Hot Pursuit     30-May-24
Tata Steel slides after Q4 PAT tumbles 64% YoY to Rs 554 cr; declares dividend of Rs 3.60/ share
Tata Steel fell 2.21% to Rs 170.35 after the company’s consolidated net profit declined 64.59% to Rs 554.56 crore from Rs 1,566.24 crore posted in Q4 FY23.
Revenue from operations fell 6.79% YoY to Rs 58,687.31 crore in Q4 FY24.

Profit before tax stood at Rs 1,808.87 crore as compared with Rs 3320.77 crore, down 45.53% YoY.

Reported EBITDA stood at Rs 6,631 crore, declining 8.22% as compared with Rs 7,225 crore in the quarter ended 31 March 2023. EBITDA margin was approximately 11% during the quarter.

The company’s consolidated crude steel production increased by 1.45% to 7.92 million tons in Q4 FY24 as compared to 7.80 million tonnes in Q4 FY23 while Deliveries jumped 2.57% to 7.98 million tonnes in Q4 FY24 over Q4 FY23.

The company has spent Rs 4,850 crores on capital expenditure during the quarter.

In India, the company’s crude steel production was 5.40 million tones, up 4.85% YoY. Deliveries increased 5.24% to 5.42 million tonnes in Q4 FY24 as compared with 5.15 million tonnes in Q4 FY23.

Reported EBITDA stood at Rs 8,261 crore in Q4 FY24, registering de-growth of 2.64% as compared with Rs 8,485 crore posted in the corresponding quarter last year.

For the quarter, UK revenues were £647 million and EBITDA loss stood at £34 million while Netherlands revenues were £1,324 million and EBITDA loss was at £27 million.

On full year basis, the company reported consolidated net loss of Rs 4,099.61 crore in FY24 as compared with net profit to Rs 8,075.35 crore in FY23. Revenue from operations declined 5.83% YoY to Rs 229,170.78 crore in FY24.

Meanwhile, the company’s board has declared a dividend of Rs 3.60 per equity share for FY24.

T V Narendran, chief executive officer & managing director, said, “Our domestic deliveries were best ever at around 19 million tons and were up 9% YoY with broad based improvement across chosen market segments. Automotive volumes were aided by higher deliveries of hot-rolled and cold-rolled steel to auto OEMs while our well-established retail brand Tata Tiscon crossed 2 million tons on an annual basis.

We are committed to creating a low-CO2 steel business that preserves the majority of the jobs in UK while also creating economic opportunities. In Netherlands, our production was lower due to the relining of BF6.

Koushik Chatterjee, executive director and chief financial officer, said, “Consolidated cash flow from operations was around Rs 7,400 crores for the quarter and Rs 20,300 crores for the full year. Our capital expenditure was Rs 4,850 crores for the quarter and Rs 18,207 crores for the full year, up 29% YoY. Our Group liquidity remains strong at Rs 31,767 crore.

Moving to strategic initiatives, we have been carefully considering the alternative proposal from the representative body of the UK trade unions and have concluded that maintaining one blast furnace till the transition would have incurred at least £1.6 billion of additional costs, created significant operational and safety risk, and delayed the EAF by two years.

We will proceed with our proposal to shut down heavy end assets this year, and setup the EAF by 2027. This is a difficult period of change for our people and we will do our upmost to support the affected employees. With respect to the Electric Arc Furnace, we will place equipment orders by Sep 2024 and have signed the agreement with the UK National Grid securing the high voltage connection, which will be available on schedule. We have as part of discussions with the unions, offered the best ever package of support for affected employees in Tata Steel UK. We have also agreed the final and detailed terms of the proposed grant package with the UK government to support the £1.25 billion investment.”

Tata Steel Group is among the top global steel companies with an annual crude steel capacity of 35 million tons per annum.

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