India-headquartered steel giant
Tata Steel Group announced on May 26 that its loss after tax in FY 2009-10 ended on March 31 amounted to $447 million, compared to a profit after tax of $1.1 billion in the previous fiscal year, while its EBITDA halved as compared to FY 2008-09, totaling $2.08 billion, due to the lower capacity utilization in the first half, primarily at
Tata Steel Europe, and lower average selling prices compared with the all-time high price levels before the onset of the financial crisis in September 2008.
In the period in question,
Tata Steel Group's steel deliveries came to 24.3 million metric tons, regressing by 14.74 percent year on year.
Meanwhile, in the last quarter of FY 2009-10, the group's profit after tax was five times higher as compared to the previous quarter and amounted to $542 million, on account of greater volumes and higher prices at
Tata Steel India and the much-improved operating performance at
Tata Steel Europe, also up from a loss after tax of $1.01 billion in the corresponding quarter of FY 2008-09. In the given quarter,
Tata Steel Group's EBITDA was $1.19 billion, increasing by 56.8 percent quarter on quarter and up from -$62 million in Q4 FY 2008-09.
Turnover at
Tata Steel Europe (Corus) in Q4 FY 2009-10 of $3.81 billion increased by two percent compared to the third quarter on account of a four percent increase in deliveries and higher average selling prices. Turnover dropped by four percent compared to the last quarter of FY 2008-09 due to a 15 percent drop in average selling prices offset by an 11 percent increase in deliveries. EBITDA of $366 million recorded in the last quarter of FY 2009-10 was a substantial turnaround from the EBITDA loss of $318 million recorded in Q4 FY 2008-09 and an increase of 149 percent compared with EBITDA of $147 million in the third quarter of FY 2009-10.
Commenting on the results,
Tata Steel Europe's CEO Kirby Adams said, "I am pleased to report that the decisive measures we have been taking to combat the 35 percent slump in European steel demand last year have succeeded in dramatically improving the company's financial and safety performance. The employees of
Tata Steel Europe deserve great credit for achieving growth in market share, a higher value-added mix, significant and lasting cost reductions, and in Q4 the first profit after tax in 1.5 years."
On the other hand
Tata Steel's managing director Hemant Nerurkar said, "The contribution of the Asian operations to the group's crude steel production rose to 37 percent last year, compared to 30 percent the previous year. The strong and stable growth trajectory for the Indian economy is forecast to continue, which bodes well for Indian steel demand, though there are inflationary pressures arising on the supply side. It would be helpful to have access to new domestic raw materials sources in order to combat this danger. Meanwhile we are accelerating our efforts to increase self-sufficiency through projects overseas."