Sajjan Jindal-led JSW Steel reported that its June quarter net profit was down 64 per cent at ₹867 crore against ₹2,428 crore logged in same period last year, on back of lower realisation.
Income was up one per cent at ₹43,107 crore (₹42,544 crore).
Expenses increased to ₹41,715 crore (₹39,030 crore).
The company has signed an agreement with group company JSW Infrastructure to transfer 30 MTPA slurry pipeline project for ₹1,700 crore.
Once the project is completed and transferred, the steel company will enter into a 20-year take-or-pay agreement with JSW Infrastructure to transport iron ore slurry from Nuagaon mines to Jagatsinghpur through the pipeline.
JSW Steel will pay ₹1,324 crore per annum to JSW Infrastructure for transporting 18 MTPA of iron ore, an amount that will be escalated annually.
The deal is expected to be completed in six months.
It said the transaction allows JSW Steel to preserve capital for future growth and allows management to focus on the core steel business.
- Also read: JSW Steel to invest $100 mn in US facility
JSW Steel sales were up 7 per cent at 6.12 million tonnes. EBITDA was down at ₹5,510 crore (₹7,046 crore). Net sales realisations in India were down 5 per cent y-on-y on lower domestic steel prices.
While domestic operations benefited from lower coking coal and iron ore prices, it was more than offset by inventory losses and planned shutdown, said the company.
The company’s domestic net profit was down 48 per cent to ₹1,156 crore (₹2,236 crore), and revenue was up 5 per cent to ₹40,537 crore (₹38,745 crore). EBITDA dipped 16 per cent to ₹5,417 crore (₹6,461 crore).
Net Debt of the company increased to ₹80,199 crore against ₹73,916 crore as of March-end.
The company’s plant in Ohio, US reported an EBITDA loss of $16 million for the quarter due to sharp decline in steel prices and
loss in net realisation value while the pipe and plate mill registered an EBITDA of $13 million. Italy’s operations also recorded a lower EBITDA of 7.67 million euros for the quarter.