German concern Thyssenkrupp again posted a second-quarter net loss of 223 million euros ($245 million) after rising interest rates and the cost of capital led to impairment losses in its Steel Europe division, which it seeks to sell or to be jointly managed.
The group's adjusted operating profit (EBIT) fell by 74% to €205 million in the second quarter, mainly due to higher raw material costs and lower selling prices for steel. Impairment losses in the steel business amounted to EUR 350 million.
Thyssenkrupp Steel Europe posted an adjusted operating loss of EUR 14 million for the quarter, compared to a profit of EUR 479 million in the same period last year.
In a joint letter to shareholders, outgoing CEO Martina Merz and CFO Klaus Keisberg said solutions for the steel business include "possible cross-industry and cross-border partnerships."
"We have begun promising discussions with potential partners" , they wrote without elaborating.
Thyssenkrupp expects free cash flow to turn positive for the first time in seven years. The adjusted pre-M&A free cash flow forecast is driven by expected cash inflows to certain divisions of the submarine and auto parts group, including its defense business.