Thyssenkrupp lowers full-year steel sales outlook on challenging market environment

German steelmaker Thyssenkrupp has lowered its sales outlook for the 2023-24 financial year ending Sept. 30 due to a continued challenging market environment, it said late July 25.

The conditions had resulted in a “significant decline in sales in the current financial year, among other things,” it said in a statement, with the company now expecting sales to fall 6%-8% year on year.

The lower expectations were informed by preliminary results for the third quarter of the October 2023-September 2024 financial year and its updated forecast for the full year, it said.

Preliminary, unaudited sales for Q3 were worth around Eur9 billion ($9.8 billion), although the company did not provide any sales volumes.

“The market is not expected to stabilize in the short term in the current fiscal year. The efficiency improvement measures introduced as part of the APEX performance program are successfully mitigating the negative developments of the market, but cannot fully compensate for these effects,” Thyssenkrupp said.

The company had previously said in its quarterly results statement released May that it expected sales to be below the previous financial year due to volume reductions and lower prices at its Steel Europe and Materials Services units, with the macroeconomic outlook for the rest of 2024 to remain “overall challenging.”

German steel product sales fell 2% year on year in the first half of 2024 to 4.9 million mt, according to German steel stockholders’ association BDS data released July 26.

Both real and apparent demand in H1 has been lower year on year, mainly due to slow growth in the construction and automotive sectors that has put a strain on the industry, forcing producers to sell at close to breakeven levels, market sources said.

There has also been uncertainty around EU safeguard duties and the feasibility of importing some steel products, such as hot-rolled coil, adding to concerns.

Platts, part of S&P Global Commodity Insights, assessed domestic HRC prices in Northern Europe at Eur630/mt ex-works Ruhr July 25, down 8.7% from the start of 2024.

Jacqueline Holman | Devbrat Saha | Geraint Moody