Thyssenkrupp today posted a sharp drop in first quarter profits as global economic woes and trade conflicts drove up costs.
The German conglomerate said income before tax fell 33 per cent to €215m (£189m) in the three months to the end of December.
Net sales at the firm ticked up two per cent to €9.7bn with order intake growing, but adjusted earnings dropped in line with expectations.
Thyssenkrupp blamed a raft of macroeconomic woes for the weak update. Higher start-up costs for customer projects impacted its components technology, the firm said, while higher material costs in China and tariffs on imports into the US also took their toll.
The engineering giant was also hit by lower volumes and higher costs in its discontinued steel operations, which it blamed on low water levels in the Rhine and new vehicle emission standards.
The discontinued Steel Europe division, which is currently under investigation amid claims it was involved in a cartel to raise price, saw income before tax drop 25 per cent to €87m.
Yesterday it emerged Thyssenkrupp’s new steel venture with Indian giant Tata Steel could also be at risk, as EU antitrust regulators are expected to raise concerns about competition.
The update comes ahead of a planned separation of the group, which will see its elevators and car parts operations spun off into one division.
Despite costs linked to this plan, Thyssenkrupp confirmed its full-year earnings forecast of more than €1bn, though it warned of growing economic and political uncertainties.