Home >Companies >Company Results >Tata Steel reports highest-ever net profit in June qtr

Tata Steel on Thursday reported its highest-ever consolidated net profit of 9,768 crore for the quarter ended 30 June, compared with a net loss of 4,648 crore in the year-ago quarter.

India’s largest steelmaker reported 109.5% year-on-year growth in consolidated revenue to 53,371.8 crore during the first quarter. A Bloomberg consensus estimate of 11 brokers said profit would come in at 9,042.20 crore and a consensus of 12 brokers estimated 5,2497.40 crore in revenues.

“Our consolidated financial performance for the quarter was exceptionally strong on the back of strong underlying business performance and buoyant market conditions," said Koushik Chatterjee, chief financial officer, Tata Steel.

While the India business posted an operating profit of 13,946 crore, the European business had an improved quarter, and the impact of rising spreads are expe-cted to positively benefit in the coming quarters, he said.

“Despite the increase in working capital due to higher prices of both steel and raw materials, the company generated consolidated free cash flow of over 3,500 crore during the quarter and made debt repayments of 5,894 crore. We are committed to deleverage further and expect to bring down the debt significantly by the end of the current financial year," said Chatterjee.

In India, Tata Steel’s operating profit per tonne soared 576% year-on-year to 33,604, while it rose 28% on a sequential basis. The company spent 2,011 crore on capital expenditure during the quarter, and work on the pellet plant, cold roll mill complex and 5 million tonne per annum expansion at Kalinganagar was on track.

The company saw its gross debt fall to 84,237 crore in the June quarter, while net debt decreased to 73,973 crore.

“Demand has begun recovering in India, though domestic steel prices continue to be at a steep discount to China’s import parity prices. We continue to focus on our objective to attain and retain market leadership in chosen segments by building strong customer relationships, superior distribution network, rolling out brands, and developing new products and solutions in steel and new materials," said T.V. Narendran, chief executive officer and managing director, Tata Steel. Tata Steel shares ended 0.6% higher at 1,435 on the BSE on Thursday.

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