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Home arrow News arrow Business News arrow Tata Steel reports record deliveries and profits from Indian operations
Tata Steel reports record deliveries and profits from Indian operations Print E-mail
Written by Viswanath   
Thursday, 26 May 2011
Mumbai: Tata Steel has reported record deliveries and profits from it's Indian operations and a significant turnaround in financial and operating performance in Europe. Tata Steel Group recorded profit after tax of Rs 8,983 crores (US$2,015 million) in FY’11, an improvement of Rs 10,992 crores (US$2,466 million) over the loss of Rs 2,009 crores (US$451 million) in FY’10.

"The Indian operations registered a 36% increase in annual profits because of favourable market conditions and the untiring efforts of employees to exceed targets," said Tata Steel Managing Director HM Nerurkar.

The Indian operations' profit after tax of Rs. 6,866 crores (US$1,540 million) and EBITDA of Rs. 12,225 crores (US$2,742 million) were the highest ever on the back of higher volumes, improved product-mix and higher realisations.

The 2.9 million tpa brownfield expansion in Jamshedpur is progressing on schedule. The Company has also begun site work on its greenfield project in Odisha.

"We enjoy an excellent position in India compared to our global peers to counter cost pressures, given the growing domestic market, a higher proportion of value-added products and a sizeable increase in capacity by the end of the financial year. The Odisha project is gaining momentum and its first phase is expected to be commissioned by the end of 2014. The South East Asian operations focused on tackling a challenging business environment and are now better placed to take advantage of improving market conditions," he said.

"Our encouraging fourth-quarter performance consolidated the turnaround in the European operations achieved during the year. Higher selling prices and deliveries gave us a particularly strong end to the quarter, with additional one-off financial benefits from items such as the completion of the Teesside Cast Products sale. Our strategy, founded on four building blocks of market differentiation, technical innovation, cost leadership and operational excellence, is starting to deliver early successes as we focus on customer relationships. The measures announced last week in Long Products show our determination to complete the turnaround task and create a very competitive business that delivers robust performance in all market conditions," said Tata Steel Europe MD & CEO Dr Karl-Ulrich Köhler.

The European operations recorded robust improvement, posting an EBITDA of Rs. 4,204 crores (US$943 million), an increase of Rs. 5,555 crores (US$1,246 million) over FY’10. Higher sales and realisations along with cost-cutting measures, initiated in the aftermath of the financial crisis, lay behind this performance. However, the Long Products business continues to face significant challenges and the Company accordingly announced restructuring initiatives earlier this month.

The sale of Teesside Cast Products (a slab manufacturing facility mothballed in February 2010) was completed in March 2011 in a deal valuing the business at Rs. 2,091 crores (US$469 million).

Net debt at the end of March 2011 at Rs. 46,632 crores (US$10.46 billion) fell from Rs. 52,836 crores (US$11.85 billion) at the end of the previous quarter.

Tata Steel Group recorded EBITDA of Rs. 17,103 crores (US$3,836 million) for the full year, 83% higher than the EBITDA of Rs. 9,340 crores (US$2,095 million) in FY’10.

 
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