Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q3 FY2019 Earnings Presentation
25 slides from Tata Steel's earnings presentation, Feb 8, 2019
Slide 1: Submission of presentation to stock exchanges
4 i ri TATA February 8, 2019 The Secretary, Listing Department The Manager, Listing Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, 5th Floor, Plot No. C/1, Dalai Street, G Block, Bandra-Kurla Complex, Bandra (E), Mumbai - 400 001, Maharasht
Slide 2: Results Presentation: Financial quarter ended December 31, 2018
Results Presentation Financial quarter ended December 31, 2018 February 08, 2019 1
Slide 3: 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 4: Committed towards excellence in Safety, Health & Sustainability
Committed towards excellence in Safety, Health & SAFETY HEALTH SUSTAINABILITY Sustainability ▪ WSA has recognized Tata ▪ Implemented 17 Industrial ▪ Industry Leader in DJSI 2018 Steel’s ‘Process Safety Hygiene hazards control Assessment amongst 24 Management’ practices as one projects to minimize th
Slide 5: A compelling investment case
A compelling Strong ▪ Strong and ‘best in class’ assets – Jamshedpur, Kalinganagar and Angul investment foundation ▪ Indian operations are at globally competitive cost position in India case ▪ Focus on Indian markets – best positioned to Current: 33 MTPA1 2025: 32 MTPA2 leverage India growth story ▪
Slide 6: Key performance highlights and updates
Key performance 3QFY19 – key performance indicators Increasing India footprints highlights and ▪ Indian operations contributed 3.89 mn tons out of ▪ Kalinganagar 5MTPA Phase II expansion is on track updates consolidated deliveries of 6.99 mn tons ▪ Tata Steel BSL – Long term financing completed; ▪ C
Slide 7: Global macro and business environment
Global macro ▪ Global economic growth has slowed World GDP growth (%YoY) Crude Steel production (mn tons) and business down but remains above CY16 lows 2017 2018 ▪ 3QFY19 5 928 environment ▪ Key concerns were tightening financial 841 861 871 3 236 markets, Brexit uncertainty and trade war escalation
Slide 8: India macro and business environment
India macro ▪ Domestic steel demand softened during the Steel production, demand and net mports (mn tons) and business quarter Crude steel production Apparent finished steel usage Net imports 0.5 environment 30 0.3 0.4 0.5 28 ▪ Auto and appliance segments witnessed 26 24 26.1 27.4 26.1 26.1 26.8 0.1
Slide 9: Consolidated operational and financial performance
Consolidated (All figures are in Rs. Crores unless Consolidated Consolidated ex TSE and SEA1 operational stated otherwise) (Proforma) and financial 3QFY19 2QFY19 3QFY18 3QFY19 2QFY19 3QFY18 performance Production (mn tons)2 7.23 7.27 6.49 4.38 4.30 3.27 Deliveries (mn tons) 6.99 7.42 6.56 4.08 4.50
Slide 10: Consolidated Adjusted EBITDA movement
Consolidated ₹ Crores Adjusted 8758 EBITDA1 439 movement 488 528 78 7225 ▪ Selling results reflects sequentially lower steel realizations in India and SEA ▪ Cost impact reflects primarily higher operating cost at Standalone level ▪ Volume/mix impact due to lower deliveries Adjusted Selling Cost Volu
Slide 11: India: Steel production and sales volumes
Tata Steel Crude Steel Production Volume (mn tons) ▪ Quarterly production grew by 34%YoY to 4.38 mn tons India1: Steel with the acquisition and ramp-up of Tata Steel BSL production 4.38 4.31 and sales 3.27 ▪ Gained market share across the verticals volumes 3Q 2Q 3Q Automotive Branded & Retail FY19 F
Slide 12: Setting standards at multiple levels
Setting standards at Market leading branded portfolio Unparalleled Pan India reach* multiple levels Branded products sales contributes Network of ~12000 dealers and 24 41% of total sales stockyards (6 hubs + 18 spokes) Market leader in Auto Steel Most enriched product mix Auto steel sales grew 21%Yo
Slide 13: Branded Product, Retail & Solutions
Branded Product, Industrial Products, Auto Downstream Retail & Solutions Projects & Exports Branded Product, Retail Emerging Corporate Accounts (ECAs) Individual Home Builders & Solutions ▪ Focus on 20,000 plus ECAs in > 40 ▪ “Aashiyana” – leveraging early (BPRS) micro segments engagement through di
