German group ThyssenKrupp, which specializes in steel production, capital goods and services, has released its financial results for the first quarter of the financial year 2008-2009.
During the period in question, the company's net income decreased from €435 million to €163 million year on year, while the company's earnings before taxes slipped from €646 million to €240 million year on year. The producer's order intakes for the first quarter registered a drop of three percent from the corresponding quarter of the previous year to €12.9 billion, while its sales decreased by six percent year on year to €11.5 billion. The company's profit before interest, taxes, depreciation and amortization (EBITDA) saw a decrease to €764 million, compared to €1,083 million a year earlier.
The company's net financial debt on December 31, 2008 was €3,514 million, an increase of €1,930 million compared with September 30, 2008, when the company reported net financial debt of €1,584 million. ThyssenKrupp connects this rise to capital expenditure, in particular for its major investment projects, and also to the effects of the economic downturn and the associated impact on its operating business. At the end of the quarter, the group had cash funds and committed, undrawn credit facilities of a total amount of over €5 billion.
ThyssenKrupp also said that it would cut jobs in its steel division due to the decline in orders, but did not give exact figures.
Commenting on the results, ThysenKrupp CEO Ekkehard Schulz said, "The drastic, and in this measure unforeseeable, fall in demand in steel and stainless steel and in international building materials affected our business considerably. In the FY 2008-2009, we expect a significant decline in sales. This will affect profits correspondingly."