thyssenkrupp AG (TKA) Earnings Call Transcript & Summary

Ladies and gentlemen, shareholders, I hereby open the 21st AGM of thyssenkrupp. On behalf of the Supervisory Board and of the Board, I'd like to welcome you. First of all, I have to mention that all Board members are present and all members of the Supervisory Board as well, upfront. A few important pieces of information. According to our articles, I have given permission to have a full transmission in the Internet office AGM so that everybody can participate. The report of the AGM as well as the speeches will be available on our website afterwards. This has been invoked correctly with all the information that was necessary for the shareholders, and it was published in the official gazette in September of 2019 and has been published Europe-wide. As in the previous year, Dr. [ Erihgner ], our notary public, will be recording the findings of this meeting as well as the outcome of all of our elections and votes. Any important information on how we proceed in this AGM, you will find in the information packet that was given to you this morning, and that has been in the public domain on our Internet page since January 17 this year, as in last year. And this year, we will do our voting using tablet computers. So please make sure you heed the advice and the information. However, before we proceed to the voting, I will explain it one more time and make sure you heed the information on what to do when you leave the room and if you want to give power of attorney to somebody else to do the voting for you. I should like to point out at this point of time that you can only vote for those shares for which you have registered your ticket at the entrance. So if you have more than one ticket, please have them registered at the counter. If you wish to take the floor, please give notice in time at the desk on my left-hand side. Shareholders, ladies and gentlemen, before Mrs. Merz will speak on the business here of 2019 -- 2018, 2019, let me make a remark as well. This, again, was a year with many turbulences. Since the last AGM, many events have shaped the development of the company and also the work of the Supervisory Board. The entire previous financial year was marked by a great deal of challenges and uncertainty. The joint venture we were hoping for with thyssenkrupp Steel with Tata Steel was not approved by the EU commission. The economic situation at that time and now has taken its toll on the situation of thyssenkrupp and also our own strength. Many fields have not been at the level of our competitors and not at the level that we have been planning for at the beginning of the year. All of this led to the fact that the split up of thyssenkrupp into 2 business units could not be carried out and was, in fact, canceled. At the end, a very intense discussions on -- with the Board and the Supervisory Board, we understood that to make sure we secure the future of thyssenkrupp we need to sell the elevator units, either in the way of an IPO or selling it to a competitor. That's not an easy step, but we need the finances in order to be able to act again. The financial situation of thyssenkrupp needs to be strengthened to get our business in shape and to be in a situation where we can transform the business. Therefore, this is an important step, even if it may hurt. Ladies and gentlemen, towards the end of the business year, the Supervisory Board decided that we needed new faces on the Board in order to carry out the new strategies and to bring about a future development of the company. Therefore, the Supervisory Board came to a conclusion with Guido Kerkhoff and we decided. And at this point of time, I should like to point out Mr. Kerkhoff, in 2018, took over in a very difficult situation. In times of uncertainty, he went ahead and I think we have to pay him our respects. I thank Guido Kerkhoff for his commitment, his work, over more than 8 years on the Board of thyssenkrupp. But at the same time, I must point out that in September of last year, we had different views regarding the situation of thyssenkrupp and what to do. The Supervisory Board thought that the analysis of the company by the Board was too optimistic, not realistic, and therefore, also the assumptions as to what funds were necessary to solve the problems. And the Supervisory Board had doubts regarding the speed of the plan of action. And then the Supervisory Board considered that the process to assess different options of the Elevator transaction needed a different approach. At the same time, it was obvious that thyssenkrupp did not have the time to look for a new head of the Supervisory Board of the Board and to convince him or her to wait when that person would be available and provide the time to obtain his or her own opinion. So the lack of speed, of course, was part of the problems that we had of -- in the past. And I have to admit that up until then, Chapter 105 of the German shareholders was known to me. Those of you who just as I'm familiar with it, as I used to be that in certain situations, in certain cases, the Supervisory Board may choose a member from amongst their midst to second a member of the Supervisory Board to the Board. And the Supervisory Board made use of that and Martina Merz was then chosen unanimously as the transitionary head of the Board. She has a very clear vision of the situation. She knows what to do. She understands the situation. And she breaks it down into clearly structured plans of action. And with her empathy, people may follow her on a very