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(Corrects currency in headline.)
Dec. 2 (Bloomberg) -- ThyssenKrupp AG, Germany’s largest steelmaker, posted a fiscal full-year loss because of 2.9 billion euros ($3.9 billion) of impairments charges, mostly after construction of a plant in Brazil was delayed.
ThyssenKrupp posted a loss before tax and interest of 988 million euros in the year ended Sept. 30, compared with a 1.4 billion-euro profit a year earlier, the company said in a statement today.
ThyssenKrupp booked impairments after the construction of the plant in Brazil went over budget and production was delayed, on the strength of the Brazilian currency and the “renewed weakness” of U.S. and European markets. Its stainless unit contributed 800 million euros to the writedown.
“We visited the Brazilian plant in October and at that time the local management was quite frankly admitting that the coking plant, and as a consequence the power plant, weren’t running as planned, so this is not hot news in our view,” Marc Gabriel, an analyst at Bankhaus Lampe, in Bielefeld, Germany, said in a note today.
Rising raw-material costs and falling steel consumption have hobbled producers’ efforts to emerge from the industry’s worst crisis in 60 years after the global recession caused demand to collapse. Thyssenkrupp fell as much as 4 percent to 18.25 euros in Frankfurt trading and was at 18.665 euros at 11:39 a.m. It was the only declining stock in the 10-member Bloomberg Europe 500 Steel Index.
Hans Fischer, who heads ThyssenKrupp’s Steel Americas business, is leaving the company, the Financial Times Deutschland reported earlier, citing unidentified people. Fischer, who joined Essen-based ThyssenKrupp from Salzgitter AG in February 2010, wants to take on a new task in another company, the newspaper said.
ThyssenKrupp experienced faulty construction at its steel plant in Brazil, Handelsblatt reported, citing unidentified people close to the company. A new coke oven built by China’s Citic Group probably won’t reach full capacity because of the problem, the newspaper said.
ThyssenKrupp has asked Citic for compensation and while the Chinese company has in principle agreed to shoulder part of the costs, the two companies haven’t yet agreed on the amount, Handelsblatt reported.
Citic spokesmen couldn’t be reached at their offices by telephone after normal Beijing office hours.
The steelmaker called a press conference for 2 p.m. in Essen to discuss decisions taken by its supervisory board, said a company spokesman who declined to be identified by name according to corporate policy.
ThyssenKrupp had been scheduled to report earnings on Dec. 6. The spokesman declined to comment on the report that Fischer is leaving.
The board has decided to maintain dividend continuity and proposes an unchanged payment of 45 euro cents a share for the last fiscal year, the company said in its statement today.
--Editors: John Viljoen, Alex Devine
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