Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q3 FY2014 Earnings Presentation
29 slides from Tata Steel's earnings presentation, Feb 11, 2014
Slide 1: Results Presentation Third Quarter Ended 31st December 2013
February 11, 2014 Results Presentation Third Quarter Ended 31st December 2013
Slide 2: Disclaimer
Disclaimer Statements in this presentation describing the Company’s performance may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference
Slide 3: Tata Steel Group – Health and Safety
Tata Steel Group – Health and Safety Lost Time Injury Frequency (LTIF) Reduction continues in lost time injuries with 9 month FY14 performance 8% 3.5 3.06 better than FY13 3.0 The new leadership team has set an 2.5 2.35 ambition to make Tata Steel sustainably 2.10 2.0 fatality free 1.5 1.31 Co
Slide 4: Tata Steel Group continues to focus on engaging with communities and improving quality of life
Tata Steel Group continues to focus on engaging with communities and improving quality of life India No. of adults turned literate 16,000 13,570 Infrastructure 5,600 Education Ethnicity Development 2,295 2,555 Livelihoods Health (incl skills) (incl water) FY'10 FY'11 FY'12 FY'13 FY'14 (plan) Sports
Slide 5: Tata Steel Group continues to focus on engaging with communities and improving quality of life
Tata Steel Group continues to focus on engaging with communities and improving quality of life Europe •Tata Steel supported the Richard Burton 10km & Family Fun Run in South Wales, UK •Achieved largest number of runners at 800+ •Tata Steel held its Industrial Cadets programme for youngsters in Scunt
Slide 6: Agenda
Agenda Consolidated Highlights Performance of Indian and South East Asian Operations Performance of European Operations Group Financial Performance Key Developments 6
Slide 7: Steel Market Developments
Steel Market Developments Global crude steel production & capacity utilisation Market Spread* (€/tonne) 140 Crude steel production (Mt, LHS) 100% 500 130 Capacity utilisation (%, RHS) 90% 400 120 110 80% 300 100 90 70% 200 80 60% 100 70 60 50% 0 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012
Slide 8: Group Financial Highlights
Group Financial Highlights Third Quarter Ended 31st Dec, 2013 Deliveries Mn T Turnover Rs. Crore 36,645 36,736 6.48 6.38 32,107 5.82 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 EBITDA Rs. Crore PAT Rs. Crore 3,784 3,921 917 503 2,252 -763 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 8 * PAT f
Slide 9: Key Drivers
Key Drivers Third Quarter Ended 31st Dec, 2013 India Higher deliveries despite weak macroeconomic conditions and lower production Sequential improvement in realisations Europe Rigorous approach to costs and cashflow helped maintain q-o-q financial performance Continued production improvement
Slide 10: Agenda
Agenda Consolidated Highlights Performance of Indian and South East Asian Operations Performance of European Operations Group Financial Performance Key Developments 10
Slide 11: Performance of Tata Steel India
Performance of Tata Steel India Third Quarter Ended 31st Dec, 2013 Production Mn T Deliveries Mn T 2.21 2.15 2.07 2.04 2.07 1.89 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 Turnover Rs. Crore EBITDA Rs. Crore 10,143 3,202 9,921 3,131 9,370 2,525 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 11
Slide 12: Performance of Tata Steel India
Performance of Tata Steel India Flats, Longs and FAMD 2.0 Flat Products Long Products 1.0 1.5 1.48 0.8 1.44 1.41 0.81 0.80 1.36 0.77 1.26 1.0 1.09 0.6 0.68 0.67 0.66 0.5 0.4 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 Production (in MnT) Sales (in MnT) Production (in MnT) Sales (in MnT) Operat
Slide 13: Performance of South East Asia
Performance of South East Asia Third Quarter Ended 31st Dec, 2013 Production Mn T Deliveries Mn T 1.09 0.82 0.96 0.77 0.72 0.82 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 Turnover Rs. Crore EBITDA Rs. Crore 4,537 144 4,179 137 129 3,465 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 13
Slide 14: Agenda
Agenda Consolidated Highlights Performance of Indian and South East Asian Operations Performance of European Operations Group Financial Performance Key Developments 14
