FRANKFURT (AFP) – Supply chain issues troubled ThyssenKrupp in the third quarter as the industrial heavyweight posted reduced profits, impacted by rising interest rates.
The conglomerate, which runs its business year from October to September, recorded a net profit of EUR76 million, down from EUR125 million in the same period last year.
The result included an impact of “around EUR480 million “ as rising interest rates caused ThyssenKrupp’s capital costs to increase, the group said in a statement yesterday.
Its revenues rose by 26 per cent to EUR11 billion driven by “higher revenues and improved margins” in its industrial materials and steel divisions.
In both, a decrease in the volume of shipments was balanced out by rising prices for its products.
Supply chain issues which have dogged industry and held back production were more keenly felt in ThyssenKrupp’s automotive and industrial components units.
Shortages of key parts in the auto business had a knock-on effect, leading to “volatile customer call-offs”.
“Ongoing challenges and risks in our environment” meant ThyssenKrupp had to step up its performance but also presented the group with opportunities, Chief Financial Officer Klaus Keysberg said in a statement.
In June, ThyssenKrupp agreed to buy the MV Werften shipyard in the northeast German town of Wismar, following its fall into bankruptcy earlier this year.
The acquisition allowed the group to potentially expand “the construction of submarines and surface vessels” at a time when Western governments are boosting military spending in response to the Russian invasion of Ukraine.
ThyssenKrupp was also still considering spinning off its hydrogen business, as demand for the alternative to fossil fuels ballooned.
In response to rising interest rates, the group revised down its profit expectations for the current business year “to be in the high-three-digit million euro range”, having previously anticipated a figure of “at least one billion euros”.
