ThyssenKrupp, the industrial group rumoured to be mulling a bid for Corus, has revealed that profits more than doubled in the last three months of 2004, boosted by a strong steel market.

The Dusseldorf-based company, the world's biggest manufacturer of stainless steel, said that pre-tax profits grew to "well in excess" of €400 million compared with €168 in the same quarter a year before. Analysts had forecast a €361 million profits figure.

Sales rose by 20 per cent to €10.1 billion with orders rising by 16 per cent to €10.8 billion, signalling a strong performance for the rest of 2005. The company also raised its forecast for full-year profits.

The data was welcome by analysts, with Heino Ruland, the head of sales and research at Steubing, saying: “Both earnings and sales are considerably better than the market expected. The light should now change to green for the stock.”

ThyssenKrupp shares rose by 1.3 per cent to €16.83 in Frankfurt trade.

ThyssenKrupp, which also makes car parts, lifts and fuel-cell powered submarines, credited its improved performance to the strength of the steel market, which has been underpinned by strong Chinese demand. The company has, like other steelmakers, introduced a series of price rises, with the latest, of €30 per tonne, introduced at the start of this month.

The data follows the release last week by Posco, the South Korean steelmaker, of a near doubling in profits for 2004. The company's production rose by only 4.5 per cent.

"Favourable market conditions and a profitable product mix resulted in the record performance," Posco said, revealing plans for 16 trillion won (£8.7 billion) investment to become the world's third ranking steelmaker by 2008.

Corus is expected in March to announce its first annual profit since the company was formed from a merger of British Steel and Hoogovens, its Dutch peer, in 1999.

Corus shares soared last year, helped by the strong steel market and speculation of a bid by ThyssenKrupp, which in October confirmed it was seeking merger partners and identified Corus as a potential target.

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