difficult path that lies ahead of us. We, here at the Supervisory Board, are very grateful to Martina Merz that she has accepted this challenge in September. From the point of view of the Supervisory Board, this was the right decision. And the past 4 months have confirmed that we were right in our decision. We, the Supervisory Board, are very happy with the new relationship with management, with their assessment of the situation, with their meticulous understanding of the situation and the right sequence of decision-making and of course, the right speed with which the management will actually tackle the situation. It would be great if I could get the remainder of my speech. I'm in the hand of my support team. But there we go, I'm not quite through that I need another page. Thank you very much. So again, we're happy with the speed and even though this is something that was not perhaps perceived as such by the general public, it's also because the confidentiality, of course, makes us not talk about things very publicly. And that's good, so. The Supervisory Board supports management and the decisions and the strategy that Mrs. Merz is going to talk about. And now, Mrs. Merz, it's over to you for your report on the previous financial year and the outlook for the future. Thank you very much.

Thank you. Good morning, ladies and gentlemen, shareholders. On behalf of the Executive Board, I welcome you to this year's Annual General Meeting of thyssenkrupp AG. A year ago, our joint expectation was that I would be reporting to you today on the work of the Supervisory Board. As we all know, things have turned out differently. thyssenkrupp is in an extremely difficult situation. That's why I complied with the request of the Supervisory Board to assume overall responsibility as CEO for a limited period of time. Professor Russwurm has just explained it. Ladies and gentlemen, the challenges are great. Our balance sheet remains weak and the performance of some of our business remains unsatisfactory. So we have no time to lose. We are, therefore, working swiftly and systematically on a new thyssenkrupp AG. We're looking ahead unencumbered and focusing on what is doable. We are, therefore, working swiftly and systematically on a new thyssenkrupp AG. We, on the Executive Board, are working closely together with the Supervisory Board on this. Only in this way can we win back the trust of our employees, of you, our shareholders and our business partners. And it is for this task that I, and we, have stepped up as the new Executive Board. We have a commitment to our more than 160,000 employees worldwide, just as we have a commitment to you, our shareholders. We all share the same goal: We want to create a thyssenkrupp that makes money, that pays dividends, operates in a climate-neutral way and offers its employees long-term prospects. The good news is, we have largely completed the analysis phase of our new tk strategy. We have started the implementation and are also making good progress. The Executive Board is working with a more effective allocation of responsibilities. Since the beginning of the year, we have started working in a new leaner organization. We are currently downsizing the group headquarters significantly. The Executive Board, the CEOs of the businesses and the heads of the corporate functions are working together close to our operations and pulling in one direction. The Elevator transaction is on schedule. The negotiations with the employee representatives on the strategy for the steel businesses are in full swing and numerous restructuring measures have already been initiated. Not everything that is changing is visible today, and there is still much ahead of us. After a good 100 years in office, I want to give you an update today on the current state of progress. Where do we stand? What are we doing? Where do we see ourselves? For us, these are the most important questions, of course. So first off, I will give you our analysis of the situation. Afterwards, I will explain what we're doing to make our business fit for the future. And I will describe how we see thyssenkrupp in the long term. Let me talk about the situation first. thyssenkrupp that I experienced when I took over went through a phase of great uncertainty: 3 profit warnings, a prohibited joint venture, the canceled split, the relegation from the DAX. All these left marks, not only on the balance sheet, but above all, on our understanding of what we are and what we can do. What many of us forget in this thyssenkrupp as very few other companies stands for top engineering work. And according to our claim, engineering tomorrow, together. That's what we stand for. This extends from the latest developments, for example, in special grippers for assembly robots or in production processes for lightweight car bodies, to our Alfred artificial intelligence, all the way to the world's first successful trials using hydrogen as a reducing agent in the blast furnace. Ladies and gentlemen, thyssenkrupp can do things that make my engineers' heart beat faster. We are proud of our more than 160,000 employees worldwide. Their passion for the company and their tireless efforts are not things that can be taken for granted in view of our difficult circumstances. That impresses me. That's what is so special about thyssenkrupp. I would like to start by thanking our team for this, for persevering, for continuing and currently also for your support on our way forward. Thank you very much to all of you out there. Unfortunately, despite all the enthusiasm