Troubled German steelmaker Thyssenkrupp has reported a €1bn ($1.06bn) loss at its steel division as demand weakens, with the industrial giant citing a bleak outlook for sales volumes and structural challenges in the sector.

The company’s net loss narrowed to €1.5bn in the fiscal year ended Sept. 30, after deducting minority stakes, from a net loss of €2bn a year earlier. It said the loss in the past fiscal year was mainly due to an impairment of €1.2bn, of which €1bn was borne by its European steel unit.

“As far as our key strategic issues are concerned, this will be a year of decisive decisions, and we will seek to further improve the performance of all our businesses and take full advantage of the opportunities offered by the green transition,” Chief Executive Miguel Lopez said.

Thyssenkrupp, which makes submarines and car parts in addition to its steel production, is currently in the process of restructuring its European steel unit into a standalone company. Over the summer, the company completed the sale of a 20% stake in the unit to EB Corporate Group, the investment vehicle of Czech billionaire Daniel Krinitske. The German company is also looking to divest its Marine Systems business and is still negotiating with the German government about a possible partnership. “When it comes to recovery, Germany continues to lag behind its European neighbors,” Thyssenkrupp said in its annual statement. “As an exporter, the country continues to suffer from weak global demand for industrial goods. Moreover, sluggish domestic demand underscores the current investment crunch and weak consumer spending.”