All business areas apart from Steel Americas made a positive earnings contribution.

Dr. Heinrich Hiesinger, the new Chairman of the Executive Board of ThyssenKrupp AG since January 21, 2011, believes the Group is well on the way to achieving its ambitious targets for the 2010/2011 fiscal year: “We are registering an encouraging economic upturn with very dynamic price and volume growth in materials and components. In the elevator business and plant construction we are profiting from full order books and keen demand particularly from the new growth markets.”

In fiscal 2010/2011 ThyssenKrupp expects an increase in sales by 10% to 15% (2009/2010: €42.6 billion). The Group’s earnings are expected to grow faster than sales. This will follow from further operating improvements and the recovery of the sales markets, which will more than offset the considerable negative contribution from the Steel Americas business area in the higher three-digit million euro range. The upward trend in all the other business areas confirms expectations that adjusted earnings before interest and taxes will be around €2 billion (2009/2010: €1.2 billion).

The highlights for the first quarter 2010/2011:
・ Order intake increased year-on-year by 21% to €11.3 billion.

・ Sales rose by 22% to €11.4 billion.

・ EBITDA came to €645 million, compared with €683 million in the prior year.

・ EBIT at €273 million was down from the prior-year figure of €353 million, which was favorably impacted by special items of €76 million.

・ Adjusted EBIT also came to €273 million (prior year €277 million).

・ Earnings per share amounted to €0.31, compared with €0.35 in the prior year.

・ Net financial debt at December 31, 2010 was €5,814 million, an increase of €2,034 million from September 30, 2010, when net financial debt of €3,780 million was reported. The increase in net financial debt is primarily due to the high borrowing requirements in connection with the investments for the new carbon and stainless steel plants in Brazil and the USA, and to the increase in net working capital (NWC) for the ramp-up of these plants. In addition, the significant rise in demand from customers required a corresponding increase in inventories. Not least, the substantial rises in raw material prices had the effect of increasing NWC. On December 31, 2009 net financial debt stood at €2,130 million.
Executive Board Chairman Dr. Heinrich Hiesinger: “Our ambitious cash and earnings targets require that we systematically continue and further develop our structural improvement programs while maintaining very strict spending discipline this fiscal year and beyond. This will include further programs to achieve sustainable cost reductions, targeted portfolio adjustments and also improvements to inventory management. Reducing our net financial debt is our number-one priority.”

The full interim report is available in German and English for viewing online and downloading at http://www.thyssenkrupp.com.

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