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Tata Steel reports Consolidated EBITDA of Rs 23,402 crores for FY2024

Mumbai, May 29, 2024: Tata Steel today reported its financial results for the fourth quarter and year ended March 31, 2024. The company’s consolidated revenues for the quarter stood at Rs 58,687 crores, reflecting a 6% increase from the previous quarter. This growth was driven by improved volumes across various geographies. EBITDA for the quarter was Rs 6,631 crores, with an EBITDA margin of approximately 11%.

For the full fiscal year 2024, Tata Steel reported consolidated revenues of Rs 2, 29,171 crores. The company’s EBITDA for the year was Rs 23,402 crores, primarily bolstered by enhanced performance in its India operations.

Capital expenditure for the quarter was Rs 4,850 crores, contributing to a total of Rs 18,207 crores for the full year. The phased commissioning of the 5 MTPA expansion at Kalinganagar is progressing.

Tata Steel’s net debt stands at Rs 77,550 crores. The group’s liquidity remains robust at Rs 31,767 crores, which includes cash and cash equivalents of Rs 9,532 crores.

Tata Steel India achieved its highest-ever crude steel production of approximately 20.8 million tons and deliveries of around 19.9 million tons in FY2024. Annual India deliveries increased by 9% year-on-year, leveraging India’s steel demand growth and an agile business model. In the fourth quarter of FY2024, India deliveries rose by 5% year-on-year to 5.42 million tons, with revenues at Rs 36,864 crores and an EBITDA of Rs 8,261 crores, resulting in an EBITDA margin of around 22%.

Following seven months of formal and informal national-level discussions with the UK trade unions, Tata Steel will commence the closure of heavy-end assets in June and proceed with its plan to invest in a state-of-the-art Electric Arc Furnace at Port Talbot.

Additionally, Tata Steel’s Board of Directors has recommended a dividend of Rs 3.60 per fully paid-up equity share of face value of Rs 1 each.

Management Comments:

Mr. T V Narendran, Chief Executive Officer & Managing Director:

“FY2024 has been a year of progress for Tata Steel with transition towards stated goals in India and abroad despite the challenging operating environment. In India, which is a structurally attractive market, we have delivered improved margins and continued to expand our footprint in terms of volumes as well as product portfolio. Our domestic deliveries were best ever at around 19 million tons and were up 9% YoY with broad based improvement across chosen market segments. Automotive volumes were aided by higher deliveries of hot-rolled and cold-rolled steel to auto OEMs while our well-established retail brand Tata Tiscon crossed 2 million tons on an annual basis. We have consistently filed 100+ patents per annum, on average, in the last 5 years. Overall, India deliveries now make up 68% of total deliveries and will continue to grow with incremental volumes from 5 MTPA capacity expansion at Kalinganagar. With respect to the UK operations, we have decided to proceed with the proposed restructuring of heavy end UK assets and transition to greener steelmaking after due consideration of all the options over the last 7 months in consultation with union representatives. We are committed to creating a low-CO2 steel business that preserves the majority of the jobs in UK while also creating economic opportunities. In Netherlands, our production was lower due to the relining of BF6. The relining was completed in early February and we have stabilised the operations. We continue to undertake multiple initiatives across geographies to progress on our sustainability journey. I am happy to share that we have achieved zero effluent discharge at our Kalinganagar site in India and have been recognised by worldsteel as Sustainability champion for the seventh time in a row.”

Mr. Koushik Chatterjee, Executive Director and Chief Financial Officer:

Tata Steel Consolidated revenues for FY2024 were around $27.7 billion aided by higher volumes in India.  Consolidated EBITDA was Rs 23,402 crores, which translates to an EBITDA margin of around 10%. India EBITDA increased by 10% YoY to Rs 31,057 crores, with margin improvement of around 200 bps to 22%, translating to Profit after tax (excluding exceptional items) of Rs 17,514 crores. For the quarter, Consolidated revenues were Rs 58,687 crores and EBITDA was marginally higher at Rs 6,631 crores on QoQ basis. Consolidated cash flow from operations was around Rs 7,400 crores for the quarter and Rs 20,300 crores for the full year. Our capital expenditure was Rs 4,850 crores for the quarter and Rs 18,207 crores for the full year, up 29% YoY. Our Group liquidity remains strong at Rs 31,767 crores. The Board has recommended a dividend of Rs 3.60 per share. Moving to strategic initiatives, we have been carefully considering the alternative proposal from the representative body of the UK trade unions and have concluded that maintaining one blast furnace till the transition would have incurred at least £1.6 billion of additional costs, created significant operational and safety risk, and delayed the EAF by two years. We have therefore discussed with the Unions and concluded national level consultation on the asset plan. We will proceed with our proposal to shut down heavy end assets this year, and setup the EAF by 2027. This is a difficult period of change for our people and we will do our upmost to support the affected employees. With respect to the Electric Arc Furnace, we will place equipment orders by Sep 2024 and have signed the agreement with the UK National Grid securing the high voltage connection, which will be available on schedule. We have as part of discussions with the unions, offered the best ever package of support for affected employees in Tata Steel UK. We have also agreed the final and detailed terms of the proposed grant package with the UK government to support the £1.25 billion investment.”

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