Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q1 FY2020 Earnings Presentation
25 slides from Tata Steel's earnings presentation, Aug 7, 2019
Slide 1: Results Presentation
Results Presentation Financial quarter ended June 30, 2019 August 07, 2019 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 ▪ Cross functional assessment, ▪ 5,000 employees regularly ▪ Tata Steel has been rated 4th best by TSE Process Safety team, to participating in ‘Outdoor among 20 global steel companies strengthen ‘Process Sa
Slide 4: Key strategic priorities
Key strategic ▪ Strong and ‘best in class’ assets – Jamshedpur, Current: 34 MTPA1 2025: 42 MTPA2 priorities Kalinganagar and Angul; globally competitive cost position ▪ Target to increase capacity to 30 million tons per annum Strengthening 29% (MTPA) by 2025 43% India ▪ Strategic acquisitions compri
Slide 5: Key performance highlights and updates
Key performance highlights and updates 1QFY20 – key Strengthening India Financial Health performance indicator operations ▪ Indian operations contributed ▪ Kalinganagar 5MTPA Phase II ▪ Calibrated debt drawdown for 63% out of consolidated expansion is underway; organic expansion; enhanced deliveries
Slide 6: Engaging with neighbouring communities and improving their life quality
Engaging with ▪ 1000 Schools Projects –1,372 schools and 49,032 children TSL Standalone – CSR Spend (Rs. crores) neighbouring supported in Odisha and Jharkhand 315 communities Education ▪ 30 Model schools – 20 schools completed, 17 handed over 232 and improving ▪ Tata Steel Scholars program – 59 mer
Slide 7: Global macro and business environment
World GDP growth (% YoY) and China crude steel production and Global macro ▪ Rising uncertainty around political and trade global manufacturing PMI domestic consumption1 (mn tons) and business conflicts continued to weigh on global 56 JPMorgan Global Manufacturing PMI World GDP Growth (RHS) 4.5 Prod
Slide 8: India macro and business environment
India macro ▪ Overall economic activities were and business Key sectors growth (% Change, YoY) Bank credit growth (YoY%, 3MMA) weaker as liquidity issues negatively environment impacted domestic consumption and 1QFY19 2QFY19 3QFY19 4QFY19 1QFY20 25% Infrastructure Industry ex infra 16.5% business se
Slide 9: Europe macro and business environment
Europe macro EU - key steel consuming and business ▪ Euro zone grew modestly at Eurozone GDP (%, YoY) sectors (%YoY) 1.1%YoY in 1QFY20 and 15% Construction environment expanded marginally on QoQ 3.0 Automotive Mechanical Engineering 2.6 10% basis 2.2 5% ▪ No-deal Brexit along with 1.8 0% unsettling
Slide 10: Consolidated operational and financial performance
Consolidated (All figures are in Rs. Crores unless stated otherwise) 1QFY20 4QFY19 1QFY19 operational Production (mn tons)1 7.15 7.21 6.45 and financial Deliveries (mn tons) 6.34 7.52 6.02 performance Total revenue from operations 35,947 42,424 35,494 Raw material cost2 16,127 15,744 13,841 Change i
Slide 11: Consolidated Adjusted EBITDA movement
Consolidated Adjusted ₹ Crores ▪ Selling results reflects sequentially EBITDA1 lower steel prices at Tata Steel 7814 287 Europe movement 229 756 ▪ Costs impact were primarily due to higher costs including raw 1012 5530 materials at Tata Steel Europe ▪ Volume/mix impact due to lower deliveries across
Slide 12: Steel India: Production and delivery volumes
Tata Steel Crude Steel Production Volume (mn tons) ▪ Quarterly domestic sales volume jumped by 16%YoY to 3.66 mn tons India1: compared to 7% YoY market growth Production 4.50 4.48 ▪ Slowdown in Automotive sector countered by higher sales in other and delivery 3.64 segments volumes ▪ Industrial Produ
Slide 13: Tata Steel India: Setting standards at multiple levels
Tata Steel India1: Setting Market leading branded portfolio Unparalleled Pan India reach standards at Branded products sales contributes Network of 129 distributors and multiple levels 44% of total sales ~12000 dealers Market leader in Auto Steel Most enriched product mix First choice for new car la
