Projected Sales for Thyssenkrupp Lead to Sharp Drop in Shares
Thyssenkrupp, the German conglomerate, is currently facing a challenging period, with the company expecting a revenue decline of five to seven percent for the full year. This decline is attributed to the weak market environment in key industries such as automotive, machinery, and construction, which have had a negative impact on the company's performance.
In particular, the steel division has seen a weak performance, with EBIT decreasing by 69 percent to 31 million euros. However, there is a silver lining in the form of Thyssenkrupp Marine Systems (TKMS), the only division to have increased its revenue. TKMS's order intake rose by approximately 20 percent to a record high of 10.1 billion euros, and the division increased its revenue by 14.2 percent to 500 million euros.
The defense sector contributed an order value of three billion euros to TKMS, benefiting from the defense boom. Adjusted EBIT increased by four percent to 155 million euros, although it fell short of analysts' expectations of 192.3 million euros. Despite this, the planned spin-off and IPO of TKMS later this year are fueling investor optimism.
The spin-off of TKMS from Thyssenkrupp AG, approved in August 2025, aims to give TKMS entrepreneurial independence to enhance innovation, flexibility, and market responsiveness. TKMS will operate as a publicly listed company specializing in maritime defense. The spin-off aligns with Thyssenkrupp’s strategy to focus on core holdings, allowing TKMS to operate as an entrepreneurially responsible entity, potentially improving revenue through more agile operational management.
Thyssenkrupp shareholders will receive one share of TKMS for every 20 Thyssenkrupp shares they hold, making them direct owners of TKMS shares and exposing them to its market performance as an independent entity. TKMS’s listing on the regulated market of the Frankfurt Stock Exchange is planned shortly after mid-October 2025, providing direct market valuation and liquidity for TKMS shares.
The majority ownership by Thyssenkrupp (51%) retains strategic control while allowing TKMS market access, which could positively influence investor confidence and stock performance due to clearer strategic focus and operational independence. Market reception likely depends on investors’ confidence in TKMS’s ability to capitalize on its strong order book and innovation freedom, but early sentiments seem positive given the emphasis on flexibility and growth opportunities by management.
Unfortunately, Thyssenkrupp's stock temporarily lost more than ten percent on Thursday morning due to the weak performance and revenue decline expectations. However, DER AKTIONÄR has a positive outlook for TKMS, with a target price of 13.50 euros.
In summary, the TKMS spin-off is anticipated to enhance revenue growth through operational independence and focused investment, while the stock performance will benefit from separate market listing, shareholder distribution of shares, and improved strategic clarity for both entities. The restructuring of the struggling steel division is also seen as a potential positive factor for Thyssenkrupp.
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