(RTTNews.com) - Shares of thyssenKrupp AG (TYEKF.PK) were losing around 10 percent in the morning trading in Germany on Friday after the steel giant issued a profit warning adversely affected by provisions for cartel proceedings.
The company said it now expects full-year net income of 0.1 billion euros, and adjusted EBIT of 1.6 billion euros.
In a statement, the company noted that thyssenkrupp Steel Europe AG, alongside other steel companies and associations, is the subject of ongoing investigations by the Federal Cartel Office into alleged cartel agreements relating to the product groups heavy plate and flat carbon steel.
The pending investigations concern, in particular, allegations concerning collusion in the determination of surcharges and premiums for steel prices.
The company said it takes this matter very seriously and, with external support, has conducted its own internal investigation of the matter. Based on the facts currently known, the company said it cannot exclude substantial adverse consequences with regard to the Group's asset, financial and earnings situation.
Due to new developments in the investigation process, thyssenkrupp has decided to accrue risk provisions in the consolidated financial statements. This will result in a net income for the year below the previous year's level of 271 million euros.
In addition, thyssenkrupp has decided to set aside provisions for risks arising from quality issues in the Components Technology business area. Together with production and shipping restrictions at Steel Europe in the 4th quarter and earnings at Elevator Technology below expectations in the 4th quarter, this means that adjusted EBIT in 2017/2018 is expected to be 1.6 billion euros.
The consolidated financial statements for the 2017/2018 financial year will be published as planned on November 21.
In Germany, thyssenKrupp shares were trading at 17.10 euros, down 10.31 percent.
Read the original article on RTTNews (http://www.rttnews.com/2953749/thyssenkrupp-stock-down-on-cautious-fy-profit-view.aspx)
For comments and feedback: contact email@example.com