Thyssenkrupp shares slide on disappointing Q3 results

Invessting.com -- Shares of Thyssenkrupp AG (ETR:TKAG) fell on Wednesday after the steelmaker reported disappointing third-quarter results. 

At 3:24 am (0724 GMT), Thyssenkrupp was trading 2.4% lower at €3.215.

The company, which has already cut forecasts three times in recent months, reported a drop in new orders and sales. 

Thyssenkrupp's order intake fell nearly 11% to €8.4 billion for the three months ending June 30. The slowdown in key sectors such as automotive technology, machinery, and construction has impacted the company's performance. 

The quarterly net loss amounted to €33 million, reflecting ongoing challenges in the market.The company has revised its predictions, now expecting a net loss and negative free cash flow for the fiscal year 2024. 

Weak demand and high energy costs are expected to persist, with no immediate stabilization in sight. Investor confidence in Germany, Thyssenkrupp’s primary market, has plummeted, mirroring the broader pessimistic outlook for the global economy.

“We update our estimates for 3Q 2023/24 results published earlier today. This set of results showed commercial and operations strength in both divisions, which helps differentiate nucera vs most peers in a challenging environment for electrolyser manufacturers,” said analysts from RBC Capital Markets in a note.  

The company has also paused its efforts to sell the Automation Engineering unit, focusing instead on potential structural changes to its powertrain business. A decision on this matter is expected by the end of the current fiscal year. 

Additionally, Thyssenkrupp plans to cut 400 positions in Germany, particularly in its automotive chassis unit, while increasing capacity outside Germany.

Thyssenkrupp's ongoing efforts to restructure its loss-making steel division are facing delays. Despite agreeing in May to sell a 20% stake in Thyssenkrupp Steel Europe AG to Czech billionaire Daniel Kretinsky’s EP Corporate Group, progress on job cuts and capacity reductions has stalled. 

Disagreements over financing needs and an unresolved supervisory board meeting last week, marked by worker protests, have further complicated the situation.