Tata Steel, on Wednesday, reported a drop of 70 per cent in its consolidated net profit for the quarter ended June 2014 at Rs.337 crore. The company said it was affected by exceptional charges of Rs.262 crore during the quarter and an exceptional gain of Rs.17.76 crore in the year-ago period. Consolidated turnover was up 11 per cent at Rs.36,427 crore. Operating profit was higher at Rs.4,325 crore against Rs.3,755 crore. Total steel deliveries rose to 6.46 million tonnes (6.08 million tonnes).
The company’s Indian operations reported an improved performance with a net profit of Rs.2,268 crore (Rs.1,356 crore) but this included exceptional gains of Rs.788 crore from the stake sale in The Dhamra Port Company. Turnover rose 11 per cent to Rs.10,468 crore while operating profit was up 13 per cent at Rs.3,266 crore and the operating margin was up 56 basis points.
In a statement, T. V. Narendran, Managing Director, Tata Steel, India and Southeast Asia, said “We continue to grow our delivery volumes with enrichment of the overall product mix. During the quarter, we have started commercial operations of our continuous annealing line and a new galvanising line. In addition, the coke oven battery 11 has been commissioned and the facility was ramped up in record time.”
Tata Steel Europe reported better profit (earnings before interest and tax) of Rs.136 crore (Rs.12 crore) on 11 per cent higher turnover of Rs.20,741 crore. Operating profit rose 28 per cent to Rs.995 crore while the operating margin rose 58 basis points. Liquid steel production was unchanged at 3.7 million tonnes.
“European steel demand is moving in the right direction,” Karl-Ulrich Kohler, Managing Director & CEO, Tata Steel Europe, said in a statement. “Though demand remains well below levels we would regard as healthy, we can see greater stability emerging in the markets we serve. Our quarterly financial performance improved slightly, despite market spreads tightening compared to the previous year.”
On the Bombay Stock Exchange on Wednesday, Tata Steel stock reacted by 1.33 per cent to close trading at Rs.534.7.
