Agencies
New Delhi, Jan 24: Tata Steel on Wednesday posted a consolidated net profit of Rs 522.14 crore in the December quarter as strong domestic demand offset weakness in Europe.
The company had posted a net loss of Rs 2,501.95 crore in the year-ago period, the company said in a regulatory filing.
The company's consolidated income dropped to Rs 55,539.77 crore from Rs 57,354.16 crore in the year-ago quarter, it said. Tata Steel had reported a consolidated net loss of Rs 6,511.16 crore in the September quarter. "The global operating environment has been complex, with economic slowdown in China and geopolitics weighing on commodity prices in general," Tata Steel Chief Executive Officer and Managing Director T V Narendran said. "During the quarter, China has exported 7-8 million tonnes of steel every month -- the highest since 2015, and this has adversely impacted global steel prices as well as profitability.
"Despite this context, Tata Steel India has delivered better margins aided by higher deliveries as well as realisations on a quarter-on-quarter basis," Narendran said. The phased commissioning of the company's 5 Million Tonnes Per Annum (MTPA) capacity expansion at Kalinganagar plant is underway, he said.
"Moving to Europe, our deliveries in the Netherlands were up, while the UK moved lower quarter-on-quarter due to subdued demand as well as operational issues, given the ageing assets. We will commence statutory consultations with the unions in the UK as a step towards our transition to an EAF-based sustainable business," he said.
The company said its net debt stood at Rs 77,405 crore.
The group's liquidity remains strong at Rs 23,349 crore, including cash and cash equivalents of Rs 10,825 crore, it said.
According to Tata Steel's Executive Director and Chief Financial Officer Koushik Chatterjee, the company's UK business continues to face production shortfalls arising from the end-of-life condition of several heavy-end assets.
On Tata Steel's recent announcement to close its two blast furnaces in Britain by the end of the year, Chatterjee said the company's analysis shows that partial continuity of blast furnaces until completion of transition to the electric arc furnace is not affordable and engineering studies have found that building the EAF in an already operating steel melt shop is not feasible.
Tata Steel, he said, is aware of the impact of its proposal to wind down the heavy end in Port Talbot on individuals and the local community associated with its steel works, the company will meaningfully consult its employees and work to provide them with a fair, dignified and considerate outcome.
Tata Steel group is among the top global steel companies with an annual crude steel capacity of 35 MTPA. It is a geographically diversified steel producers, with operations and commercial presence across the world. |