for our capabilities, our starting situation also includes the sobering view of the company's current operating performance. Our company is not delivering the performance that you, as shareholders, expect from us. The company is in the red. We have had a negative cash flow for years. In the past fiscal year alone, we spent over EUR 1 billion more than we earned. Although there are many good starting points for improvements, far too few have been implemented thus far. One main reason for this is obvious, our financial leeway has been massively restricted for many years. In the past, thyssenkrupp has always aimed to develop its businesses into industry leaders. And we, together with the managers of our units, continue to believe that we already have many of the ingredients necessary for this. However, financially, we have been unable to provide sufficient support for the group and the individual businesses to achieve their goals because we simply lack the funds to do so. For me, as someone who joined the Supervisory Board just over a year ago, first, as a member and then as chairwoman, the picture is as follows. Thyssenkrupp is like a big ship that has run into shallow waters. Over the years, there have been various attempts to turn the ship around and steer it back into deeper waters. All in vain. Given thyssenkrupp's deep draft, the shallow water did not allow any significant changes in direction. In recent years, the strong economy has also helped keep the company reasonably stable. But for some time now, the economy has been against us. As a result, the water under our keel is becoming increasingly shallow. We can see this from our weak balance sheet. In the past fiscal year, thyssenkrupp's net debt increased by more than half. We are heavily burdened by high liabilities and pension obligations running in the millions. At the same time, our equity base is becoming increasingly thin. Our equity ratio is only 6.1%. I don't need to explain to you why an industrial company, this is too low in the long term. In short, thyssenkrupp is in an extremely tight financial situation. Paying a dividend would not be justifiable in this situation. The company needs all available funds. That's why, together with the Supervisory Board, we are proposing that no dividend be paid for the past fiscal year. We are aware that this cannot be satisfactory for you as shareholders. Ladies and gentlemen, weak performance and a weak balance sheet are hindering the company's development. The ship thyssenkrupp is increasingly unmaneuverable in its current configuration. But we want to pay a dividend again in the future. We, therefore, cannot afford to just tinker with the symptoms. We must not shy away from extensive structural changes. And that is one of the reasons why I am here. And we're already doing a great deal. First of all, we are putting a stronger focus on operating performance. Our expectations of the businesses remain unchanged. All businesses must be capable of earning their cost of capital in the medium term. All of them must add substantially to the value of the company and be competitive with their industry peers. The businesses must be better able to stand on their own feet financially. How will we achieve this? As a first step, we have agreed, with the Supervisory Board, to assign businesses directly to the individual members of the Executive Board and to manage them direct -- more directly. We, as the Executive Board, are, therefore, now closer to operations. With great insistence, we are monitoring, in detail, the planning of measures, their development, their implementation and impact unit-by-unit. This will allow a genuine exchange with the management teams and enable us to better assess the situation, make decisions faster and implement restructuring measures with greater consistency. In addition, together with the managements of the businesses, we are now asking ourselves in an unbiased manner. What capabilities and resources are needed in an ideal environment to develop in the best possible way and get closer to our best competitors? This way, we will get an exact picture of what needs to be done in the individual units. Investment in new equipment, in research and development, the skill of employees, new partnerships or acquisitions, refinement of business models, but also restructuring and adjusting capacities. The result is a matrix of potentials. A complete overview of what we need in order to realize full potential of the businesses. And we will see what return we can expect from additional investments in the future. We will have done this by May. Then we can make decisions on how to proceed with the businesses, which ones we will develop on our own, which ones we think we are more likely to achieve a leading position within a partnership, or which ones will be in a better position to realize their potential and offer our employees and business partners good prospects with an owner other than thyssenkrupp. In some units, we are already pursuing a dual-track approach simply to keep our options open. Summarizing that. Together with the businesses, we are not only defining the goals, but also agreeing on the concrete path to get us there. We are working through these plans systematically and monitoring the implementation closely. The restructuring of thyssenkrupp will, therefore, not be a kind of big bang, but rather it will be a path of many small steps, which will look very different depending on the business. It is also a fact that at the moment, we have very little financial