Thyssenkrupp's elevator unit and IPO candidate posts margin drop in second quarter
Reuters
Published May 14, 2019 06:34
Thyssenkrupp's elevator unit and IPO candidate posts margin drop in second quarter
FRANKFURT (Reuters) - Thyssenkrupp's elevator unit, which the conglomerate plans to list as part of a fresh turnaround plan, saw operating margins contract in the second quarter due to higher material costs that also hit Swiss peer Schindler.
Elevator Technology, Thyssenkrupp's most successful business division, saw its adjusted earnings before interest and tax (EBIT) margin fall to 10.6% in the second quarter, down from 11.6% a year earlier, Thyssenkrupp (DE:TKAG) said on Tuesday.
Second-quarter adjusted EBIT fell 3% to 198 million euros (172 million pounds) at the unit, "mainly due to material and selling price trends in the USA owing to tariffs on material imports, and in China", Thyssenkrupp said.
The steel-to-submarines conglomerate last week unveiled a new plan to revive its beaten stock, giving up an eight month-old plan to spin off its capital goods business and instead deciding to float elevators.
The unit, which also competes with Finland's Kone and United Technologies (NYSE:UTX) Corp's Otis, is Thyssenkrupp's crown jewel and investors have long demanded that it needs to be listed, merged with a peer, or sold.
The division's sales and order intake rose in the January-March period, however, with demand coming from Europe and the United States. On a group level, adjusted EBIT fell 29% to 353 million euros, with elevators accounting for 56%.
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Written By: Reuters
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