ThyssenKrupp profit falls

May 30, 2001
Web posted at: 0729 GMT

LONDON (CNN) -- ThyssenKrupp, the biggest maker of stainless steel, said on Wednesday second-quarter profit plunged 61 percent as U.S. demand declined.

Germany's largest steelmaker said net income fell to 50 million ($48 million), or 0.10 a share, in the three months to March 31. That compares with 127 million, or 0.25 a share, in the year earlier period.

The Duesseldorf-based company, formed by the 1999 merger between Thyssen and Fried. Krupp AG Hoesch-Krupp, has been under pressure from falling steel prices that have hit 20-year lows due to overcapacity.

An economic slowdown in the U.S. has also had an impact on earnings, especially in the auto sector. The company warned Europe has succumbed to the U.S.-led decline in growth.

"The economic outlook for the second-half of the current financial year remains subdued initially," the company said. "However... we aim to match the previous year's pretax earnings."

"The U.S. economy in particular has cooled significantly... in the euro zone economic growth has also slackened," ThyssenKrupp said.

The company said second-quarter pretax profit at its automotive unit fell 77 percent to 21 million from 92 million in the year earlier period.

"The automotive segment generated sales of 3 billion, a slightly higher figure than a year earlier despite the massive slowdown of the auto industry" in North America, the company said.

ThyssenKrupp's stock fell 4.1 percent to 16.60 in early Frankfurt trade.

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