OREANDA-NEWS. Tata Steel Group today declared its Consolidated Financial Results for the first half and second quarter ended September 30, 2014. Performance remained stable as Group Turnover and EBITDA came in at 35,777 crores and 3,750 crores respectively. Net profit for the quarter was 1,254 crores.

Executive Comment

Mr T V Narendran, Managing Director of Tata Steel India and South East Asia, said: "Despite subdued market conditions, Tata Steel registered an all-around growth in H1 with an increase in both, saleable production and deliveries. Our strategy of focusing on the auto segment, particularly the high end segment, and the retail market yielded rich dividends. Our focus on product mix enrichment has resulted in a 22% yoy increase of sales to the automotive segment and a 38% yoy increase in the hi-end segment.

We are hopeful that the stable political climate will trigger a steel-intensive economic revival and we are well positioned to take advantage of any improvement in the steel demand in the country.

We continue to make good progress towards completion of the project execution in KPO. While there are some challenges in securing all the necessary linkages, the same are being addressed in cooperation with the government."

Dr Karl-Ulrich Kohler, MD & CEO of Tata Steel in Europe, said: "Our financial performance again showed how our product portfolio enhancement continues to build on the progress we've made so far. We are on track with our new product launch plans and with our programme to raise the proportion of differentiated products in our sales.

The potential sale of our Long Products Europe business and its associated distribution facilities would enable us to devote greater resources to pursuing our focus on strip steel customers. We will treat affected employees fairly and with respect throughout the due diligence process, and will consult fully with their representatives.

We see headwinds constraining steel demand growth globally. In Europe we are increasingly concerned about the impact of rising imports, particularly from China, on EU steelmakers."

Mr Koushik Chatterjee, Group Executive Director (Finance and Corporate), said: "Despite several challenges in the market and the environment, the Tata Steel Group was able to maintain its profitability levels during the quarter. The Company generated around Rs 4,400 crores of cash flows from operations that was deployed primarily in the ongoing capital expenditure program helping us marginally decrease the net debt levels.

The Company has also significantly de-risked the Balance Sheet with the completion of the refinancing of the international debt portfolio at better than before terms and long tenured repayments.

While the Group across geographical entities continue to focus on internal improvement initiatives, there are several external factors that continues to put challenges to the business especially declining spreads in Europe and South East Asia due to Chinese exports and lower commodity prices and the uncertainty created on the renewal of the mines in India due to various hurdles that has the potential to impact the company if not resolved urgently."