Slide 14: Key sustainability parameters
Specific Energy Intensity (Gcal/tcs) Specific Water Consumption (m3/tcs) Key Coke Rate (kg/tcs) 22% reduction since FY14 5% reduction since FY14 39% reduction since FY14 sustainability parameters 455 443 6.02 6.01 5.58 5.54 381 360 348 356 4.39 3.83 3.68 5.77 3.39 5.72 5.67 5.67 FY14 FY15 FY16 FY17
Slide 15: Engaging with neighbouring communities and improving their quality of life
Engaging with TSL Standalone – CSR Spend (Rs. crores) neighbouring ▪ Construction of boundary wall completed for Mid-day meal facility at 532 schools – covering 63,000 students communities and Education 232 ▪ Masti ki Pathshala, Sarjamda camp school was 212 improving their inaugurated – 59 children
Slide 16: Standalone financial performance
Standalone (All figures are in Rs. Crores unless stated otherwise) 3QFY19 2QFY19 3QFY18 financial Total revenue from operations 17,174 17,902 15,596 performance Raw material cost1 5,828 5,338 4,302 Change in inventories (928) (142) 429 EBITDA 4,560 6,113 4,647 Adjusted EBITDA2 4,872 5,859 4,710 Adju
Slide 17: Standalone Adjusted EBITDA movement
Standalone ₹ Crores EBITD1 5,859 164 movement 476 339 8 4,872 ▪ Selling results reflects sequentially lower steel realizations ▪ Costs increased primarily due to higher operating cost ▪ Volume/mix impact due to lower deliveries Adjusted Selling Cost Volume/Mix Others Adjusted EBITDA Result Changes E
Slide 18: Tata Steel BSL: performance and key updates
Tata Steel BSL: (All figures are in Rs. Crores unless stated otherwise) 3QFY19 2QFY19 performance Crude Steel production (mn tons) 1.04 1.05 and key updates Deliveries (mn tons) 0.92 1.14 Total revenue from operations 4,889 5,862 Raw material cost1 2,840 3,119 Change in inventories (417) 86 EBITDA2
Slide 19: Consolidated Debt movement
Consolidated Debt movement ₹ Crores 118,680 70 6,209 2,944 109,597 8,549 101,048 Gross debt has declined by Gross Debt Loans FX Impact Others Gross Debt Cash, Bank & Net Debt Sep'18 movement Dec'18 Current Dec'18 Rs.9,083 crores Investments 18
Slide 20: Business Outlook
Business Outlook ▪ Domestic demand to witness modest recovery as underlying domestic market remains strong Steel ▪ Steel demand is aided by segments like PEB, General Engineering, Railways, and Government Demand supported infrastructure; Auto sector is also slowly reviving ▪ Liquidity situation is i
Slide 21: Annexure I: Standalone QoQ Variations
Annexure – I: Rs Crores 3QFY19 2QFY19 Key Reasons Standalone Income from operations 16,691 17,580 Primarily due to lower volumes and softness in steel realisations QoQ Variations Other operating income 483 322 Higher exports benefits Raw materials consumed 5,332 4,769 Higher consumption of coal and
Slide 22: Annexure II: Consolidated QoQ Variations
Annexure – II: Rs Crores 3QFY19 2QFY19 Key Reasons Consolidated Income from operations 40,457 42,947 Lower revenue from India and SEA1 operations QoQ Variations Other operating income 763 597 Primarily at Standalone Raw materials consumed 13,804 14,043 Primarily on account of lower production at Eur
Slide 23: Annexure III: Tata Steel Europe performance and key updates
Annexure – III: (All figures are in Rs. Crores unless stated otherwise) 3QFY19 2QFY19 3QFY18 Tata Steel Europe Liquid Steel production (mn tons) 2.34 2.43 2.67 – performance Deliveries (mn tons) 2.35 2.27 2.44 and key updates Total revenue from operations 15,850 15,929 14,693 Raw material cost1 6,39
Slide 24: Annexure IV: Tata Steel SEA performance and key updates
Annexure – IV: (All figures are in Rs. Crores unless stated otherwise) 3QFY19 2QFY19 3QFY18 Tata Steel SEA Saleable Steel production (mn tons) 0.52 0.54 0.55 – performance Deliveries (mn tons) 0.57 0.65 0.62 and key Total revenue from operations 2,572 2,963 2,492 updates Raw material cost1 1,893 2,0
Slide 25: Contact
Contact Investor enquiries : Sandep Agrawal Tel: +91 22 6665 0530 Email: sandep.agrawal@tatasteel.com 24