Tata Steel on Monday reported consolidated net loss of Rs 3,183 crore for the quarter ended June 30 because of its erstwhile entity long Steel UK.
The steel major’s operating profit or EBITDA (earnings before interest, tax, depreciation and amortisation) at 21 per cent was higher than the year-ago period due to improved operating performance in India, Europe and South East Asia.
It posted net loss after taxes, minority interest and share of profit of associates of Rs 3,183 crore for the April- June quarter of the current financial year, as against net loss of Rs 316.91 crore in the year-ago period.
Tata Steel’s Europe division was sold at a loss of Rs 3,296.48 crore to Greybull Capital llP. This loss was recognised in the first quarter.
The Tata Steel Group posted net profit of Rs 172 crore in the quarter under review from continuing business for the first time after several quarters, the company said.
Its total income fell by 6 per cent to Rs 26,406.10 crore during the quarter under review, as against Rs 28,025.43 crore in the year-ago period.
“Seasonal headwinds and a slowdown in a large steel consuming sector like real estate affected steel demand in the quarter. While the regulatory changes have helped stem the flood of imports, domestic supply has increased and added to the competitive pressure.
“The company’s deliveries were stable this quarter and we successfully maintained our market share in our chosen high- end segments,” said Tata Steel India and South East Asia Managing Director T V Narendran.
“Our auto business grew by 19 per cent over the last year and branded products now contribute around 34 per cent of overall sales. Stronger realisations and focus on value added products helped the business expand margins by 310 basis points and deliver an EBITDA of Rs 2,236 crore,” he said.
Despite continued imports from China, the South East Asia operations have shown a significant improvement in the business due to focus on downstream products and solutions, exports and effective management of spreads, Narendran said.
Operations in India, Europe and South East Asia made positive contributions. EBITDA of Rs 3,270 crore, 65 per cent higher than the fourth quarter of 2015-16. It was 21 per cent higher than the first quarter of 2015-16 due to improved operating performance regions.