Steelmaker ThyssenKrupp is optimistic about 2011 as the economic boom in Germany and cost cuts offset the expenses incurred by the ramp-up of new plants in its last quarter.
ThyssenKrupp benefited from a strong rebound in Germany's economy, whose engineering and automotive sectors posted huge profit margins while the construction sector remained weak.
Herman Reith, a BHF Bank analyst, says that Thyssen also gains from the favorable environment in Austria, the Netherlands, and Scandinavia. He adds that the euro-dollar rate makes exports from such countries competitive.
The German economy is way ahead of other states, with exporters' strength in rising markets helping Germany grow while domestic demand gains ground. Siemens recently showed its confidence with a sharp dividend hike and a promise of profit growth driven by growing markets, underscoring the strength of the capital goods industry in Germany.
ThyssenKrupp sees sales growth of 10 to 15 percent for its current year to September 2011, with adjusted earnings before interest and taxes (EBIT) at around EUR2 billion ($2.63 billion), compared with EUR1.2 billion in fiscal 2010.
The average estimate for 2011 sales in a Reuters polls was EUR47.45 billion, an 11.3 percent increase from 2010. [via autonews - sub. required]