leeway. With our very weak balance sheet, we are unable to leverage the potential of our companies. So before we can turn the picture around and set a new course, we, first of all, need enough water under the keel and that is precisely why we are giving the Elevator transaction the top priority. Ladies and gentlemen, the second major focus is the Elevator transaction. Elevator is an extremely business -- extremely attractive business. Continuous growth coupled with economic resilience in a large, growing and profitable market. Elevators CEO, Peter Walker and his team, have ambitious plans for the coming years because this business of -- too offers considerable potential for margin growth. Elevator is, therefore, very attractive for the stock market but also for a partial or full sale. We have, therefore, opted for a dual-track approach and are pleased at the great interest shown by financial and strategic investors. We are on schedule for both tracks. In the meantime, we have received offers from investors. Based on an initial review, we believe that investors confirm the value of the enterprise at over EUR 15 billion. Ladies and gentlemen, some of you may be wondering why it is taking so long. Quite honestly, we're actually quite fast when you compare it with other transactions of this volume. And by preparing the IPO in parallel and obtaining offers from interested investors in stages, we have created an excellent starting point and can now select the option that is best for you, our shareholders, for our employees and business partners, but also for the Elevator business itself. The Executive Board, together with the Supervisory Board, will make this decision with all due care and taking full account of all relevant aspects. This will allow thyssenkrupp to make a real fresh start. Whichever way we ultimately decide, IPO, partial or complete sale, all of these options will generate billions of euros in capital for thyssenkrupp. This will significantly improve our situation. In the case of an IPO or partial sale, we can use the proceeds to reduce our debt considerably. At the same time, we will retain access to the cash flows and continue to profit from future value increases at Elevator. In the case of a majority or full sale, we can use the inflow of funds to reduce our burdens directly, thereby, significantly strengthening the balance sheet and placing the company's financing on a new stable footing. From then on, every euro can go towards the development of our businesses. From this basis, we can advance structurally and operationally. Whichever way we decide with the Elevator transaction, we are pressing the reset button for our balance sheet. Our expectation is that after the restructuring made possible by the Elevator transaction, thyssenkrupp will, once again, be a solidly positioned company. We aim to make the -- a decision on the Elevator transaction by the end of Feb. I hope you will understand that in view of the decision-making process, we cannot give any details of the office -- of the offers or investors today. The preparations are proceeding according to plan. The necessary restructuring measures have been completed, and the Elevator business has been organizationally independent since the beginning of the year. Ladies and gentlemen, to stay with the ship analogy. The Elevator transaction, thyssenkrupp -- with the Elevator transaction, thyssenkrupp will finally be able to float free again. We will gain enough distance from dangerous shoals and cliffs. The turning point will be painful, but it will make thyssenkrupp maneuverable again and give the remaining units the opportunity to shape their own future. That's why there is also a clear consensus between the Executive Board and the Supervisory Board about how to use the funds. We will use the proceeds to strengthen our balance sheet and thus, ultimately, to develop our businesses. In other words, we will invest them in the future of the company. We are convinced that this is the best use of the funds because we believe in the future of our businesses, and we want to utilize our opportunities. Ladies and gentlemen, many of our business areas -- in many of our business areas, we are technology leaders and hold strong market positions. At the same time, we know that there are still many opportunities for further development. And it is these opportunities that we are addressing. Allow me to provide a couple of concrete examples that illustrate the potential we have. Steel is where we started. As you know, steel is a cyclical and very capital-intensive business; a business characterized by overcapacities and higher pressures from imports; a business in which, for years, we have not been able to earn our cost of capital over the cycle. A year ago, we were all expecting our steel operations to become part of a joint venture with Tata Steel. But last year, we had to accept that the consolidation solution we planned to implement with Tata was rejected by the EU commission. Despite this decision, we remain convinced that alliances or consolidation are the best way forward for the European steel industry, with a view both to the overcapacities in Europe and the forthcoming transformation to climate-neutral steel. So we need to be open to partnerships or alliances with policymakers. But that also goes for alliance with competitors, if they offer opportunities to invest funds efficiently or find a way out of the restructuring spiral of recent years. That's why we continue to support the idea of consolidation. Alliances can offer