28 August 2008
Corporate News
Tata Steel Group Q1 results

The Company declared the standalone financial statements for Tata Steel (India) for the fiscal first quarter ended June 30 2008 on July 31 2008.

The Company declared the consolidated Group financial results for the quarter ended June 30 2008 on August 28 2008.

Highlights for Tata Steel Group

Higher Turnover

Group Turnover during the quarter ended June 30 2008 amounted to US$10.147 billion (Rs.43,561 crores), registering a growth of 39% over the US$7.29 billion (Rs.31,296 crores) during the same period of the previous year.

Increased EBIDTA

Group EBIDTA increased by 41% to US$1.637 billion (Rs.7,027 crores) during the quarter ended June 30 2008 against US$1.157 billion (Rs.4,968 crores) during the quarter ended June 30 2007.

Higher Profit before exceptional items and tax

Earnings before exceptional items and tax during the quarter ended June 30 2008 amounted to US$1.191 billion (Rs.5,111 crores) against US$718 million (Rs.3,081 crores) for the quarter ended June 30 2007.

Increased Return on Invested Capital

ROIC (pre-tax) for the Group improved from 21% in April to June 2007 to 30% in April to June 2008

Higher Deliveries

Total deliveries / external sales for the quarter ended June 30 2008 were 8.59 million tonnes against 7.71 million tonnes for the quarter ended June 30 2007.

 

Detailed commentary on performances

Indian operations

EBIDTA in the quarter April to June 2008 was at US$707 million (Rs.3,037 crores), 73% higher than the EBIDTA of US$408 million (Rs.1,752 crores) for the quarter April to June 2007.

The company continued to improve its performance during the quarter ended 30th June 2008 through margin improvement, product mix and increase in volume in line with its overall annual target.

Finished steel production volume for the quarter April to June 2008 was 1.19 million tonnes against 1.07 million tonnes for the quarter ended June 2007, an increase of almost 12%.

Sales volume for the quarter April to June 2008 was 1.16 million tonnes, 11% higher than the 1.04 million tonnes for the quarter April to June 2007.

On May 31 2008 Asia’s largest Blast Furnace, the ‘H’-Blast Furnace, was blown in at Jamshedpur.

UK & European Operations

EBIDTA in the period April to June 2008 was at US$786 million (Rs.3,376 crores), 11% higher than the EBIDTA of US$710 million (Rs.3,048 crores) in April to June 2007.

Performance improvement during the quarter was in line with the overall target of US$600 million (Rs.2,576 crores). This was achieved primarily through an increase in volume, product mix improvement, and productivity gains, especially in the Long Products division.

Sales volume for the quarter April to June 2008 was 6.21 million tonnes, 7% higher than the 5.80 million tonnes for the period April to June 2007.

Liquid steel production for the quarter April to June 2008 at 5.20 million tonnes was at the same level as in the corresponding quarter of the previous year.

There were significant price increases during the quarter, offsetting most of the input price increases.

South-East Asian Operations:

Natsteel

EBIDTA in the quarter April to June 2008 was at US$49 million (Rs.209 crores), 227% higher than the EBIDTA of US$15 million (Rs.66 crores) in April-June 2007.

Sales volume for the quarter April to June 2008 was 830,000 tonnes, 57% higher than the 530,000 tonnes for the quarter April to June 2007.

Production volume for finished steel for the quarter April to June 2008 was 409,000 tonnes, 8% higher than the 379,000 tonnes during the quarter April to June 2007.

In Singapore, demand for steel products was robust during the quarter due to continued construction demand.

There was marked improvement in demand for cut and bend and mesh products in Australia.

Tata Steel Thailand

EBIDTA in April to June 2008 was at US$92 million (Rs.393 crores), 475% higher than the EBIDTA of US$16 million (Rs.69 crores) for April to June 2007.

Sales volume for the quarter April to June 2008 was 350,000 tonnes, 17% higher than the 300,000 tonnes for the quarter April to June 2007.

Production volume for the quarter April to June 2008 was 371,000 tonnes, 20% higher than the 311,000 tonnes for the quarter April to June 2007.

All three plants’ meltshops operated at full capacity and their rolling mills operated beyond their rated capacity, resulting in a rise in finished product output of 55,000-60,000 tonnes.

Return on Invested Capital

Return on Invested Capital (pre-tax) increased from 21% (annualised) for the quarter April to June 2007 to 30% (annualised) for the quarter ended June 2008. The increase in ROIC was primarily driven by increased margin during the quarter from 12.8 % in the quarter April to June 2007 to 13.8% in the quarter April to June 2008 due to higher price realisation in the international operations, higher volume and improved productivity. Working Capital management for the quarter also improved leading to the increase in Asset Turnover from 1.65 (times) in the quarter April to June 2007 to 2.19 (times) in the quarter April to June 2008.
                    

For more information please visit the Tata Steel website

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