Published: Tue, May 16, 2017
Money | By Armando Alvarado

Tata Steel Reports Unexpected 1Q Net Loss

Tata Steel Reports Unexpected 1Q Net Loss

Edelweiss Securities expects the company to report a consolidated core profit of Rs 442 crore compared with a loss of Rs 1,443 crore in the same quarter a year ago.

The strong fourth quarter helped the business generate earnings of £526 million for the last 12 months, compared to a £52 million loss the year before, with stronger market conditions and tailwinds from the fall in the value of sterling, which makes British exports cheaper overseas.

The consolidated revenue from operations increased to Rs 35,304.89 crore in January-March 2017, from Rs 27,071.26 crore in the same quarter of FY2015-16, Tata Steel said in a regulatory filing.

Consolidated revenue for the quarter rose about 30 percent from a year earlier to 350.05 billion rupees. All employees in the United Kingdom can now opt into a defined contribution scheme, he said.

According to the filing, Tata Steel created "restructuring and other provisions" of Rs 3,613 crore mainly due to curtailment charges related to closure of the BSPS to future accruals.

Indian-owned Tata Steel employs 11,000 people in Britain.

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As well as the Wednesfield Steelpark, Tata Steel employs around another 100 at Walsall and Brierley Hill.

The closure also serves as the first step in the restructuring of the United Kingdom pensions. It is subject to formal approval by The Pensions Regulator, but Tata said it expected to get approval shortly.

Tata Steel UK and the British Steel Pension Scheme trustees have agreed in principle on the key terms of a regulated apportionment arrangement, the company said in the statement.

The PPF is a lifeboat for pension schemes in Britain that run into trouble. For most Scheme members, these modified benefits are expected tobe of greater value than those they would otherwise receive by transferring into the PPF.

With benefit cuts in place, the new scheme will pose less of a risk to the company, Tata said.

This is published unedited from the PTI feed.

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