May 25th, 2021 | 10:50 CEST
ThyssenKrupp, SunMirror, Siemens Energy - Putting the energy transition in jeopardy
Table of contents:
"[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
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ThyssenKrupp - Restructuring underway
After the Federal Constitutional Court declared the Climate Protection Act partly unconstitutional at the end of April, the German government significantly tightened up the new climate targets. Germany now wants to be climate-neutral by 2045, five years earlier than planned. The already ambitious targets are tough on Germany as an industrial location with its not entirely unimportant steel industry. The sector is responsible for almost a third of all industrial CO2 emissions in Germany. Instead of reducing their CO2 emissions by 55%, companies now have to cut them by 65% by 2030. ThyssenKrupp is faced with a Herculean task and additional costs in the low double-digit billions. Management is therefore calling on policymakers not just to set new targets and make further announcements but to come up with a targeted strategy for achieving the best way of protecting the climate while at the same time maintaining competitiveness.
Fundamentally, the industrial Group was recently able to convince with its figures for the second quarter. Increased sales of industrial components and the recovery in the automotive sector helped the Essen-based Company increase sales by 4% to around EUR 8.6 billion, 4% more than a year earlier, and post an operating profit of EUR 220 million. The previous year had seen a loss of EUR 190 million. As a result of the positive developments, the Company increased its forecasts for the year. A double-digit sales growth is expected at the end of the fiscal year in September, and in terms of operating profit, CEO Merz envisages a mid-three-digit million euro figure.
The Supervisory Board gave the CEO the green light to press ahead with the spin-off of the steel operations from the Group as a whole. The declared aim is to make the steel division of the mining group, which is in crisis, competitive again under its own steam. The result could be a spin-off or an independent subsidiary with its own financing. A merger with other steel producers, on the other hand, would be out of the question. Despite the encouraging news, the share continues to consolidate in the EUR 9.50 range. After a tripling of the share price since November 2020, we await further developments.
SunMirror AG - On the pulse of time
The Swiss multi-asset manager SunMirror wants to answer where to get the essential and scarce metals to cope with the energy transition. The Company focuses on the strongest long-term growth drivers through new technologies, such as the renewable energy sector and the electrification of transport. By investing in unique and, due to high demand, rather critical commodity projects that include important industrial metals or rare earths, SunMirror aims to build a portfolio that is well equipped for the energy transition.
Currently, the Swiss Company operates three properties in Australia and focuses on gold in addition to lithium, tin, nickel and iron ore. Recently, the analysts of Sphene Capital attested the share further potential up to a level of EUR 174.30, an upside potential of more than 20% to the current price at EUR 149.
The successful placement of a EUR 10 million convertible bond with maturity until mid-2022 shows that the Company is fully in line with the trend. As the subscription price of CHF 70 is significantly below the current price, the entire amount should flow into the Company's equity after conversion. In addition, SunMirror reported a letter of intent from an investor, Barracuda Group, to subscribe to a capital increase of 1 million shares. The expansion of the portfolio is expected to accelerate after the successful capital increase. The issue hits the nail on the head.
Siemens Energy - The calm after the storm
Calm has returned to the Company's headquarters following the short-term suspension of the share price of its subsidiary Siemens Gamesa last week. Spanish media reported that the parent Company Siemens Energy wanted to take the Company off the stock exchange. Siemens Energy already owns 67% of the Group. The latter denied the report but did not rule out a future takeover.
The step would also be more than logical due to the upcoming restructuring. While Siemens Energy should expect interest in gas turbines to continue to flatten out in the future, the offshore wind power sector, where subsidiary Siemens Gamesa is the market leader, should remain in strong demand. From a chart perspective, the stock, which is currently trading at EUR 25.92, is on the verge of a buy signal. Overcoming the resistance at EUR 26.50 would result in a short-term potential of 20%.
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