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Informist, Monday, Jan. 27, 2025

 

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-- Tata Steel Oct-Dec consol net profit INR 3.27 bln
-- Seven analysts saw Tata Steel Oct-Dec consol net loss INR 7.03 bln
-- Tata Steel Oct-Dec consol net profit INR 3.27 bln vs INR 5.13 bln year ago
-- Tata Steel Oct-Dec consol revenue INR 536.48 bln vs INR 553.12 bln yr ago
-- Tata Steel: One-time cost of INR 1.26 bln in Oct-Dec
-- Tata Steel Apr-Dec consol PAT INR 21.20 bln vs INR 50.49 bln loss yr ago
-- Tata Steel Apr-Dec consol revenue INR 1.623 tln vs INR 1.705 tln year ago
-- Tata Steel Oct-Dec consol reported EBITDA INR 59.94 bln vs INR 63.34 bln
-- Tata Steel Oct-Dec consol adjusted EBITDA INR 71.55 bln vs INR 57.42 bln
-- Tata Steel Oct-Dec India adjusted EBITDA INR 78.20 bln vs INR 83.37 bln
-- Tata Steel Oct-Dec India adjusted EBITDA per tn INR 14,774 vs INR 17,087
-- Tata Steel Oct-Dec consol adjusted EBITDA per tn INR 9,263 vs INR 8,035
-- Tata Steel Oct-Dec capex INR 38.68 bln; Apr-Dec capex at INR 124.50 bln
-- Tata Steel net debt at INR 858 bln on Dec 31
 

 

By Rajesh Gajra

 

NEW DELHI – Tata Steel Ltd., flagship metals company of the Tata Group, beat Street estimates on its consolidated revenue for the December quarter. The company's consolidated bottom line was in the black, against the forecast of a net loss by seven brokerages.

 

Tata Steel reported a consolidated net profit of INR 3.27 billion for the December quarter, down 36% on year from INR 5.13 billion, within range of the net profit estimates by three brokerages. The average of estimates by the seven other brokerages was a net loss of INR 7.03 billion.

 

The company's consolidated revenue from operations declined 3% to INR 536.48 billion, from INR 553.12 billion in the year-ago quarter. It was the 10th consecutive quarter of year-on-year decline in revenue from operations for Tata Steel. However, the revenue from operations was higher than the Street estimate of INR 526.7 billion.

 

The revenue declined in the December quarter despite the consolidated deliveries volume, or sales volume, increasing 8% on year to 7.72 million tonnes. This was aided by an increase of 8.4% in domestic sales volume to 5.29 million tonnes.

 

The company's operating profit performance was mixed. Tata Steel said profitability improved at its Netherlands operations.

 

The company's consolidated reported earnings before interest, tax, depreciation, and amortisation was down 5.4% on year to INR 59.94 billion in the December quarter, while the consolidated EBITDA, adjusted for changes on account of foreign currency movement on inter-company debt and receivables, rose 24.6% on year to INR 71.55 billion. The consolidated adjusted EBITDA per tonne increased to INR 9,263 from INR 8,035.

 

The operating profit performance in India operations was, however, weak. The India adjusted EBITDA declined 6.2% on year to INR 78.20 billion, and the adjusted EBITDA per tonne declined to INR 14,774 from INR 17,087.

 

In the company's Netherlands operations, the sales volume increased to 1.53 million tonnes in the December quarter from 1.30 million tonnes in the year-ago quarter, while the revenue increased by 7.3% on year to INR 138.67 billion. The drop in steel realisations offset the improvement in volumes, the company said. The operating loss in Netherlands narrowed to INR 10 million from INR 12.15 billion.

 

In the UK, Tata Steel's sales volume fell to 0.57 million tonne from 0.64 million tonne, and the revenue fell 10% on year to INR 56.65 billion. The operating loss narrowed to INR 7.35 billion in the December quarter from INR 16.57 billion a year ago.

 

The company said in a post-earnings investor presentation that increased exports by China and a slowdown in key regions weighed on spreads. In India, the "apparent steel demand continued to grow, but the momentum eased... (and) India continued to be a net steel importer", the company said. In Europe, the company said the steel-consuming sectors "have been adversely impacted by subdued demand dynamics and steady imports".

 

Tata Steel incurred capital expenditure of INR 38.68 billion for the December quarter. The company's gross debt declined marginally to INR 989.19 billion at the end of December from INR 993.92 billion as of Sept. 30. With a balance of INR 131.19 billion as of Dec. 31 in cash, bank, and current investments, the company's current net debt was INR 858 billion.

 

In the nine months to December of the financial year 2024-25 (Apr-Mar), Tata Steel's consolidated revenue declined by 4.8% on year to INR 1.623 trillion. In this period, the company reported a consolidated net profit of INR 21.20 billion against a net loss of INR 50.49 billion in the year-ago period.

 

On Monday, shares of Tata Steel ended 2.6% lower at INR 126.37 on the NSE.  End

 

Edited by Rajeev Pai

 

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