Tata Steel had reported a consolidated net loss of Rs 4,648.13 crore for the June quarter of FY21 on August 13. It had reported a loss of 1,615.35 crore in the March quarter and a profit of Rs 714.03 crore in the June quarter of FY20.
Total revenue from operations fell to Rs 24,288.51 crore in Q1 FY21 against Rs 33,769.95 crore sequentially and Rs 35,947.11 crore year-on-year.
Adjusted EBITDA came in at Rs 1,038 crore against Rs 5,530 crore YoY and Rs 4,869 crore QoQ.
On a standalone basis, the company reported a profit of Rs 1,193.27 crore for Q1 FY21 against a profit of Rs 1,538.99 crore YoY and a loss of Rs 436.83 crore QoQ.
The management said its operating level has recovered to 90 percent by June 30 and has since then increased further to 95 percent.
“India’s average steel realisations were lower due to the COVID impact during Q1. About Rs 2,000 crore of costs were under absorbed due to the lower volumes and have been charged to the profit and loss account,” the company said.
Despite the drop in margins, there was a reduction in net debt of Rs 1,677 crore in India, including a reduction of Rs 577 crore and Rs 291 crore at Tata Steel BSL and Tata Steel Long Products, respectively.
The management said that given the uncertain economic environment, it has built up a liquidity buffer of Rs 20,144 crore, including Rs 14,178 crore of cash and cash equivalents.
Commenting on the quarterly performance, TV Narendran, CEO and Managing Director, said: “We were successful in mitigating the impact of COVID-19 as we pivoted the business towards export markets and successfully generated free cash flows despite adverse market conditions.”
Narendran said he is cautiously optimistic that ‘the worst is behind us’.
Koushik Chatterjee, Executive Director and CFO, said: “Tata Steel Europe’s performance was affected by lower deliveries and a sharp decline in European spreads to an unsustainably low level. As a result, our consolidated adjusted EBITDA dropped to Rs 1,038 crore.”