Slide 15: Performance of Tata Steel Europe
Performance of Tata Steel Europe Third Quarter Ended 31st Dec, 2013 Liquid Steel Production Mn T Deliveries Mn T 3.86 3.91 3.46 3.19 3.29 3.02 Q3 FY13 Q2 FY14 Q3 FY14 Q3 FY13 Q2 FY14 Q3 FY14 Turnover GBP mn EBITDA GBP mn 2,196 2,073 2,066 87 55 Q3 FY13 Q2 FY14 Q3 FY14 -50 Q3 FY13 Q2 FY14 Q3 FY14 15
Slide 16: European operations
European operations EBITDA bridge Q3 FY2014 vs. Q2 FY2014 £ million 3 months 100 Central to Dec 2013 & Other £18m 75 Manufacturing 3 months to Sep Production Selling Cost Changes £87m 2013 Volume £12m Result 50 £(17)m £19m £55m 25 0 16
Slide 17: European update
European update Performance improvements continue Rigorous approach to costs and stable production rates resulted in improved y/y EBITDA performance, despite lower margins Upgraded and stable operational base led to highest quarterly liquid steel production in more than five years Enhancements
Slide 18: Agenda
Agenda Consolidated Highlights Performance of Indian and South East Asian Operations Performance of European Operations Group Financial Performance Key Developments 18
Slide 19: Group Financial Performance – Q3 FY14
Group Financial Performance – Q3 FY14 Figures in Rs. Crore unless specified Q3 FY14 Q2 FY14 Q3 FY13 Figures in Rs. Crore unless specified India Europe SE Asia Others Group Group Group Deliveries (Mn T) 2.07 3.19 1.09 0.02 6.38 6.48 5.83 Turnover 10,143 20,709 4,537 1,347 36,736 36,645 32,107 Raw Mat
Slide 20: Standalone Results – QoQ Variations
Standalone Results – QoQ Variations All figures in Rs. Crore Particulars Q3 FY14 Q2 FY14 Key Reasons Higher volumes and realisations in FP and higher realisation for LP partly Net sales 10,040 9,826 compensated by decrease in LP volumes Other operating income 103 95 Broadly similar Changes in invent
Slide 21: Consolidated Results – QoQ Variations
Consolidated Results – QoQ Variations All figures in Rs. Crore Particulars Q3 FY14 Q2 FY14 Key Reasons Higher deliveries in both Tata Steel India (TSI) and Natsteel alongwith Net sales 36,410 36,370 better realisation in most of the regions Other operating income 326 275 Broadly similar Changes in i
Slide 22: Net Debt Movement and Liquidity Position
Net Debt Movement and Liquidity Position Net debt movement 11,056 15,592 8,925 77,113 76,500 (11,485) (185) 70,129 69,373 (6,371) 66,074 (13,477) (755) Gross Debt Loans Loans Forex Impact Gross Debt Loans Loans Forex Impact Gross Debt Cash & Net Debt Forward Underlying Mar 13 taken repaid Sep 13 tak
Slide 23: Pensions Status – European Operations
Pensions Status – European Operations IAS 19 (2008) Valuation Figures in £ mn Dec-12 Sep-13 Dec-13 Total Scheme Retirement Benefit Assets 17,677 18,096 18,157 Total Scheme Retirement Benefit Liabilities (17,599) (17,854) (17,856) Net Pension Surplus (BSPS &SPH) 78 242 301 Pension Asset Composition –
Slide 24: Agenda
Agenda Consolidated Highlights Performance of Indian and South East Asian Operations Performance of European Operations Group Financial Performance Key Developments 24
Slide 25: KPO Project Update
KPO Project Update 25
Slide 26: Raw Material Projects
Raw Material Projects Benga Project, Mozambique About 0.81mt of hard coking coal shipped in 2013 Severe monsoons and security issues had disrupted shipments in the first half of 2013 Phase II expansion delayed pending more clarity on rail and port capacity enhancements Direct Shipping Ore Projec
Slide 27: Business Outlook
Business Outlook India: Sentiment has improved; though sectors like construction and auto continue to be under pressure Rupee depreciation is helping to restore balance in the market Europe: EU steel demand expected to show signs of gradual recovery in Q4 (+3.3%) from a low base and could tran
Slide 28: Thank You
qp TATA Thank You TATA STEEL 28
Slide 29: Contact Information
Contact Information For investor enquiries contact: For media enquiries contact: Samita Shah Kulvin Suri Tel: +91 22 6665 7371 Tel: +91 657 664 5512 / Email: samita.shah@tatasteel.com +91 92310 52397 Email:kulvinsuri@tatasteel.com Subhra Kanti Das Bob Jones Tel: +91 22 6665 7382 Tel: +44 207 717 453