BENGALURU (Reuters) – India’s Tata Steel on Monday reported a staggering 92% slump in quarterly profit, hurt by the lower prices of alloy and expenses related to a pension scheme in Britain.
Consolidated net profit came in at 6.34 billion rupees ($77.5 million) for the three months to June 30, while total revenue from operations fell 6.2% to 594.90 billion rupees from a year earlier.
The profit was hit by a non-cash deferred tax charge related to British Steel Pension Scheme, Tata Steel said in a statement.
Overall expenses jumped about 13% to 585.53 billion rupees.
Tata Steel, which has an annual crude steel capacity of 35 million tonnes per annum, said steel spot prices moderated during the quarter.
Volatility in steel markets have impacted working capital and cash flows, CFO Koushik Chatterjee said.
The company, which has been waiting for a financial package from the UK government, had indicated in the past that it would take a call on continuing operations there with some of the downstream assets nearing the end of life.
Rival JSW Steel last week reported a nearly three-fold jump in first-quarter profit on higher demand from infrastructure projects.
While domestic demand has been rising for Indian metals companies, subdued demand from top consumer China remained a drag on prices.
The board also re-appointed CEO T. V. Narendran for five years through September 2028.
($1 = 81.8127 Indian rupees)
(Reporting by Sethuraman NR in Bengaluru; Editing by Dhanya Ann Thoppil)
