Tata Steel reported a consolidated loss of Rs.5,674.29 crore for the fourth quarter of 2014-15 against a profit of Rs.1,035.87 crore posted in the year-ago period due to exceptional items of Rs.4,811 crore during the period.
The exceptional item is due to an impairment charge relating to Tata Steel Europe’s operations as also Tata Steel’s investments in raw material projects. These include projects in Mozambique and Ivory Coast and the Taconite project in Canada because the economic viability of these projects remains uncertain, according to the company.
Consolidated net sales declined 21 per cent to Rs.33,336.81 crore and operating profit was down to a third at Rs.1,580 crore (Rs.4,917 crore) while steel deliveries also declined 9 per cent to 7.06 million tonnes.
“An increase in costs and the impact of regulations on mining impacted the profitability of the Indian operations,” said Koushik Chatterjee, Group Executive Director (Finance & Corporate), Tata Steel. “Besides, Indian operations were impacted by surging imports, declining commodity prices and muted demand.”
Its stand alone India operations saw a 59 per cent decline in profit at Rs.814.09 crore, while net sales declined 16 per cent to Rs.10,522 crore.
“Indian Hot rolled coil (HRC) prices declined by Rs.3,000 per tonne in the Q4 due to a deluge of imports in the second half of the year,” said T.V. Narendran, MD, Tata Steel India and South East Asia.Tata Steel Europe reported an operating profit of Rs.280 crore (loss of Rs.16 crore) in the Q4. Turnover was flat at Rs.19,537 crore, while operating profit rose 29 per cent to Rs.1,053 crore.
For the year 2014-15, Tata Steel reported a 14 per cent drop in consolidated turnover at Rs.139,504 crore and a loss of Rs.3,926 crore. The impairment charge during the year was Rs.6,391 crore. Operating profit declined to Rs.12,745 crore. The Board recommended a dividend of Rs.8 per share.
