26 January 2024
Corporate News

UK business continues to report significant losses

Financial

Tata Steel UK’s third quarter results were this week announced as being losses of £159 million* – a daily loss of £1.7million for the 92-day period.
This follows the Q2 losses of £135 million and brings the UK business’s losses for April to December 2023 to £330 million.

This was despite the company using less in raw materials and energy due to operational challenges.

Commenting on the results Koushik Chatterjee, Executive Director and Chief Financial Officer of the parent company Tata Steel Limited, said: “The UK business continues to face production shortfalls arising from the end-of-life condition of several of its heavy end assets.

“We are keen to create a business (in the UK) that is not always standing at the edge of a cliff, which is always struggling to survive. We want to make sure that at the end of this transition…we’ll have a business that can stand on its own.” TV Narendran

“Our announcement on 19 January in relation to Tata Steel UK follows detailed discussions with and careful consideration of the alternative proposal from the representative body of the UK trade unions and their advisor. 

“The company’s analysis shows that partial continuity of blast furnaces until completion of transition to the Electric Arc Furnace (EAF) is not affordable, and engineering studies have found that building the EAF in an already operating steel melt shop is not feasible. 

“Tata Steel is acutely aware of the impact of its proposal to wind down the heavy end in Port Talbot on individuals and the local community associated with our steel works, we will meaningfully consult with our employees and work to provide them with a fair, dignified and considerate outcome.” 

Tata Steel’s CEO and MD TV Narendran speaking to moneycontrol said: “We are keen to create a business (in the UK) that is not always standing at the edge of a cliff, which is always struggling to survive. We want to make sure that at the end of this transition…we’ll have a business that can stand on its own.”

Mr Chatterjee continued: “Tata Steel proposes to commit in excess of £130 million to a comprehensive support package for affected employees. This is in addition to the £100 million funding for the Transition Board set up by the company along with the UK and Welsh governments. 

“Tata Steel has begun engineering design work on the EAF and discussions with National Grid for supporting infrastructure with a target to commission the EAF by 2027.”
 
*Earnings Before Interest Tax Depreciation and Amortisation

 

Full results are available here: Tata Steel reports Consolidated EBITDA of Rs 16,771 crores for the first nine months of the financial year

Mr Koushik Chatterjee, Executive Director and Chief Financial Officer of Tata Steel Limited

About Tata Steel UK

  • The Tata Steel Group has been named one of the most ethical companies in the world, and is among the top producing global steel companies with an annual crude steel capacity of 34 million tonnes. 
  • Tata Steel in the UK has the ambition to produce net-zero steel by 2045 at the latest, and to have reduced 30% of its CO2 emissions by 2030. 
  • Tata Steel is the largest steelmaker in the UK with primary steelmaking at Port Talbot in South Wales supporting manufacturing and distribution operations at sites across Wales, England and Northern Ireland as well as Norway, Sweden, France and Germany. It also benefits from a network of international sales offices around the world.
  • Tata Steel employs more than 8,000 people and has an annual crude steel capacity of 5 million tonnes, supplying high-quality steel products to demanding markets, including construction and infrastructure, automotive, packaging and engineering. 
  • Tata Steel Group is one of the world's most geographically-diversified steel producers, with operations and a commercial presence across the world. 

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