Thursday, May 15, 2014

News: Tata Steel posts more good results

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Tata Steel has seen an increase in production, sales and overall performance, for its important European operations.

The Indian-owned steelmaker, that operates sites in Rotherham and Stocksbridge, published results for the financial year and fourth quarter ended March 31 2014.

The turnaround has been put down to the restart of the Port Talbot blast furnace and the successful launch of new, differentiated products, sales of which have increased by more than 75%.

In 2012, Tata Steel Europe outlined a new strategy to target demanding industries, like automotive, aerospace, mechanical engineering and construction. South Yorkshire is home to the production of specialist steel used in aerospace and a restructured bar business now focusing on supplying hi-tech products.

In Europe, turnover for the year to March 31 was £8.4 billion versus £7.8 billion in the previous year, despite Tata stating that average market conditions were worse than in the previous year.

EBITDA (earnings before tax) for its European operations in the 2014 financial year was at £301m, quadrupling from the £76m reported in the same period last year. If depreciation and amortisation are taken into account, earnings drop to a loss of £16m compared to the loss of £283m in the previous year. Recent reports from India suggest that the company is to undergo a plan of refinancing its estimated £4 billion debt in Europe.

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In Europe last year liquid steel production increased by 16 per cent to 15.46 million tonnes and deliveries also increased six per cent to 13.86 million tonnes.

Dr Karl-Ulrich Köhler, MD & CEO of Tata Steel in Europe, said: "The key to last year was our relentless focus on operational reliability, which restored our asset base and enabled our production to return to more usual levels. Our financial performance improved as a result.

"At the same time we advanced our high-quality portfolio programme, launching 30 new products as promised and increasing sales of new products by more than 75%. By intensifying our innovation efforts, our sales to automotive manufacturers grew against trend - a third of these sales were differentiated products which helped customers deliver cost, weight and performance improvements.

"Europe appears to be entering a phase of solid economic growth, which is supporting a recovery in steel demand. But EU steel use will remain at low levels historically against a background of continuing global overcapacity. Faced with these challenges we will intensify our efforts to achieve sustainable financial performance by continuing to improve the support and services we offer our customers and maintaining our focus on costs and operational efficiency."

Tata Steel website

Images: Tata Steel

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