ThyssenKrupp posts strong Q1 profit
The German steel group ThyssenKrupp posted on Friday a first quarter profit that was much better than expected, but warned a recovery remained fragile because sales would level off this year.
The group's pre-tax profit of €313 million ($428 million), its benchmark, was nearly three times bigger than an average analyst forecast of €110 million compiled by Dow Jones Newswires and a gain of €73 million from the same period a year earlier.
Earnings from the sale of an industrial services unit were the main reason for the pre-tax result, but a statement also pointed to "higher demand, better prices in some areas, higher productivity and continuing strict cost and capital spending controls."
The group's financial year runs from October 1 to September 30, and the statement quoted chairman Ekkehard Schulz as saying that looking ahead: "We regard the emerging economic recovery as still fragile."
ThyssenKrupp said it "anticipates that sales will stabilize" and maintained its full-year outlook unchanged, saying it still expected a pre-tax profit of less than €500 million.
On Wednesday, the world's biggest steel group, ArcelorMittal published its 2009 results and also gave a prudent outlook for this year.
Steelmakers have been slammed by the global economic slowdown and are now just beginning to fire up furnaces that were idled owing to a sharp fall in demand.