added value. That's why we are open to discussions. But why should we invest in steel in the future? Quite simple because steel has a future. Our materials are the starting point for long industrial value chains, in particular, in Germany. Our steel is used in cars, washing machines, wind turbines. The industry, steel, is almost as important as electricity. In numerous applications, both today and in the future -- foreseeable future, there is no alternative to steel. That's why the transformation to climate-neutral steel is so important. Fighting climate change presents major challenges. But it also creates major opportunities because our customer industries are facing the same challenges. The big automotive OEMs want to become carbon-neutral, and to do that, they need green steel. If we can utilize our pioneering technologies to produce steel in a climate-friendly way, we can gain a significant competitive edge. That's why we have set out to make our steel production climate-neutral. This is a transformation the like of which has never been seen before in the steel industry. It will require billions in investment, above all, in direct reduction plants that require huge amounts of hydrogen. No company can shoulder that alone. It will depend on the efficiency of the overall steel ecosystem. That's why we are also talking with our business partners and policymakers about creating suitable boundary conditions for this major transformation. An ecosystem for green steel is a joint effort. thyssenkrupp is one of the drivers of this. You already know about the Carbon2Chem project, in which we are converting CO2 from steel mill gases into raw materials for the chemical industry. In November, we injected hydrogen into a blast furnace for the first time to replace coal as a reducing agent. Summarizing. We take our climate objectives very seriously and we are open to different technologies because there will not be just one solution. Our minimum requirement is that -- is what is technically possible. But if we are to carry out to the -- out this transformation successfully. We need to do our homework for steel. First of all, we have to make our business competitive, and that means reducing costs, aligning our processes even more with customer requirements and developing our portfolio more towards high-margin products where we have advantages over our competitors, above all those from Asia. And that is exactly what we are addressing with our steel strategy 2030. That's why the first step in this strategy will require some tough restructuring. It won't be possible to do this without job losses. Here, we need the support of our workforce. And that is why we, and the steel Board, are currently negotiating the new steel strategy with the employee representatives. Once we have reached an agreement on this, we will present the strategy in detail and then put it into practice. I am also convinced that steel has great prospects. With strong materials business, the thyssenkrupp will remain an attractive investment for you as shareholders in the future. That also includes Materials Services. This business area is already the biggest materials distributor and service provider in the Western world. Under the strategy initiated last year, we will expand our offering considerably. The market for digital supply chain services is enjoying double-digit growth. The 250,000 customers we currently have worldwide give us ideal access to share in this growth. Our automotive components business also remains an attractive investment, offering leading technologies for a variety of powertrain types. That means we can support the transformation of the auto industry as a strong partner. At the same time, we are testing new business models. carValoo is a good example. Using smart components, we are offering digital services to fleet operators, a kind of fitness tracker for cars. The patents have been granted. In collaboration with pilot customers, we have already analyzed over 1 million test kilometers. The results show how we use high-precision vehicle movements -- movement data to reliably identify all patterns of use and damage. Now we need to scale it up. Well, let's take to our plant technology business. We have already fitted more than 70 large plants with sensors and linked them to the cloud via our own digital platform. Using our algorithms, we can better help our customers optimize their plants and reduce downtimes. At the same time, we can build on our resource-friendly solutions in the cement and mining sector so that we can also support increasing focus on sustainability in these customer industries. One example, everybody is talking about hydrogen. Our water electrolysis technology can produce climate-neutral hydrogen. Opportunities for industrial components and marine systems. Our industrial components are a stable business. Our forging activities are a good example for -- of how effective well-managed restructuring can be. We grew faster than the market in this area last year. We are firmly established as the world's leading manufacturer for slewing bearings. In our Marine Systems units, we announced last year that we would be making investments of EUR 250 million to build Europe's most advanced naval engineering company. This is always assuming that German and European industrial policymakers also have an interest in this. As you can see, thyssenkrupp is not standing still. We're moving forward. We will utilize opportunities like these. Ladies and gentlemen, let's move on to the outlook. The planned Elevator