Thyssenkrupp : Charts Telefonkonferenz 2. Quartal 2023/2024 (nur in englischer Sprache)

Q2 2023/24 Results

Conference Call

Ticker: TKA (Share) TKAMY (ADR)

May 2024 | Essen

Management summary Q2 23/24

Portfolio

• Steel Europe: First step towards 50/50 Joint Venture achieved - EPCG acquires 20%

• Marine Systems: Due diligence phases progressing (KfW, PE) as well as spin-off in elaboration

• Decarbon Technologies: Board set-up completed; closing of transaction of the remaining 55% stake in tk Industries India (POL)

Performance

Green Transformation

• Q2 in line with expectations, full-year guidance confirmed for EBIT adj. and FCF bef. M&A
• APEX well on track with incremental improvements across all businesses
• Steel Europe: Structural realignment to boost competitiveness and profitability in preparation
• Materials Services: Start of fundamental structural transformation of tk Schulte's business model
• Uhde: Development of conceptual design study for reduced-emission fertilizer plant (EnviNOx®)
• Polysius: Start of construction of one of the 1st carbon-neutral cement plants ("pure oxyfuel")
• thyssenkrupp on the CDP "Climate A List" for the 8th time in a row
• No 1 position (MDAX) in a buyside Corporate Governance ranking

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Steel Europe: First step towards 50/50 Joint Venture achieved

EP Corporate Group (EPCG) acquires stake of 20% and aims for another 30%

•	Signing of acquisition of 20% stake in tkSE by EPCG
•	Transaction is:
	− Expected to be closed in FY 23/24
20%	− Subject to the approval of the relevant authorities

and the Supervisory Board of tkAG

	Targeted
50%	tkSE
shareholding
	structure

30%• In negotiation (tkAG with EPCG)

• Target: Equal 50/50 Joint Venture

tkAG

EPCG

Combining materials capabilities of tkSE with the energy expertise of EPCG for the decarbonization of the steel industry

Create a high-performing and

profitable steel company

Reduce costs of decarbonization

to a more competitive level

Ensure economic independence

and business success

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APEX well on track

Recap: APEX launch in Nov-23

APEX Q2 status update

• Solid APEX governance and functional processes set up

− Measures within segments & corporate defined

− Effective cross-segment approach used to define large-scale initiatives (e.g. procurement, digitalization)

• More than 4,600 measures identified with value of ~€1.8 bn (from ~€1.3 bn in Q1)

• Significant momentum achieved while implementation is progressing

APEX is the key enabler to achieve our mid-term targets

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Performance highlights

Well on track to reach full-year guidance

Sales

Q2 €9.1 bn

-10% YoY

H1 €17.2 bn

-10% YoY

EBIT adj. Margin

€184 mn 2.0%

-10% YoY

€268 mn 1.6%

-28% YoY

FCF bef. M&A

-€197 mn

+€20 mn YoY

-€728 mn

-€146 mn YoY

Margin increase in Q2 - Earnings development of all	Q2 FCF bef. M&A still negative, but improved YoY
businesses as expected

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Balance sheet highlights

Our Group transformation journey is backed by a strong balance sheet and enabling us to capture strategic opportunities

Net cash

€3.5 bn

-€0.9 bn YTD

Pensions

€5.8 bn

+€0.4 bn YTD

Lower QoQ

(-€0.2 bn)

Equity ratio

37.6 %

-0.5%-pts. YTD

Providing resilience while navigating through macro uncertainties	Interest rate development i.a. driving pensions and equity ratio

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Q2 Group performance

Efficiency measures and increased resilience fully offset top-line trend

Sales		-10%
€ bn	10.1	8.2	9.1

• Materials businesses significantly lower (price and volume), partially offset by stronger sales at Decarbon Technologies
• Ongoing muted demand (e.g. auto, construction, wind China)

EBIT adj.

€ mn; %

	-10%
205	Pos. one-timer	184
	84
2.0%	1.0%	2.0%

• Top-linetrend compensated by efficiency measures and increased resilience
• Performance improvements gaining momentum
• APEX supported performance at all businesses
• PY affected by positive one-timer at Automotive Technology (mid 2-digit €mn)

FCF bef. M&A

+20

• Fully in line with expectations

€ mn

• Weaker H1 with typical seasonality - uptick in H2

-216

-197

• On track to achieve full-year guidance

-531

Q2 22/23

Q1 23/24

Q2 23/24

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Q2 EBIT adj. by segment

Sound performance across the group in an ongoing challenging market environment

					25				YoY segment comments
				68
							184	AT	Rather stable ex PY one-timer: Lower material
						-42
								and transport costs vs. volume decline, higher
									personnel expenses and non-conformity costs
			69					DT	Performance and efficiency measures only
									partially compensate weak wind market and
									business ramp-up at tk nucera
						Margin	2.0 %	MX	Lower average price levels and shipments
							partially offset by e.g. lower freight costs
		15						SE	Cost improvements (mainly energy and raw
	49
								materials), partially offset by lower spot market
									prices and lower shipments
								MS	Successful focus on performance improvement;
									initiatives secure margins in new orders and
	AT	DT	MX	SE	MS	HQ/	Group		stabilize profitability of order backlog
						Others
∆YoY	-60	-34	-16	+83	+11	-5	-21

PY with positive one-timer

(mid 2-digit € mn)

Note: Figures in € mn

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Outlook FY 23/24

Sales

EBIT adj.

FCF bef. M&A

FY 22/23	Outlook FY 23/24
€37.5 bn	Below the prior-year
(prior: At the prior-year level)

High 3-digit € mn range

AT Up; low-mid3-digit € mn range

DT Largely stable

€0.7 bn

MX Up; low 3-digit € mn range

SE Largely stable (prior: Up; mid 3-digit € mn range)

MS Up; high 2-digit € mn range

€0.4 bn	Low 3-digit € mn range

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Q&A Session