Tata Steel Q1 net profit up nearly 3-fold at Rs 5,346 cr
Tata Steel today reported a nearly three-fold jump in its consolidated net profit at Rs 5,346.55 crore for the quarter ended June 30, on one-time gains in selling stakes in Riversdale and Tata Refractories and a settlement of claims at Teesside Cast Products unit in the UK.
The company had reported a net profit of Rs 1,825.26 crore during the corresponding quarter of last fiscal. Net sales of the company also rose by 21.58 per cent to Rs 32,839.90 crore during the quarter under review, compared to Rs 27,010.06 crore, the company said in a filing to the Bombay Stock Exchange (BSE).
The filing added that in the April-June quarter, the company realised Rs 4,942.07 crore (AUD 1,060 million) by selling its entire 26.27 per cent stake in the Australian mining firm Riversdale to Rio Tinto.
Of this, the company included Rs 2,879.29 crore as one time profit in its results from the sale of its stake in Riversdale, the filing further said. Besides this, the company also made a profit of Rs 511.01 crore by selling its stake in Tata Refractories Ltd to Krosaki Harima Corporation, an associate firm of Nippon Steel of Japan.
Tata Steel, in May, had offloaded 51 per cent stake in group company Tata Refractories to Krosaki Harima and inducted the Japanese firm as a strategic partner. The deal was valued at Rs 576.3 crore, going by the Tata Refractories's (TRL) valuation at Rs 1,130 crore.
Moreover, the company also gained from settlement of disputes at its Teesside Cast Products (TCP) unit in UK, following a partial final award in its favour in an arbitration proceeding between Tata Steel UK and certain off-takers of the TCP. "Following that partial final award, a commercial settlement to all disputes relating to the off-take agreements was reached and on June 21, 2011 the Company completed a full and final settlement of claims with the consortium of former off-takers.
As a result of this settlement, Tata Steel has received an aggregate sum of Rs 598 crore (USD 134 million)," it said in a statement. During the quarter, company's India unit reported a robust growth as its net sales increased by 20.41 per cent at Rs 7,792.20 crore as compared to Rs 6,471.27 crore in the corresponding period last fiscal.
Commenting on the results, Tata Steel's Managing Director H M Nerurkar said, "Our next expansion phase at Jamshedpur will start coming on stream in the last quarter of this financial year and the Odisha greenfield project is progressing well, with the first 3 million tonnes per annum phase due for commissioning in 2014."
