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JSW Steel reported a net profit of ₹1,595 crore in the September quarter against net loss of ₹582 crore logged in the June quarter. Ramp up of production and lower cost led to better realisations during the quarter.
Sales were up ₹18,662 crore against ₹11,545 crore registered in the June quarter when demand was washed out due to the lockdown. The average capacity utilisation increased to 86 per cent from 66 per cent in the June quarter.
However, on a year-on-year basis, JSW Steel net profit was down 37 per cent compared to ₹2,536 crore recorded in the same period last year, on the back of higher tax outgo.
The company’s net profit in last September quarter was boosted by a tax write-back of ₹1,848 crore while in this quarter it logged a tax outgo of ₹910 crore.
Gross revenue from sales was 12 per cent higher₹18,662 crore (₹16,737 crore) while overall expenses fell marginally to ₹16,958 crore (₹17,025 crore) year-on-year in September quarter.
Domestic demand revival
Revival in domestic demand led to exports falling 28 per cent against 57 per cent in June quarter. Realisation in the domestic markets are higher than exports.
The operating costs were down due to lower imported coal prices, savings in procurement costs and fixed overheads. However, this benefit in cost was partially offset by increase in the iron ore prices, said the company.
While the company has shut the pipe mill for maintenance work, it produced 54,317 tonnes of plates at a capacity utilisation of 22 per cent during the quarter and reported EBITDA of $17 million. JSW Steel Ohio USA Inc reported an EBITDA loss of $10.52 million as it remained shut for blast furnace upgradation. The company’s plant in Italy reported an EBITDA loss of €13 million.
With the improvement in the availability of workforce at all locations, the expansion projects have gained momentum, the company said.
It has started trial production at 1.2 million tonnes per annum wire rod mill at Vijayanagar in Karnataka and construction of 8 mtpa pellet plant is expected to be commissioned in December quarter.
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