Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q3 FY2020 Earnings Presentation
24 slides from Tata Steel's earnings presentation, Feb 7, 2020
Slide 1: Results Presentation
Results Presentation Financial quarter and nine month ended December 31, 2019 February 07, 2020 1
Slide 2: Safe harbor statement
Safe harbor Statements in this presentation describing the Company’s performance may be statement “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results may differ materially from those directly or indirectly expressed, inferred or implied. Impo
Slide 3: Committed towards excellence in Safety, Health & Sustainability
Committed towards excellence in Safety, Health & SAFETY HEALTH SUSTAINABILITY Sustainability ▪ More than 44,000 contract ▪ Organized awareness ▪ Tata Steel has been identified as a employees trained and certified campaigns on ‘Diabetes global leader for engaging with its in various safety skills Pre
Slide 4: Engaging with neighbouring communities and improving their life quality
Engaging with ▪ 1000 Schools Projects –1,370 schools and over 1,00,000 TSL Standalone – CSR Spend (Rs. crores) neighbouring children supported in Odisha and Jharkhand 315 communities Education ▪ 30 Model schools – 22 schools completed, 19 handed over and improving ▪ Pre-Metric coaching support – 5,1
Slide 5: Key performance highlights and updates
Key performance highlights and updates Group performance India business Financial Health ▪ Consolidated EBITDA was ▪ Delivered 17%QoQ volume ▪ Net Debt reduced by Rs.2,324 Rs.3,659 crores, EBITDA margin growth despite 3%QoQ decline in crores during the quarter of 10.3%, EBITDA per ton of domestic de
Slide 6: Global macro and business environment
World GDP growth (% YoY) and China crude steel production and Global macro ▪ Global GDP growth further slowed global manufacturing PMI domestic consumption1 (mn tons) and business down in 3QFY20 amidst heightened JPMorgan Global Manufacturing PMI Production Consumption World GDP Growth (RHS) environ
Slide 7: India macro and business environment
India macro ▪ Indian economy remained weak Manufacturing PMI and FY20 GDP and business in 3QFY20; all the key agencies growth estimates over the last year Key sectors growth* (% Change, YoY) have been trimming India GDP PMI Mfg. (RHS) IMF environment growth estimates for FY20 World Bank RBI OECD 3QF
Slide 8: Europe macro and business environment
Europe macro ▪ European Union GDP grew by and business EU GDP (%, YoY) EU key steel consuming sectors (%YoY) 1.1%YoY in 3QFY20 while Construction -GVA environment expanded marginally on QoQ basis 3 Mechanical Engineering - GVA Automotive - production volume 8% ▪ Manufacturing sector remains in 2 4%
Slide 9: Consolidated operational and financial performance
Consolidated (All figures are in Rs. Crores unless stated otherwise) 3QFY20 2QFY20 3QFY19 operational Production (mn tons)1 6.99 6.95 6.71 and financial Deliveries (mn tons) 7.31 6.53 6.47 performance Total revenue from operations 35,520 34,579 38,854 Raw material cost2 13,754 14,864 15,389 Change i
Slide 10: Consolidated Adjusted EBITDA movement
Consolidated ₹ Crores Adjusted EBITDA1 4,019 movement ▪ Selling results reflects sequentially lower steel prices across geographies especially Europe 207 587 56 2,643 ▪ Lower costs across geographies due to lower raw material prices 2,225 ▪ Volume/mix impact due to higher deliveries across geographi
Slide 11: Tata Steel India: Quarterly production and delivery volumes
Tata Steel Crude Steel Production Volume (mn tons) ▪ Total deliveries grew 17%QoQ with 15%QoQ increase in domestic India1: deliveries; despite 3% decline in India’s apparent steel consumption Quarterly 4.47 4.50 4.38 ▪ Maintained Automotive segment deliveries on QoQ basis amidst production 13%QoQ de
Slide 12: Branded Products and Retail
Branded ▪ Continued focus on physical and digital channel expansion helps improve market penetration and drive volumes Products o On the ground distributor/dealer network increased by 11% YoY and Retail o Digital channel scales up: ✓ ‘Tata Steel AASHIYANA’ - India’s first ever multi-brand e-commerce
