[Ferro-Alloys.com] Shares of German steel giant thyssenkrupp on Thursday plummeted by more than 14 percent after the company announced a net loss of 260 million euros (288.17 U.S. dollars) for the last fiscal year caused by "not satisfying" business performances.
Following the announcement, shares of thyssenkrupp were trading at under 12 euros last Thursday. At the beginning of 2018 when thyssenkrupp was still listed in the DAX index, the company was valuated more than twice as high.
The company said in a press release that the forecast net loss was expected to be even "significantly higher" because of higher payments for restructuring and an expected antitrust fine for which thyssenkrupp has allocated 370 million euros.
As part of the restructuring process, thyssenkrupp may cut more than the 6,000 jobs already announced. On Thursday, the company announced that the number of employees working at thyssenkrupp's headquarters would be reduced from 800 to around 430 within the next 12 months.
Thyssenkupp's steel business in Europe saw the biggest slump. The adjusted operating result (adjusted EBIT) of the company's European steel sector decreased to just 31 million euros compared to 687 million euros in the previous year.
"We currently leave no stone unturned in the company," said Martina Merz, chief executive officer (CEO) of thyssenkrupp. To fund further structural changes within the German steel giant, thyssenkrupp would be "pressing ahead" with the planned transaction of its prospering elevator business.
Elevator technology of thyssenkrupp recorded orders worth 8.2 billion euros in the fiscal year, resulting in a new record high thanks to "several major projects" in China and Australia. Compared to last year, sales for thyssenkrupp elevators grew by 5 percent.
According to thyssenkrupp, it had already received indicative offers from "strategic and financial investors" for its elevator business and would expect binding offers "as a basis for potential negotiations in the next year." At the same time, thyssenkrupp was seeking to complete internal preparations for an initial public offering (IPO) by the end of 2019.
Although some parts of thyssenkrupp like its highly profitable elevator business were among the best in their respective industries, "that should not cover up the urgent need for action that we see in other businesses," said Merz. (Xinhua)