transaction will be the green light for a fresh start. But this step will be just the first of several necessary maneuvers. There is still a great deal of work to be done to get the ship afloat again in all areas. It will not only have to set a new course, it will also have to get back up to speed. The necessary maneuvers are the many small steps I mentioned earlier, many of them are well underway, and I have already mentioned a few of these: the new leadership model with a stronger focus on performance; savings targets at corporate have been specified. We're halving the size of our HQ. Implementation is already underway; at automotive and plant technology, we're operating new structures; and numerous restructuring such as at Springs & Stabilizers and System Engineering. But also capacity adjustments, such as at cement and most recently at aerospace are already underway. By working closely with our businesses, we now have a much clearer picture of what resources we need to implement these plans. We will make concrete decisions on how the resources will be used once the Elevator transaction is decided and underway. And yet, it is already clear that even with a clean balance sheet, our resources will be finite. That means the businesses are in competition with each other. They will have to convince us with their plans and show us where the resources will be best utilized. It makes sense to develop those businesses that have the potential to add value. That also means that in cases where we see no prospects of closing the gap to the best in the sector or of developing businesses in a way that creates value, we will look for partners or new best owner. For example, that is why we have announced that we will be looking at the possibility of sale or alliances for our Plant Technology units. Following initial talks last year, we have now initiated the usual formal process in such cases and are sending information materials to potential interested parties. But it is too early to make a decision. So in parallel with this, we are working hard to make Plant Technology more competitive. The lesson we learned from our planned steel joint venture is never to bet too early on just one option. Ladies and gentlemen, in the future, thyssenkrupp will consist of several strong pillars: The materials businesses, the automotive components business and further industrial businesses. That means that going forward, thyssenkrupp will be managed as a group of companies with lean headquarters and strong independent units. As a result, the company will become a group that manages largely independent companies with good prospects for future success and allocates resources transparently to develop these businesses. That is the course we will set as soon as the ship, once again, has enough water under the keel, whether we are the sole owners of units or one of several in partnerships is of secondary importance. We will be guided by what best serves the businesses in these markets. What will unite all group activities -- all group companies will be our shared values. Our pride in what we have achieved and the great history of the company, held together by a strong international brand that stands for "engineering. tomorrow. together." around the world. That is a true competitive advantage. We will also be united by a new way of collaboration, taking responsibility instead of shirking it. Less internal politics, more objectivity, less hierarchical thinking. Instead, competent, constructive exchanges and a clear focus on performance. These are the values that my Executive Board, colleagues and I stand for and have agreed with our leadership teams. Another of these values is sustainability. We are aware that in the future, investors will increasingly steer clear of companies that cannot credibly demonstrate that they have clear goals and a clear plan to become climate-neutral. The nonprofit organization, CDP, which evaluates these very points and this year named us for the fourth year in a row as a global leader in climate protection, is backed by 525 investors, managing over USD 96 trillion in assets. That shows the changes that are taking place in this area and that we are on the right path with our climate goals. Ladies and gentlemen, when we meet again in a year, we will have steered the ship into calmer waters, and we will have picked up speed. We will have concluded the Elevator transaction and be working on further portfolio measures. We will be implementing or have already implemented our plans to improve performance in all our businesses and further results will be visible. And we will have further restructured our organization and made recognizable progress towards our goal of lean HQ strong businesses. But it will take 2 or 3 years for this restructuring to be reflected in the group's figures. In the short term, the forthcoming restructuring expenses will actually have a negative impact on earnings. That's why we have been cautious with our outlook for the current fiscal year. Ladies and gentlemen, I would like to close with a personal comment. Earlier, I thanked our 160,000 employees. They have been through a lot in the past few years. We have asked a great deal of them as we have of you as shareholders. And yet, you have kept faith with the company. For that, I would like to thank you. For you as shareholders and for our employees, it cannot be easy to constantly read negative headlines about the company, which many are so proud of. So I'm all the more impressed by the morale of the team. The people I meet in the company are open and sympathetic. Employees and managers, shareholders and works council members, of course, they are impatient. They want change. They want success. In short, all people I have worked with in the past few months, have my greatest respect. They have shown a side of themselves that motivates me every day to move thyssenkrupp forward. I would like to thank all these people for their support over the past few months. And I will work hard for all these people to ensure that their company, our company, thyssenkrupp, makes the headlines, not only because of crisis, but soon, once again, mainly because of proud engineering. And thank you for your attention.

