As a result of low steel prices and weak demand, distribution group Klöckner & Co recorded a significant year-on-year decrease in operating income in the second quarter.
The firm suffered a net loss of €111 million ($131m), compared with a net profit of €28m in the prior-year period. Revenue dropped by -30.4% to €1.171 billion on shipments that fell -27.6% to 1.07 million tonnes, Kallanish notes.
Klöckner & Co has continued to drive its digital transformation, and raised the share of sales generated via digital channels to 38%, compared with 29% in Q2 2019.
By way of project Surtsey, which was initiated at the start of the pandemic, Klöckner & Co has increased the automation of core processes. This has accelerated its transformation into a platform company and implementation of restructuring measures. The goal of the implemented measures is to achieve an overall improvement in earnings of more than €100m by end-2021 and simultaneously increase the share of sales generated via digital channels to over 50%.
“Our transformation strategy is taking effect,” Klöckner chief executive Gisbert Rühl told journalists during a conference call. “Thanks in particular to our Klöckner Assistant, we have succeeded in further accelerating the growth of our sales via digital channels.”
In Europe, the construction, mechanical engineering and, especially, automotive industries are ailing. In the US, construction, mechanical engineering, energy and automotive are also under pressure, the enterprise concludes.
In light of the global pandemic, Klöckner & Co is anticipating a substantial decline in steel demand in the relevant key European and US markets for 2020.
