International Steel Mills

ThyssenKrupp Restructuring Stabilizing Company

May 12, 2014

ThyssenKrupp posted a positive net income for the first time in seven quarters. After aggressively shedding businesses and employees during the fiscal year, including the sale of the Alabama Calvert plant, ThyssenKrupp appears to have achieved a turnaround.

The company hopes to break even for the 2013/2014 fiscal year and expects sales for the year will increase a mid to higher single-digit percentage rate year-on-year (a more optimistic forecast than previously). Earnings before interest and tax (EBIT) are expected to “almost double” year-on-year. ThyssenKrupp says it is confident it will meet its savings goal of €850 million for the year. Net income for the second quarter totaled €271 million ($372 million).

ThyssenKrupp anticipates higher earnings in FY 2014/2015, providing the global economy continues to improve. The company will continue to focus on restructuring and implementing its integrated strategic development plan, including targeted growth opportunities.

Divestment in FY 2013/2014 included the sale of ThyssenKrupp USA to ArcelorMittal and NSSMC for $1.55 billion. In February 2014, ThyssenKrupp disposed of its 29.9 percent interest in Outokumpu and in return acquired VDM, AST and several European stainless steel service centers.

The Railway/Construction unit was to be sold but will now become a part of Materials Services. As a result of the rail cartel scandal and associated costs, the rail equipment business will be discontinued with sites either sold or closed.

A deal is in the works with the Saab to sell the Swedish shipyard ThyssenKrupp Marine Systems.

A consolidation of engineering companies resulted in ThyssenKrupp Industrial Solutions. Expansion is underway in Elevator Technology, Components Technology and Materials Services.

ThyssenKrupp also increased its capital through issuance of 51 million new shares of stock, a bond issue and a syndicated credit line.

Orders at Steel Americas, which included Calvert until the February sale) were up 11 percent year on year in the first half of 2013/2014. Order intake at ThyssenKrupp CSA in the first six months of FY 2013/2014, was 13 percent higher year-on-year due to higher volumes. Slab production at CSA was 998,000 tonnes in Q1 and 987,000 tonnes in Q2. Shipments rose to 1,034,000 tonnes in the Q2 from 923,000 tonnes in Q1.