Slide 14: Tata Steel India: Creating sustainable value
Tata Steel Key business segments’ highlights India1: Automotive & ✓ Protected ‘share of business’ in a slowing market Creating ✓ Tata Steel BSL awarded “Certificate Of Appreciation” by Maruti Suzuki India for Superior Special performance in “Raw Material Localization” products sustainable ✓ Multiple
Slide 15: Tata Steel Standalone: Financial performance
Tata Steel (All figures are in Rs. Crores unless stated otherwise) 1QFY20 4QFY19 1QFY19 Standalone: Total revenue from operations 16,091 19,130 16,405 Financial performance Raw material cost1 5,272 5,534 4,947 Change in inventories (544) 1,170 (655) EBITDA2 4,098 4,953 5,118 Adjusted EBITDA3 4,277 4
Slide 16: Tata Steel Standalone: EBITDA movement
Tata Steel ₹ Crores Standalone: EBITDA1 122 movement 4,875 58 ▪ Selling results reflects sequentially better steel realizations 378 284 4,277 ▪ Cost impact is primarily due to absorptions of overheads on lower volumes ▪ Volume/mix impact due to lower deliveries ▪ Others include lower export credit b
Slide 17: 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 5.54 443 434 6.49 sustainability 6.31 6.01 399 4.75 5.77 381 5.68 5.67 5.67 5.67 366 4.39 364 360 4.27 352 348 4.15 parameters 3.83 3.68 3.46 3.27 FY15 FY16 FY17 FY18 FY19 1QFY
Slide 18: Tata Steel BSL: Consolidated performance and key updates
Tata Steel BSL: (All figures are in Rs. Crores unless stated otherwise) 1QFY20 4QFY19 1QFY191 Consolidated Crude Steel production (mn tons) 1.12 1.03 0.47 performance Deliveries (mn tons) 0.86 1.14 0.38 and key updates Total revenue from operations 4,333 5,517 2,108 Raw material cost2 2,905 2,752 1,
Slide 19: Tata Sponge Iron: Consolidated performance and key updates
Tata Sponge Iron: (All figures are in Rs. Crores unless stated otherwise) 1QFY20 4QFY19 1QFY19 Consolidated Production (‘000 tons) performance - Crude Steel 121 - - - Sponge 172 115 117 and key updates Deliveries (‘000 tons) - Crude Steel 93 - - - Sponge 135 118 115 Total revenue from operations 705
Slide 20: Tata Steel Europe: performance and key updates
Tata Steel Europe: (All figures are in Rs. Crores unless stated otherwise) 1QFY20 4QFY19 1QFY19 performance Liquid Steel production (mn tons) 2.65 2.73 2.81 and key updates Deliveries (mn tons) 2.26 2.57 2.45 Total revenue from operations 14,495 16,568 16,429 Raw material cost1 7332 7,268 7,585 Chan
Slide 21: Consolidated Debt movement
Consolidated Debt movement Gross Debt Sept'18 118,680 Offshore Debt reduction 10,167 SEA Debt De- 682 consolidation Loan movement in India 2,224 FX Impact 5,007 Others 216 Gross Debt Mar'19 100,816 Recoginition of lease obligations as per 2,845 IndAS 116 Note: Consolidated numbers doesn’t include Na
Slide 22: Business Outlook
Business ▪ Global steel demand is expected to remain weak due to broader economic weakness and trade Outlook barriers among the global economies Steel ▪ India steel demand is expected to improve in 2HFY20 with the end of monsoon, increase in the Demand government spending and improvement in liquidit
Slide 23: Annexure – I: Standalone QoQ Variations
Annexure – I: Rs Crores 1QFY20 4QFY19 Key Reasons Standalone Income from operations 15,813 18,498 Lower in line with lower deliveries and lower non steel revenues QoQ Variations Other operating income 279 632 Primarily due to lower export related benefits Lower consumption in line with lower product
Slide 24: Annexure – II: Consolidated QoQ Variations
Rs Crores 1QFY20 4QFY19 Key Reasons Annexure – II: Income from operations 35,382 41,186 Primarily due to lower volumes across geographies Consolidated Other operating income 565 1,237 Primarily at Tata Steel Standalone and Tata Steel BSL QoQ Variations Higher iron ore cost at Tata Steel Europe; high
Slide 25: Contact
Contact Investor enquiries : Sandep Agrawal Tel: +91 22 6665 0530 Email: sandep.agrawal@tatasteel.com 25