Tata Steel rev­enues fall by a fifth as lock­down hits out­put

The Daily Telegraph - Business - - Business - By Alan Tovey

TATA STEEL has plunged deeper into the red as coro­n­avirus ham­mers de­mand for its prod­ucts and a tough lock­down in In­dia fur­ther threat­ens pro­duc­tion in the com­pany’s home na­tion.

Rev­enues at the busi­ness re­ported fell by a fifth to 337.7bn ru­pees (£3.6bn) in the quar­ter to the end of March com­pared to a year ear­lier, tak­ing it to a 15bn ru­pee pre-tax loss – three times the size of the loss for the pre­vi­ous quar­ter.

Over the full year, sales fell 11pc to 1.4 tril­lion ru­pees, re­sult­ing in a 2.3bn ru­pee loss, com­pared with a 159bn ru­pee profit the year be­fore.

The com­pany’s dive into the red was big­ger than an­a­lysts had been ex­pect­ing and came as Tata Steel reels from tough In­dian re­stric­tions which have se­verely lim­ited travel for the coun­try’s pop­u­la­tion of 1.3bn peo­ple. In­ter­na­tional off­shoots of the busi­ness – which in­clude the gi­ant steel­works at Port Tal­bot in South Wales – have also been hit by mea­sures to con­trol the pan­demic.

Com­pa­ny­wide de­liv­er­ies of steel dropped slightly on the pre­vi­ous year to 26.7m tons, al­though pro­duc­tion rose by 1.4m tons to 28.5m tons.

Post­ing the re­sults, the com­pany – part of the Tata con­glom­er­ate which also owns Jaguar Land Rover – said that lock­downs were only in force for a small part of the fi­nan­cial pe­riod cov­ered by the re­sults. This means far big­ger losses are likely to come.

The firm ex­pects a sharp fall in de­mand this year, fol­lowed by a ma­jor re­cov­ery in 2021.

Talks are be­ing held with the UK au­thor­i­ties about a po­ten­tial £500m loan to pro­tect Tata’s oper­a­tions across Bri­tain, which em­ploy about 8,500 staff.

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