By Victoria Waldersee and Tom Käckenhoff

BERLIN (Reuters) – Thyssenkrupp’s radical restructuring involving a string of disposals and cost cuts is about halfway complete, with the group on track for higher sales and margins in coming years, its leadership team said on Thursday on its Capital Markets Day.

The sprawling conglomerate began stripping off division after division in 2020, including a sale of its profitable elevator business for 17.2 billion euros ($19.50 billion), in an attempt to bring down roughly the same sum’s worth of debt and crippling pension liabilities.

The German steel-to-submarines conglomerate expects mid-term adjusted margins of 4-6% and aims to restore its ability to consistently pay a dividend, it said in a statement ahead of presentations. The group had reported an adjusted margin of 2.3% in the full year 2020/21.

“We are relentlessly pushing forward the full transformation to the group,” CEO Martina Merz said on Thursday, adding the sale of the elevator division was a difficult but necessary step. “The focus now is preparing the next package of divestments.”

Thyssenkrupp’s two-year overhaul has so far included the sale of its mining technology business to Denmark’s FLSmidth in July and the disposal of its infrastructure and carbon components operation.

These transactions should bring in a high-triple-digit-million euro figure to bolster the company’s net financial position and pension liabilities, Thyssenkrupp said.

Next in line are the marine systems division, which could see partnerships, consolidation or a standalone scenario, and the cement plant construction and chemicals divisions, whose future the company will be deciding on soon.

More details about the initial public offering of its hydrogen division Uhde Chlorine Engineers planned early next year will be announced at a capital markets day on Jan. 13.

Higher material prices and expanding margins in both materials and steel should fuel higher sales and earnings in the first quarter of next year, Chief Financial Officer Klaus Keysberg said.

The group reported sales of 7.3 billion euros and EBIT of 78 million euros in the first quarter of 2020/21.

Adjusted medium-term EBIT margin targets by division included at least 10% for industrial components and 7-8% for automotive, where 80% of sales were being generated from components not used in combustion engines.

($1 = 0.8822 euros)

(Reporting by Victoria Waldersee, Tom Kaeckenhoff, Editing by Zuzanna Szymanska and Bernadette Baum)