FRANKFURT, Jan 23 (Reuters) - Thyssenkrupp Chief Executive Heinrich Hiesinger told Euro am Sonntag that consolidation in the European steel industry may happen through partnerships rather than takeovers.
Thyssenkrupp plans to play an active role in the process of consolidation, Hiesinger told the paper.
“In my opinion this will not happen through acquisitions, but through partnerships,” Hiesinger said, adding that the company’s steel business in Europe had managed to double its operating profitability in the year ended September.
The industrial group is sticking to its full-year guidance, Hiesinger said.
“We stand by the forecast,” Hiesinger told the German weekly.
In November, Thyssenkrupp forecast earnings before interest and taxes in a wide range of 1.6 billion euros to 1.9 billion euros for the coming financial year, against 1.68 billion euros in 2014/15, adding that sales should be flat on a comparable basis.
Germany’s Thyssenkrupp wants to reduce debt and strengthen its balance sheet, Hiesinger told the paper.
The company continues to make progress in its turnaround plan to cut costs amid continued pressure on steel prices. Excluding currency and tax effects, the company made an operating profit at its operations in Brazil, Hiesinger said, adding that a sale of the business was currently not realistic.
Thyssenkrupp had further managed a turnaround of its AST operations in Italy, Hiesinger said.
Thyssenkrupp, with 19th-century roots in German steel, has been transforming itself into a diversified industrial group, with three quarters of its sales now coming from capital goods such as elevators, car parts and components for energy plants.
Hiesinger said Thyssenkrupp plans to improve the order intake at the company’s plant technology division while seeking to maintain revenues at the year-earlier level.
The company has no plans to spin off or float its elevator business, Hiesinger said. (Reporting by Edward Taylor; Editing by Dale Hudson)