PDF (10.9MB) - ThyssenKrupp AG
PDF (10.9MB) - ThyssenKrupp AG
PDF (10.9MB) - ThyssenKrupp AG
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Management report on the Group<br />
2.1 Management report on the Group Profile and strategy<br />
Page 56<br />
54 | 55<br />
Increasing value through growth, efficiency, capital employed<br />
TKVA can be increased using three levers: profitable growth, higher operating efficiency, and optimized<br />
capital employed. A major contribution to profitable growth and thus to the value of the company is made by<br />
investment projects that generate returns higher than their cost of capital. Higher operating efficiency and<br />
optimum capital employed are also aims of the new impact program. With it we will increase EBIT, reduce<br />
net working capital and so sustainably improve TKVA.<br />
The results of the analysis of the performance indicators feed directly into portfolio management. Group<br />
management decides which businesses are to be expanded to realize set TKVA targets, and which activities<br />
we should withdraw from in a timely way to protect value.<br />
Value-added impacted by impairment charges<br />
In calculating TKVA we applied the new definitions of EBIT and capital employed for the first time from<br />
2010/2011 and adjusted the prior-year figures.<br />
In the past fiscal year <strong>ThyssenKrupp</strong> generated highly negative value-added of €(2,962) million. This was<br />
caused by the high impairment charges in the Steel Americas and Stainless Global business areas, which<br />
weighed heavily on EBIT of the <strong>ThyssenKrupp</strong> Group. In addition, average capital employed increased yearon-year<br />
by €2,456 million in 2010/2011, mainly due to the major investments in the Steel Americas and<br />
Stainless Global business areas. The value-added figures of the other six business areas were strongly<br />
positive and in most business areas were considerably up from the prior year, mainly due to higher<br />
earnings. Details on the value-added ratios are shown in the table below.<br />
Components of <strong>ThyssenKrupp</strong> Value Added (TKVA)<br />
EBIT<br />
(million €)<br />
Capital<br />
employed<br />
(million €)<br />
2009/2010 2010/2011<br />
WACC<br />
(%)<br />
TKVA<br />
(million €)<br />
EBIT<br />
(milion €)<br />
Capital<br />
employed<br />
(million €)<br />
WACC<br />
(%)<br />
TKVA<br />
(million €)<br />
Change<br />
TKVA<br />
(million €)<br />
Group<br />
Thereof:<br />
1,346 20,767 8.5 (419) (988) 23,223 8.5 (2,962) (2,543)<br />
Steel Europe 731 5,370 9.0 248 1,133 5,822 9.0 609 361<br />
Steel Americas (600) 5,678 9.0 (1,111) (3,145) 7,416 9.0 (3,813) (2,702)<br />
Materials Services 463 3,179 8.5 193 478 3,430 8.5 186 (7)<br />
Elevator<br />
Technology 646 2,307 8.0 461 801 2,243 8.0 621 160<br />
Plant Technology 401 365 9.0 369 506 245 9.0 484 115<br />
Components<br />
Technology 252 2,647 9.0 14 543 2,796 9.0 291 277<br />
Marine Systems 145 1,174 9.0 39 213 1,334 9.0 94 55<br />
Stainless Global (57) 2,948 9.0 (323) (785) 3,356 9.0 (1,087) (764)<br />
The TKVA of Stainless Global in 2010/2011 includes an impairment charge of €510 million in accordance<br />
with IFRS 5. The TKVA of Materials Services in 2010/2011 includes an impairment charge of €48 million in<br />
accordance with IFRS 5.