Thank you very much, Ms. Merz. Now I will be very brief, and I will give you the report of the Supervisory Board. As to the changes on the composition of the Board, Guido Kerkhoff and Dr. Donatus Kaufmann for legal and compliance have left the Board. Dr. Kaufman have been with us since 2014. Again, also for Dr. Kaufmann, I would like to thank you very much. Now as we just said, Ms. Martina Merz left the Supervisory Board to be seconded as the CEO until -- the latest up until 30th September 2020. On the 1st of February, Mr. Johannes Dietsch, became a member of the Board, and he's responsible for finances. And for the 1st of October 2019, Mr. Klaus Keysberg, responsible for Materials Services and Steel Group, has been elected to be a member of the Board. So that means that the members of the Board are very close to the operations and, therefore, can lead the company in a more direct way. We're very much focused on that. Because of the situation of thyssenkrupp in the past year, the exchange and the exchange of information has been intensified. The Supervisory Board has met 8 times and the overall Board met 29 times. And the meetings of the Supervisory Board and the Board were used to discuss the framework of the new strategy of thyssenkrupp. As to the activities of the Supervisory Board, I should like to refer you to the extended version in the -- of the report. You will see that in our annual report. Ladies and gentlemen, let me now talk about the changes of persons in the Supervisory Board. For the 26th of January, 2019, Professor Hans-Peter Keitel left the Supervisory Board. And Amtsgericht Duisburg then voted me and Carsten Spohr left his office. And again, the Amtsgericht Duisburg, appointed Mrs. Gifford and Mr. Luge was named the Deputy Head for Ms. Merz. Professor Bernhard Pellens, Carola von Schmettow, Jens Tischendorf and Markus Grolms will leave the Supervisory Board in the course of this year. Mr. Pellens has been on the Board since 2005 and has been in charge of the auditing committee. And on top of that, in the past year, up until this year, he was in charge of -- by residing over the Board. And Mrs. von Schmettow and Mr. Tischendorf have been since -- members since 2015. They have used their wide expertise in the discussions we held. Mr. Grolms has decided to leave his mandate for the Supervisory Board ahead of this term. Mr. Grolms as the Deputy President of the Supervisory Board, you have always been working hard for the interest of the employees and you were focused on the future of thyssenkrupp. And in 2018, in difficult times, in your function as Deputy Director, you actually led the Supervisory Board and helped the entire Board, especially Mr. Pellens. IG Metall has informed thyssenkrupp to put in this candidacy as a Labor Director at thyssenkrupp and since thyssenkrupp is part of the Montaigne union, of course, we respect the fact that IG Metall has the right to propose a candidate. We, at the Supervisory Board and also at management level, we are very happy that Mr. Grolms will stay with the company in this way, and we wish him well for his future task. Yes, yes. Of course, we still need the Board approval but he will take on his job on the 1st of April 2020. In the Supervisory Board of thyssenkrupp AG, aktiengesellschaft, the District Court of Duisburg has appointed Mr. Jürgen Kerner as a successor of Mr. Grolms. He is the main treasurer of IG Metall Germany. Mr. Pellens, Mrs. von Schmettow, Mr. Tischendorf, Mr. Grolms, I would like to thank you for your committed work for thyssenkrupp in this position, at the Supervisory Board level. I'd like to thank you. This also includes the gentleman, [ governance board ], who cannot be here today. Your work for thyssenkrupp requires our respect. We are wishing you well for you personally and for your future work. Shareholders, we also need to vote on the composition of the Supervisory Board. The 8 members of the Supervisory Board will have to be reinstated today. Those people who have consent, Mrs. Gather and Lothar Steinebach, will put -- lay down their offers as members of the Supervisory Board at today's meeting. I mean 3 of you have already been elected as members as the Supervisory Board. And you are tabled again. Mr. Wolfgang Colberg from Munich, he's been with us since 2018 on the Board. Mrs. Hengster, she is a member of the Board of the KFW Banking Group and has been with the Board of -- Supervisory Board since 2015. And Mrs. Martina Merz since 2003, has been on the board. And since she is now on the Board and because of that, she cannot work at the Supervisory Board. And after being the CEO, she will return to the Supervisory Board. Therefore, we are today in a position to reelect her, but she will not execute her office up until September. And then we have those members on the Board. These are the ones that you know, and I would like now