Thyssenkrupp AG Business Report FY2007-08
Business Highlights
Financial Overview
(in million euros) |
FY2007 -08 |
FY2006 -07 |
Rate of change |
Remarks |
Overall | ||||
Sales | 53,426 | 51,723 | 3.3% | Overall business performance was in line with its expectations and in some areas better, even though the market environment was increasingly difficult. |
Earnings before taxes | 3,128 | 3,330 | (6.5%) | - |
Segment review (Selected)
(in million euros) |
FY2007 -08 |
FY2006 -07 |
Rate of change |
Remarks |
Steel Segment | ||||
Sales | 14,358 | 13,209 | 8.7% | The increase was primarily due to rising prices, although shipments were also higher than a year earlier. |
Earnings before taxes |
1,540 | 1,662 | (7.3%) | Earnings before taxes were 122 millions euros lower than a year earlier but higher than its expectations thanks to the positive performance of high-value products. |
- Auto | ||||
Sales | 5,106 | 4,800 | 6.4% | Due to higher prices in contract business. |
Stainless Segment | ||||
Sales | 7,420 | 8,748 | (15.2%) | Mainly as a result of lower selling prices. |
Earnings before taxes |
126 | 777 | (83.8%) | Due to the dramatic price falls for nickel and alloyed scrap, earnings were down significantly from the previous year. |
Technologies Segment(*) | ||||
Sales | 12,412 | 11,523 | 7.7% | Based on the good order situation, sales in the reporting year also improved. |
Earnings before taxes |
741 | 544 | 36.2% | The segment's active portfolio management with a focus on profitable business areas is having an increasing effect. |
- Mechanical Components | ||||
Sales | 3,924 | 3,793 | 3.5% | Gains in slewing bearings and rings, particularly due to unabled growth in the wind turbine sector. |
- Automotive Solutions | ||||
Sales | 3,247 | 3,182 | 2.0% | Order intake at Automotive Solutions increased year-on-year. All operating groups played a part in this, with particular contributions coming from the body shop equipment and assembly systems group and the axle module assembly business. |
Steel Segment
-Business Restructuring
ThyssenKrupp Tailored Blanks GmbH, a subsidiary company of ThyssenKrupp
Steel AG, brings its Mexican subsidiary company ThyssenKrupp Tailored
Blanks S.A. de C.V. as a contribution into the US Joint Venture TWB Company
L.L.C. TWB was established in 1991 as a joint venture between ThyssenKrupp
Steel North America, Inc., and Worthington Industries for the production
of tailored blanks.
ThyssenKrupp Steel becomes the majority shareholder in TWB. (From a press
release on Mar. 5, 2008)
-Contracts
ThyssenKrupp Presta Steering has received a production order from
BMW to supply the steering column for the X3, 3 and 1 series models. The
company has also received a development order from BMW for the steering
gears for several future production models. This is the biggest order
in Presta's history. (From a press release on Nov. 21, 2007)
Technologies Segment
-Divestitures
As of Jan. 2008, the Sona Okegawa Precision Forging Limited acquired the
ThyssenKrupp Prazisionsschmiede GmbH from ThyssenKrupp Technologies AG.
ThyssenKrupp Prazisionsschmiede will operate under the name Sona BLW Prazisionsschmiede
GmbH.
R&D
R&D Structure
In FY2007-08, there were about 3,500 people working at the Group's 85
development centers and departments around the world to improve its products
and processes.
Interdisciplinary Center for Advanced Materials Simulation (ICAMS) began
work in Jun. 2008. ICAMS is a research institute based at the Ruhr University
in Bochum, Germany. This research institute, the only one of its kind
in Europe, will mainly work on the development of high-tech materials.
The ground breaking ceremony of ThyssenKrupp Presta TecCenter took place
in Liechtenstein/Eschen. This new facility will be ready by Sep. 2008.
(From a press release on Oct. 23, 2007)
R&D Expenditures
(in million euros) | FY2007-08 | FY2006-07 | FY2005-06 |
Basic research and development |
316 | 257 | 241 |
Customer-related development(*) |
224 | 294 | 230 |
Technical quality assurance |
301 | 264 | 272 |
Group Total |
841 | 815 | 743 |
R&D Activities (FY2007-08)
-Steel Segment
ThyssenKrupp Steel and Japan's second-biggest steel producer JFE Steel
Corporation have jointly developed a new multiphase steel for automotive
applications. It has a minimum strength of 780 megapascals (MPa), similar
to that of the advanced ultrahigh-strength steels CP-W 800 from ThyssenKrupp
Steel and NANO 780 from JFE. but with up to 40 percent higher elongation
compared with conventional 780MPa high-strength steel. Typical applications
of the newly developed steel include automotive body structural parts.
ThyssenKrupp Steel and JFE have been working together closely since 2002.
(From a press release on Jan. 25, 2008)
-Stainless Segment
The Company developed a new titanium alloy for auto exhaust systems which
can withstand temperatures of up to 1,000 degrees Celsius.
-Technologies Segment
The Company has developed bushing-less connecting rod, which permits
further progress in truck engines.
Investment Activities
(As of Sep.30) |
FY2007-08 | FY2006-07 | FY2005-06 |
Steel | 2,596 | 1,659 | 603 |
Stainless | 387 | 328 | 230 |
Technologies (*) | 763 | 581 | 600 |
Elevator | 136 | 122 | 164 |
Services | 369 | 282 | 393 |
Corporate | 66 | 131 | 88 |
Consolidation | (35) | (102) | (1) |
Group | 4,282 | 3,001 | 2,077 |
In FY2007-08, the Group invested 4,282 million euros, 43% more than a year earlier. 4,018 million euros were spent on property, plant and equipment and intangible assets, while the remaining 264 million euros were used for acquisitions.
Steel Segment
The expenditures were dominated by the two major strategic projects in Brazil and USA. The construction of the new steel mil in the Brazilian state of Rio de Janeiro accounted for asset additions of 1.7 billion euros. Around 210 million euros was spent on the construction of the processing plant near Mobile in Alabama.
Stainless Segment
ThyssenKrupp Steel USA, LLC, and ThyssenKrupp Stainless USA, LLC, broke ground on the site of its 3.7 billion USD carbon and stainless steel processing facility in Calvert, Alabama. The commencement of operations is expected to be in March 2010. (From a press release on Nov. 2, 2007)
Technologies Segment
Capital expenditures in the Technologies unit reached 763 million euros. More than half the funds were used to expand manufacturing capacities for existing and new products. Other major uses included measures to maintain existing operations and strengthen efficiency. Most of the investment was carried out in Germany, North and South America, China and India.
- Mechanical Components Business Unit
Capital spending at Mechanical Components focused on expanding production capacities and increasing efficiency. Investment was made into making final assembly of assembled camshafts more flexible. In the crankshaft area, the efficiency of forging particularly for low-cost car camshafts was significantly increased.
-Automotive Solutions Business Unit
New assembly lines for the production of mechanically adjustable steering columns were purchased and existing lines were modernized. The assembly of DampTronic shock absorbers was optimized. Investments in new automated lines will increase both production capacity and process reliability.