By Christoph Steitz and Tom Käckenhoff

ESSEN (Germany) -Thyssenkrupp said Thursday that its operating profit could exceed double in the next year due to an economic recovery. This will be aided by a turnaround and expected listings for its steel and hydrogen divisions.

The conglomerate supplies the automotive sector and expects adjusted earnings before tax to be between 1.5 billion and 1.8 billion euros ($1.7 billion-$2.0 billion).

After two years of intense transformation, the turnaround has become evident. Martina Merz, Chief Executive Officer at Thyssenkrupp said that the company is moving in the right direction.

However, there are still enormous challenges, especially because of the shortage in semiconductors and uncertainties that arise from the coronavirus epidemic.

After years of losses, the company that was forced to sell its elevator division in order to avoid collapse has announced it prefers to offer its hydrogen unit Uhde Chlorine Engineers to investors.

Thyssenkrupp said it would retain a majority interest in an IPO.

Prior options to the UCE included either a partnership with an investor or a deal with SPAC (special purpose acquisition company).

UCE (66-34 joint venture Thyssenkrupp with Italy’s De Nora) is the biggest supplier of chloralkali membrane technology used for hydrogen production. UCE is valued at between 3 billion and 6 billion euros by analysts.

Thyssenkrupp has been studying the circumstances that would be required to spin off its steel division (Europe’s 2nd-largest), a move previously criticized but dependent upon government subsidies in order shift towards carbon-neutral production.

($1 = 0.8838 euros)