ThyssenKrupp posts better-than-expected profit in Q1

ThyssenKrupp posted a better-than-expected quarterly operating profit yesterday, as it reined in losses at its steel mill in Brazil and also benefited from robust demand for cement and petrochemical plants. Its net loss for the fiscal first quarter through December widened on one-off charges related to the sale of a stake in Finnish steelmaker Outokumpu, but ThyssenKrupp said it still aimed to approach break-even this year.

ThyssenKrupp has been trying to return to long-term profitability by investing in services and engineering businesses and reducing its dependence on the volatile steel sector.

First-quarter adjusted earnings before interest and tax (EBIT) more than doubled to 247mn euros ($337.6mn), beating even the most optimistic estimate in a Reuters poll of analysts.

The adjusted EBIT margin widened to 2.7% from 1.2% as ThyssenKrupp made more money from powertrain and chassis sales to carmakers and saw continued demand for cement and petrochemical plants.

Earnings at its steel businesses meanwhile remained depressed, with losses in Brazil shrinking but not turning to profits yet and low steel prices weighing on earnings in Europe.