无锡不锈钢市场 510bxg.com ThyssenKrupp 2007-12-6 21:16:32

LONDON - A gloomy outlook for 2008 prevented Germany's ThyssenKrupp from capitalizing on a bumper year for its stainless steel business.

Shares in the steel and engineering giant fell by over 5%, as headline results fell short of expectations, while the company predicted demand for steel to "normalize" in 2008, following a huge surge in the first three quarters of 2007.

ThyssenKrupp's pretax profit for the year ending in September rose by 27.1%, to 3.3 billion euros ($4.9 billion), from 2.6 billion euros ($3.8 billion), a year earlier, driven by a record performance for its stainless steel business, where profits rose by 83.7%, to 777 million euros (1.1 billion).

However with analysts expecting profits of 3.5 billion euros ($5.1 billion), the news sent its shares plunging 2.04 euros ($3.00), or 5.1%, to 37.97 euros ($55.86), on Tuesday morning in Frankfurt.

Michael Tappeiner, an analyst at WestLB Research in Frankfurt, said that the results were weighed down by higher-than-expected ramp-up and restructuring costs, as the company embarked on major expansion programs in Brazil and the U.S.

ThyssenKrupp's elevator business delivered the weakest performance, with a strong euro having a negative impact on the results. The division was also slapped with a 480 million euro ($706.2 million) fine for violating EU cartel regulations.

Though higher prices and demand gave its stainless steel division a strong boost, particularly in the first three quarters of the year, the company was cautious about 2008, saying it expected demand for stainless steel to "normalize." The stainless steel industry is expected to face heavy increases in the price of its core raw materials, iron ore and coal.

ThyssenKrupp (other-otc: TYEKF - news - people ) said it expected its 2008 pretax profit to come in at around 3 billion euros ($4.4 billion), compared with the 3.3 billion euros ($4.9 billion) recorded in 2007.

"The results were clearly below expectations and the outlook is simply in line with expectations," said Tappeiner. "Based on that, you have a negative share price performance."

But there are some positives which should lead to a bounce back. The company announced an increase in its annual dividend payment to 1.30 euros ($1.91 euros) a share, from 1.00 euros ($1.47), a year earlier.

Analysts were also upbeat about ThyssenKrupp's outlook, pointing to the long-term nature of many of its contracts, and success in its capital goods and services.

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