Tata Steel has reported ₹522 crore against net loss of ₹2,502 crore in the same period last year on the back of lower costs.
Income was lower by 3 per cent at ₹55,540 crore (₹57,354 crore). Total expenses were down 7 per cent at ₹53,351 crore (₹57,172 crore) due to softer input cost.
The company has taken a provision of ₹313 core (₹2 crore) for restructuring plan to reduce employment costs through reduction in head-count in the Group’s Netherland Operations.
Steel production was marginally up at 7.58 million tonne (7.56 mt), while sales remained flat at 7.15 mt. EBITDA increased to ₹5,742 crore (₹2,727 crore) and EBITDA per tonne was lower at ₹8,035 (₹3,812).
The company has spent ₹4,715 crore on capex in the quarter and the phased commissioning of the 5-MTPA expansion at Kalinganagar has commenced. Net debt stands was at ₹77,405 crore. The group liquidity remains strong at ₹23,349 crore.
The company’s UK revenues were at £603 million with EBITDA loss of £159 million in the December quarter. Netherlands revenues were at £1,239 million with EBITDA loss of £117 million.
UK operations
Tata Steel has started the statutory consultation on the proposed restructuring of the UK business as part of its transition to an economically and environmentally sustainable future.
The transition at UK operations is subject to consultation, but could be expected to result in up to 2,500 job losses in the next 18 months and another 300 roles in three years.
TV Narendran, Managing Director, Tata Steel said amid challenging environment, China has exported between 7 and 8 mt of steel every month, which is the highest since 2015 and this has adversely impacted global steel prices and profitability.
The consistent sales growth in India has been aided by crude steel production being close to 5 mt across the quarters in this financial year.
The company’s analysis in Europe shows that partial continuity of blast furnaces until completion of transition to the EAF is not affordable and engineering studies have found that building the EAF in an already operating steel melt shop is not feasible. Tata Steel expects to commission the EAF by 2027.
On a standalone basis, net profit nearly doubled to ₹4,653 crore (₹2,363 crore) on 1 per cent increase in income at ₹35,010 crore (₹34,653 crore). Expenses dipped 8 per cent to ₹28,997 crore (₹31,413 crore).