India-headquartered steel giant Tata Steel Group has issued its group financial results including Tata Steel Europe for the first quarter ended June 30 of the financial year 2015-16.
In the given quarter, Tata Steel Group registered a net profit of INR 7.63 billion ($117.76 million), up 126.4 percent, while the company's sales revenue decreased by 16.8 percent to INR 303 billion ($4.7 billion), both year on year. Steel deliveries in the June quarter amounted to 6.33 million mt, falling 10.34 percent compared to the corresponding quarter of the previous financial year.
"The Indian steel industry continues to bear the brunt of a surge in imports and tepid domestic demand which led to a sharp drop in steel prices over the quarter. Despite these macro headwinds, we were able to increase our deliveries by two percent over the last year. The South East Asian operations were impacted by a sharp drop in price spreads. However, the business focused on downstream processing and better raw material sourcing, which helped in improving the underlying performance,” said T V Narendran, managing director of Tata Steel India and South East Asia.
“European steel demand is increasing modestly. But imports have grown much faster in recent years and risk undermining Europe’s steel industry. Imports from China, in particular, have grown at an alarming rate, hot rolled coil shipments from China have been arriving at more than three times the volumes of 2013, adversely affecting international steel prices. Surging imports constitute a threat to European steelmaking. Uncompetitive energy costs and the strength of sterling are hurting our UK operations. These three factors caused our first quarter financial performance to deteriorate, despite our more stable production platform as seen in our improved operating performance,” commented Dr Karl-Ulrich Köhler, managing director and CEO of Tata Steel Europe.