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Floundering Thyssenkrupp plunges into red in Q2

AFP  |  Berlin 

Struggling German conglomerate plunged into the red in its second quarter, posting a net loss of 86 million euros (USD 96 million) on Tuesday following that it will 6,000 jobs.

The plunge into loss-making at the start of the year contrasted with a 250-million-euro profit in early 2018, reflecting the troubled waters the Essen-based group has found itself in since last summer.

On Friday, announced 6,000 job cuts worldwide - including 4,000 in - as part of a structural shakeup following the collapse of a proposed merger with Indian

The German group's operating, or underlying profit (EBIT) fell 66 percent -- or 283 million euros - year-on-year down to 145 million euros.

"In the steel sector, the historic low ebb of the river Rhine, lower demand from the automotive industry and the new collective agreement (with worker representatives) had a negative impact on earnings," said in a statement.

However, there was some good as group-wide sales rose slightly, adding two per cent to reach 10.6 billion euros.

Performance was lifted especially by the elevators division in the and as order intake rose one percent, to 10.3 billion.

However, increased risk provisions related to a German anti-cartel investigation into burdened Thyssenkrupp's accounts.

On Friday, warned "we are building a new Thyssenkrupp... we are going to change a lot of things and it will not be an easy road".

This was reflected by the group's forecast net loss of between 1.1 and 1.2 billion euros for 2019.

Thyssenkrupp has abandoned a plan to split into two groups - "Industry" and "Materials" - but intends to list its highly profitable elevators business, valued at around 14 billion euros by analysts, on the stock market and adopt a holding structure.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, May 14 2019. 16:26 IST
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