to present to you the new candidates. Birgit Beihrendt. She's industrial manager with more than 30 years of experience in the automotive industry and also been active as the Chairman of Ford Europe, responsible for joint ventures and alliances. And since 2013 has been member of the Executive Board for this company. Working in the HQ in the U.S.A., she was responsible for the operative procurement globally and included -- including quality management for suppliers. Ms. Angelika Gifford has been with us since -- has been Vice President of our European business, elected in -- since the 1st of January. She has also worked at Hewlett-Packard Enterprise responsible for software and digitization in Germany, Switzerland and Austria. After the spinoff at Micro Focus, she was also, from 2018, responsible for the software company. For 20 years, she was also -- she had a high function with Microsoft. Ms. Gifford has been a member of the Supervisory Board since last year. Dr. Bernhard Günther, since 2016, Financial -- Chairman of the company in Essen and he was responsible for the fusion with E.ON. Between 2013 and 2016, he is the Finance Executive and was responsible for the IPO. Mr. Günther will replace Dr. Pellens as Head of the Financial Committee. Ms. Friederike Helfer works at the Cevian Capital Limited. Since 2008, she's been with Cevian and focuses -- and as a member of the Pan-European investment team, focuses on industrial companies. Dr. Ingo Luge was -- had higher functions at E.ON and CEO of E.ON Germany. Dr. Luge has been a member of the Supervisory Board since November last year. Following this AGM, he will be appointed as taking -- representing from Merz. Dr. Luge is also here to be voted as a substitute member of a Supervisory Board member to take on the seat of any members who cannot hold their seat. And Siegfried Russwurm, I'm management company -- business management. I have also worked for Siemens. From 2008 to 2017, member of the overall Executive Board of Siemens AG. Currently, I'm also Chairman of the -- at the Voith GmbH & Co. KGaA. In April 2019, I was appointed to the Supervisory Board of thyssenkrupp. And because of -- from that position, I have been a member -- I was the Chairman -- or acting Chairman of the Supervisory Board. If I am voted -- elected today, I will then again, become Chairman of the Supervisory Board, depending upon the outcome of the votes today. When Ms. Merz returns to the Supervisory Board, she will then take -- again, take on the role as Chairwoman of the Supervisory Board. Ladies and gentlemen, we are convinced that the Supervisory Board of the company, with the proposed members and the new members, will be of a great team. In particular, we will cover a broad range of skills and expertise. To shareholders, ladies and gentlemen, before we move on to a number of formal aspects and then go to our general debate, I will now -- I would like to expressly thank all members of the Executive Board and Supervisory Board for their actions in the past year. I'd also like to thank you -- I'd also thank you, the shareholders of the company of the thyssenkrupp group company, for having stayed loyal to the company in these difficult times. Thank you. Ladies and gentlemen, today's agenda has 6 points. Point 1 is the presentation of the adopted financial statements for thyssenkrupp AG and the consolidated financial statements for the year ended September 30, 2019, the combined management report of thyssenkrupp AG and the group for the 2018-2019 fiscal year. The report of the Supervisory Board and the explanatory report by the Executive Board on the information pursuant to Article 289 of the German commercial code, the HGB. Point 2 on the agenda is the resolution on the disposition of the unappropriated net income; 3, is the resolution on the ratification of the Acts of the Members of the Executive Board; Point 4 is the resolution on the ratification of the Acts of the Members of the Supervisory Board; Point 5 is the resolution on the election of the auditors for the parent company and consolidated annual financial statements and the auditor's review of interim financial reports; and finally, Point 6 is the resolution on the election of the Supervisory Board members. The full details of the suggestions are available to you -- and have been available to you. The adopted financial statements and the consolidated financial statements, in accordance with the paragraphs 289 and 315A of the HCB, and the further documents have been available since the -- in the Internet since the invitation and the convening of the AGM in the foyer of the venue here. You also have access to all the information and various printed companies -- copies of the reports are also available in the foyer. I now have the list of attendees, at the present of the company's capital, 335 shares are present here, together with the votes, that is 53% of the capital. In addition 445, 849 and 715 shares, we also have postal votes that represents 23% of the registered capital. Overall, so 77.36% of the registered equity capital are represented here at the AGM. The list of participants is available in the foyer. Dear shareholders, we are now moving on to the debate of the points in the agenda. This is a general debate. You are entitled to express your comments and the questions on all points on the agenda. There are 6 agenda points today. And we already have many members who have expressed their wish to comment and question. We know that many people leave the AGM earlier on. It is in the interest of all.