Thyssenkrupp grew in the second quarter of its 2021/22 fiscal year thanks to higher steel prices, but is struggling with high raw material costs.

Adjusted earnings before interest and taxes (EBIT) increased from January to the end of March to 802 million euros from the previous 220 million euros, the group announced on Wednesday.

The steel division was able to increase its operating result tenfold from 47 million euros to 479 million euros.

Thyssenkrupp raised the forecast for the entire group and now expects adjusted EBIT of at least two billion euros in the fiscal year instead of the previous 1.5 to 1.8 billion euros.

In the previous fiscal year, Thyssenkrupp had achieved 796 million euros.

The free cash flow before M&A, which attracted a lot of attention from the market, was minus EUR 772 million in the second quarter after minus EUR 750 million previously.

The sharp rise in raw material and material prices as well as delayed customer call-offs led to a temporary, strongly price-driven increase in current assets.

Thyssenkrupp had suspended the cash flow forecast in March and is now expecting a negative figure in the mid three-digit million euro range after a deficit of 1.3 billion euros.

Originally, the group had expected a balanced value.

"The dynamic development in raw material prices is currently having a negative impact on our cash flow," said Chief Financial Officer Klaus Keysberg.

However, the group assumes that the situation will improve in the following quarters.

"The return to a positive free cash flow before M&A remains our primary goal." It is therefore important to further improve the performance of the businesses.

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