Slide 13: Tata Steel Standalone: Financial performance
Tata Steel (All figures are in Rs. Crores unless stated otherwise) 3QFY20 2QFY20 3QFY19 Standalone: Total revenue from operations 15,262 14,871 17,174 Financial Raw material cost1 4,210 5,151 5,828 performance Change in inventories 1,326 (366) (928) EBITDA 3,791 3,546 4,559 Adjusted EBITDA2 3,470 3,
Slide 14: Tata Steel Standalone: Adjusted EBITDA movement
Tata Steel ₹ Crores Standalone: Adjusted EBITDA1 578 ▪ Selling results reflects sequentially movement 3,470 lower steel realizations 3,331 254 408 ▪ Cost improvement is primarily due to lower coal cost and lower consumption of purchased pellet 1,101 ▪ Volume/mix impact primarily due to higher delive
Slide 15: Tata Steel Standalone: Key sustainability parameters
Tata Steel Coke Rate (kg/tcs) Specific Energy Intensity (Gcal/tcs) Specific Water Consumption (m3/tcs) Standalone: Key 7.29 Good Good Good 5.54 443 434 6.42 sustainability 6.31 6.01 399 4.75 5.77 381 5.68 5.67 5.67 5.67 367 4.39 360 356 4.27 4.25 352 348 parameters 3.83 3.68 3.27 2.97 FY15 FY16 FY17
Slide 16: Tata Steel Kalinganagar Phase 2 expansion
Tata Steel Key ▪ Cold Rolling Mill (CRM) complex and Pellet plant have been prioritized to improve product mix and Kalinganagar updates bring cost efficiency Phase 2 ▪ CRM Complex: expansion o Pickling Line and Tandem Cold Rolling Mill (PLTCM) - Civil and structure construction has progressed substa
Slide 17: Tata Steel BSL: Consolidated performance and key updates
Tata Steel BSL: (All figures are in Rs. Crores unless stated otherwise) 3QFY20 2QFY20 3QFY19 Consolidated Crude Steel production (mn tons) 1.15 1.07 1.04 performance Deliveries (mn tons) 1.26 1.04 0.92 and key updates Total revenue from operations 5,038 4,555 4,889 Raw material cost1 2,630 2,720 2,8
Slide 18: Tata Steel Long Products: Consolidated performance and key updates
Tata Steel Long (All figures are in Rs. Crores unless stated otherwise) 3QFY20 2QFY20 3QFY19 Products: Production (‘000 tons) Consolidated - Crude Steel 157 150 NA performance - Sponge 221 172 109 Deliveries (‘000 tons) and key updates - Steel 162 118 NA - Sponge 187 141 112 Total revenue from opera
Slide 19: Tata Steel Europe: performance and key updates
Tata Steel Europe: (All figures are in Rs. Crores unless stated otherwise) 3QFY20 2QFY20 3QFY19 performance Liquid Steel production (mn tons) 2.51 2.45 2.34 and key updates Deliveries (mn tons) 2.35 2.29 2.35 Total revenue from operations 13,821 14,035 15,850 Raw material cost1 6,240 6,431 6,395 Cha
Slide 20: Consolidated debt movement
Consolidated Rs. Crores Debt movement 2,539 643 784 1,11,549 312 1,373 1,09,867 3,922 3,368 1,04,628 2,845 1,00,816 5,239 Acquisiton of UML's Addition of new Addition of new Net Debt Gross Debt Gross Debt Gross Debt Cash, Bank & FX Impact and Recoginition of lease Loan movement FX impact and Loan mo
Slide 21: Business Outlook
Business Outlook ▪ Global steel demand is expected to improve on sustained monetary stimulus and restocking; however, Coronavirus is a risk Steel Demand ▪ India steel demand is expected to improve in seasonally stronger 4QFY20 with increase in the government spending and improving liquidity ▪ Steel
Slide 22: Annexure – I: Standalone QoQ Variations
Annexure – I: Rs Crores 3QFY20 2QFY20 Key Reasons Standalone Income from operations 14,817 14,487 Due to higher deliveries partially offset by lower realisations QoQ Variations Other operating income 445 385 Primarily due to higher export related benefits with higher exports Primarily due to lower c
Slide 23: Annexure – II: Consolidated QoQ Variations
Annexure – II: Rs Crores 3QFY20 2QFY20 Key Reasons Income from operations 34,774 33,954 Primarily due to higher deliveries across geographies Consolidated Other operating income 746 625 Primarily at standalone and Tata Steel BSL QoQ Variations Lower primarily at standalone, Tata Steel BSL and Tata S
Slide 24: Contact
Contact Investor enquiries : Sandep Agrawal Tel: +91 22 6665 0530 Email: sandep.agrawal@tatasteel.com 24