German steel giant Thyssenkrupp has revised its outlook for the fiscal year 2023/24, now anticipating a break-even result instead of the previously expected net profit in the low to mid three-digit million euro range.
In the first quarter, Thyssenkrupp reported a net loss of 314 million euros (336 million U.S. dollars), a stark contrast to the profit of 75 million euros recorded in the same period last year. The loss was primarily due to impairment losses attributed to higher capital costs, the company stated.
Sales during the quarter fell by nearly 9% to 8.2 billion euros. The decline was driven by lower price levels in the steel and materials businesses, as well as decreased sales of work and raw materials, which negatively impacted the company’s performance.
“The steel industry is facing a very challenging environment,” Thyssenkrupp noted in a statement. The company highlighted factors such as the weak global economy, renewed increases in raw material costs, high energy prices, and intense competition from non-European market participants as significant challenges affecting Europe’s steel producers.
Thyssenkrupp’s adjustment reflects broader concerns in the steel industry, which is grappling with fluctuating demand and pricing pressures. The company’s outlook revision signals caution amid economic uncertainties and competitive pressures in the global steel market.
Industry analysts suggest that the challenges faced by Thyssenkrupp may prompt a strategic reassessment to bolster competitiveness and adapt to the evolving market conditions.
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German steel giant Thyssenkrupp lowers outlook after Q1 loss
cgtn.com
