Klöckner & Co Reports Increased Losses Amid Declining Sales

Klöckner & Co has reported a significant net loss for Q3, with losses deepening compared to the previous year. The decline in sales, primarily driven by lower steel prices, raises concerns about the company's financial stability moving forward.

Date: 06-11-2024

AI Rating: 4

Klöckner & Co (KCO) has reported a net loss of 29 million euros in the third quarter, a substantial increase from the previous year's loss of 12 million euros. This significant rise in losses may impact investor confidence and the stock price negatively.

The loss per share from continuing operations also worsened, reaching 0.29 euros compared to the previous year's loss of 0.04 euros. This further indicates declining profitability and could lead to reduced interest from potential investors.

In terms of operational performance, the company reported an adjusted operating income (EBITDA) of 21 million euros, down from 44 million euros the previous year. This decline in operating income suggests challenges in managing costs effectively amid a falling sales environment.

While Klöckner & Co did increase shipments to 1.1 million tons (up 2.8% year-over-year), this was not enough to offset the decrease in sales, which fell to 1.65 billion euros from 1.76 billion euros, largely due to lower steel prices. The drop in revenue indicates weakening demand or price pressures, which could further affect the company's future performance.

Looking ahead, the company is forecasting EBITDA before special effects for fiscal 2024 to be between 120 million euros and 180 million euros. While this forecast may suggest some optimism, the current circumstances raise questions about the feasibility of meeting these targets, particularly in a challenging market environment.

Stocks: KCO