Highlights for the third quarter:

• Group consolidated turnover rose to Rs. 33,223 crores (US$ 6.84 billion), up 4% from the third quarter of 2007-08 (Q3 FY’08).
• EBITDA at Rs. 2,971 crores (US$ 0.61 billion), was lower by 27% from Q3 FY’08.
• Earnings before exceptional items and tax fell to Rs. 892 crores (US$ 0.18 billion), down 55% from Q3 FY’08.
• Total steel deliveries for the quarter dropped 25% to 6.0 million tonnes from 8.0 million tonnes in Q3 FY’08.
• Tata Steel became the first integrated steel company in the world, outside Japan, to be awarded the coveted Deming Application Prize for excellence in Total Quality Management.

Financial results summary (under Indian GAAP) for the third quarter and nine months ended December 2008.

Rs. Crores

                   For the purposes of this note the Indian rupee has been converted to US$ at Rs.48.58 per US$.

Notes

Effective April 1 2008, actuarial gains or losses in pension funds of Corus (Tata Steel Europe) are being recognised in retained earnings in accordance with TS Europe practice, instead of the earlier practice (followed up to March 31 2008) of recognising the gains or losses in the profit and loss account. For the purposes of comparison, results of the previous year have been recast to accord with current practice.

Reflecting the current market conditions, the amount by which inventories were written down during the period April to December 2009 was Rs.2,188 crores (US$ 450 mn) {Rs.1,744 crores (US 359 mn) during Q3 FY09}.

Executive comment

Tata Steel Managing Director Mr B. Muthuraman said: “During the quarter Tata Steel showed its resilience in the face of the gathering economic storm.  The fallout from the banking crisis began to affect steel prices and volumes and it became impossible to be a major steel industry player without feeling the impact of what is a global crisis.  But it is Tata Steel’s global status that will prove to be its long-term strength.  Achievements like the award of the Deming Prize highlight Tata Steel’s position in the top flight of world steelmakers.”

Corus Chief Executive Mr Philippe Varin said: “Corus reacted quickly and decisively to the onset of the financial downturn.  As a result of a process that began during the quarter, the company has identified a total of £600 million in cash benefits in the six months to the end of March alone.  In recent weeks the company has taken further action to address long-term structural issues and ensure it is in the best possible position when demand and markets recover. Throughout this period we will be doing all we can to soften the impact of the downturn on our employees and help those directly affected.”

Tata Steel

Compared to the same prior-year periods turnover at Tata Steel India increased by 27% to Rs. 18,077 crores (US$ 3.72 billion) in April to December 2008 and fell by 4% to Rs. 4,811 crores (US$ 990 million) in the third quarter. EBITDA increased by 35% to Rs 7,945 crores (US$ 1.64 billion) in April to December and fell by 28% to Rs 1,486 crores (US$ 306 million) in the third quarter. 

Finished steel production at Tata Steel India for the nine months of the current fiscal year at 3.75 million tonnes was 4% higher than the corresponding period of the previous year and during the third quarter at 1.23 million tonnes was almost unchanged from the 1.25 million tonnes of Q3 FY’08. Steel deliveries fell by by 1% to 3.45 million tonnes in April-December and by 14% to 1.07 million tonnes in the third quarter.

Corus (Tata Steel Europe)

Compared to the same prior-year periods turnover at Corus increased by 25% to Rs. 91,862 crores (US$ 18.91 billion) in April to December and by 10% to Rs 26,139 crores (US$ 5.38 billion) in the third quarter.  EBITDA increased by 35% to Rs. 9,945 crores (US$ 2.05 billion) in April to December and fell by 3% to Rs. 1,738 crores (US$ 358 million) in the third quarter. 

Liquid steel production at Corus fell by 11% to 13.47 million tonnes in April to December and by 31% to 3.38 million tonnes in the third quarter. Steel deliveries fell by 5% to 16.18 million tonnes in April-December and by 23% to 4.29 million tonnes in the third quarter.

Corus has announced two sets of measures in recent months.  The measures introduced during the third quarter in reaction to the downturn have identified £600 million in savings and cash benefits in the six months to the end of March.  These measures have included action to reduce payroll costs and to align production with the new demand levels.  Corus’ output has been restricted by at least 40% compared to plan and three blast furnaces remain temporarily idled.

In the Netherlands Corus has started to benefit from a government short-time work scheme under which a proportion of employees’ salaries is paid by the state in return for in-house training during those periods in which they have no work. 

Last month the company announced another series of measures, which were designed to address some long-term structural issues.  This programme included the announcement that 3,500 jobs, not only in production, were at risk out of a total workforce of about 42,000. 

Corus has also signed a Memorandum of Understanding with Marcegaglia of Italy and Dongkuk of South Korea to sell a majority stake in its Teesside Cast Products plant. The Company has completed the sale of its Primary Aluminium business.

The British Steel Pension Scheme is in surplus, but, in line with current practice, measures are being taken to limit the company’s contribution to future service for existing scheme members to 12%.

NatSteel

Compared to the same prior-year periods turnover at NatSteel increased by 106% to Rs. 11,049 crores (US$ 2.27 billion) in April to December 2008 and by 54% to Rs. 3,292 crores (US$ 678 million) in the third quarter. EBITDA rose by 36% to Rs. 262 crores (US$ 54 million) in April to December and fell to a loss of Rs. 84 crores (US$ 17 million) in the third quarter compared to a profit of Rs.70 crores (US$ 14 mn).

Finished steel production at NatSteel fell by 4% to 1.13 million tonnes in April to December 2008 and by 19% to 346k tonnes in the third quarter.  Steel deliveries rose by 5% to 1.93 million tonnes in April-December 2008 and fell by 47% to 373k tonnes in the third quarter.

Tata Steel Thailand

Compared with the same prior-year periods turnover at Tata Steel Thailand rose by 19% to Rs. 3,362 crores (US$ 692 million) during April to December 2008 and fell by 46% to Rs. 616 crores (US$ 127 million) in the third quarter. EBITDA fell by 48% to Rs. 110 crores (US$ 23 million) during April to December 2008 and to a loss of Rs. 367 crores (US$ 76 million) in the third quarter compared to a profit of Rs. 110 crores (US$ 23 million). 
Finished steel production at Tata Steel Thailand decreased by 14% to 876k tonnes in April to December and by 49% to 192k tonnes in the third quarter. Steel deliveries decreased by 13% to 882k tonnes in April-December and by 32% to 253k tonnes in the third quarter.

Disclaimer

Statements in this press release describing the Company’s performance may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include, among others, economic conditions affecting demand / supply and price conditions in the domestic and overseas markets in which the Company operates, changes in Government regulations, tax laws and other statutes and incidental factors.

For investor enquiries contact:
Sandip Biswas                                  
Tel : + 91 22 6665 7328/7298                 
Email : sbiswas@tata.com                 

Praveen Sood                     
Tel : + 91 22 6665 7306             
email :  p.sood@tatasteel.com

For media enquiries contact:
Manzer Hussain
Tel : +44 20 7717 4597
email: manzer.hussain@corusgroup.com

Sanjay Choudhry
Tel : +91 657 243 1142
email:  sanjay.choudhry@tatasteel.com

Bob Jones                 
Tel : + 44 20 7717 4532
email: bob.jones@corusgroup.com