Kloeckner Results Disappoint

The company’s restructuring effort has resulted in the sale of 60 locations in Eastern Europe and a reduction of 1800 workers.  Further reductions in France and the USA will bring the total sale or closure of facilities to 70 and a loss of 2000 employees.

Total turnover in the first half of 2013 was down by 10.3 percent y/y to 3.3 million tonnes due to weaker markets in the U.S. and Europe, restructuring costs and lower sales. Sales dropped 15 percent to €3.3 billion ($4.4 billion).

Turnover in the Americas segment in Q2 declined by 2.1 percent y/y to 749,000 tonnes but was up from 716,000 tonnes in Q1.  U.S sales were €637 million ($852 million), up from €608 million ($813 million) in Q1 but down 12.3 percent y/y.

The second half of 2013 is expected to be stronger primarily due to recovery in the U.S. and the restructuring efforts of the company.

“Even if we cannot expect any tailwind from the European steel market, we anticipate that, given the timely, radical restructuring measures, we will regain profitability under our own power next year. Additional impetus can come from the generally expected recovery in the USA, our growth market, and from the currently improving price environment,” said CEO Gisbert Rühl.