Tata Steel posts Rs 503 cr net profit in Dec quarter

Written by PTI | New Delhi | Updated: Feb 12 2014, 15:43pm hrs
Tata SteelTata Steel shares today gained 2 per cent to end at Rs 390.15 apiece on the BSE. Reuters
Tata Steel today posted a consolidated net profit of Rs 503.24 crore for the October-December quarter, buoyed by better operational performances in both India and Europe.

The company, however, said market conditions continue to be challenging in all geographies.

Tata Steel had clocked Rs 763.06 crore net loss in the October-December quarter last fiscal. However, it had logged Rs 917 crore net profit in the July-September 2013 quarter.

Total income of the company in the third quarter of this fiscal rose 14 per cent to Rs 36,736 crore from Rs 32,107 crore on higher sales, which stood at 6.83 million tonnes (MT) from 5.83 MT a year earlier.

Sales from Indian operations stood at 2.07 MT while it went up to 3.19 MT in Europe from 3.02 MT a year ago. It sold 1.09 MT steel from its operations in South East Asia.

"The market conditions continue to be challenging in all geographies with contracted spreads between steel realisations and raw material prices," said Koushik Chatterjee, Group Executive Director (Finance and Corporate), in a statement.

Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of its Indian operations improved to Rs 3,131 crore from Rs 2,525 crore a year ago. It also increased in Europe to Rs 860 crore from a loss of Rs 428 crore in the year-ago period.

T V Narendra, Managing Director, Tata Steel India and South East Asia said domestic steel markets continued to remain weak during the quarter with the economy and most of the steel consuming sectors facing severe headwinds.

"We are hopeful that the sentiment improves in the seasonally strong fourth quarter and with the shutdowns now behind us, Tata Steel should achieve robust operational improvement," he said.

Karl-Ulrich Khler, Tata Steel Europe's Managing Director and CEO said that the asset base the company had restored and upgraded last year led to a continued year-on-year turnaround in financial performance.

"The work to enhance our product and service profile and our focus on cost and cash flow continued, supporting the year-on-year improvement in EBITDA, despite lower margins.

"With European economic indicators improving, these efforts will better enable us to benefit from any growth in European steel demand, which remains at historically low levels," he said.

Tata Steel shares today gained 2 per cent to end at Rs 390.15 apiece on the BSE.