Tata Steel, the country’s oldest steel producer, reported a consolidated profit after tax (PAT) of Rs 9,598 crore in the December quarter, up 139 per cent from the corresponding period last year. It reported a PAT of Rs 4,011 crore in the year-ago period.
Consolidated EBITDA at Rs 15,853 crore was higher by 64 per cent on a year-on-year (YoY) basis. Taking advantage of strong cash flows, the company made debt repayment of Rs 17,376 crore in the first nine months of the financial year bringing gross debt down to Rs 72,603 crore and net debt to Rs 62,869 crore.
Consolidated turnover was at Rs 60,783 crore in the quarter compared to Rs 41,935 crore a year back. Sequentially, the turnover was near-flat while net profit dipped as steel prices moderated. Turnover in the previous quarter had stood at Rs 60,387 crore and PAT at Rs 12,548 crore.
Tata Steel said that consolidated revenues were broadly stable on a quarter-on-quarter (QoQ) basis as improvement in net realisations more than offset the drop in volumes.
Consolidated deliveries in Q3FY22 stood at 7.01 million tonnes compared to 7.41 million tonnes a year back and 7.39 million tonnes in the previous quarter.
Revenues from European operations increased by 7 per cent QoQ and 56 per cent year-on-year (YoY) to £2,246 million in 3QFY22; EBITDA was at £290 million which translates to an EBITDA per ton of £134.
T V Narendran, chief executive officer and managing director, said that European operations continued to perform underpinned by strong improvement in realizations.
On India, he said, steel demand has begun to improve on the back of continued economic recovery. “Our steel deliveries in India expanded by 4 per cent in the first nine months of the financial year along with an improvement in product mix,” he added.
Koushik Chatterjee, executive director and chief financial officer, Tata Steel, said that Tata Steel generated strong free cash flows of Rs 6,338 crores for the quarter which were used to reduce the debt.
Tata Steel Long Products, a subsidiary, was recently declared the winning bidder for acquisition of Neelachal Ispat Nigam.
The acquisition, Chatterjee said, would be financed by Tata Steel largely through a combination of internal accruals and bridge funding.
However, he also said that the company would remain focused on its enterprise strategy to deleverage its balance sheet while it pursues its growth priorities.
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