First-quarter sales slide at Thyssenkrupp

(Sharecast News) - Thyssenkrupp posted a slide in first-quarter sales and orders on Thursday, as restructuring charges pushed the German industrial conglomerate deeper into the red. Sales at the Essen-based firm declined 8% in the three months to December end to €7.2bn, which it attributed to "price and demand factors" in a challenging market.

The order intake was also lower. It came in at €7.7bn compared to €12.5bn a year previously, when the figure was boosted by a number of major orders at marine systems division TKMS.

Adjusted earnings before interest and tax rose 10% to €211m, on the back of a company-wide efficiency programme.

But net losses ballooned to €353m from €51m after Thyssenkrupp took a €401m charge to fund a major overhaul of its struggling steel division. Following protracted talks with unions, it is axing 11,000 jobs, cutting steel production by around 3m tonnes and investing in new low-carbon facilities.

Thyssenkrupp is also overhauling the wider business as it looks to become a holding company for its five main divisions. It spun out TKMS in October, retaining a 51% stake.

Miguel Lopez, chief executive, said: "Step-by-step we are strengthening our competitiveness while driving the group's transformation with determination.

"Despite market-related declines in sales, adjusted EBIT increased, a clear sign of progress in efficiency, costs and structure."

Looking to the full year, Thyssenkrupp confirmed guidance, "notwithstanding the persistently challenging market environment".

It expects adjusted EBIT to come in between €500m and €900m, while net losses are slated to range from €400m to €800m.

As at 1030 GMT, the Frankfurt-listed stock was down 2%.