German industrial giant Thyssenkrupp raised its annual forecast on Tuesday and reported a smaller quarterly loss than last year thanks to strong demand from China.

The Essen-based group, which is in the throes of a painful restructuring, is now expecting an adjusted operating profit in the "three-digit million euro range" in the 2020-2021 period after previously predicting it would "almost breakeven".

Sales are expected to grow "in the low two-digit percentage range", compared with a previous "single-digit" estimate, but will remain well below pre-pandemic levels, the company said.

"We made up more ground in the second quarter," chief executive Martina Merz said in a statement.

The company reported a net loss of 211 million euros ($256 million) for the quarter compared with 948 million for the same period last year.

The long-struggling conglomerate, which employs around 100,000 people, last year sold off its lucrative elevator business to fund a turnaround plan that will include 11,000 job cuts.

The coronavirus outbreak compounded Thyssenkrupp's woes, pushing it deep into the red in its 2019-2020 fiscal year as lockdown measures closed dealerships and disrupted production at factories around the world.

But the group said economic activity picked up in the final stretch of 2020 and it saw strong demand for car parts and industrial components used in wind energy, particularly in China and Germany.

Thyssenkrupp is now seeing the continuation of this recovery started in the first quarter, once again driven by demand in China, it said.

However, weighed down by restructuring costs, the group still expects to make a net loss of several hundred million euros again this year.

fcz-fec/hmn/lth

THYSSENKRUPP

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