Steel Authority of India (SAIL) Q4 99/00 earnings summary

Executive summary

• FY1999-2000 sales turnover rose 8.4% YoY to Rs.16,250.16 crore; net loss widened to Rs.1,720.02 crore from Rs.1,573.66 crore.

• A Government-approved restructuring plan took effect from 1 April 1999; related accounting adjustments reduced the reported loss by Rs.756.80 crore.

Financial highlights

• Sales of saleable steel reached 9.71 million tonnes, up from 8.97 million tonnes; exports rose 81% to 0.89 million tonnes.

• Operating profit before depreciation, interest and tax was Rs.1,202 crore; interest was Rs.1,788.79 crore and depreciation Rs.1,132.79 crore.

• Net loss after tax was Rs.1,720.02 crore versus Rs.1,573.66 crore in FY1998-99; no dividend was recommended.

• Cost-reduction initiatives generated Rs.713 crore in savings, partly offsetting market pressures and higher input costs.

Outlook and guidance

• Domestic steel market prices improved 3% while export realisations declined; second-half FY2000 showed signs of revival in volumes and realisations.

• FY2000-01 purchasing initiatives targeted savings of 8–10% across selected commodities and ~5% across four additional commodities.

• Sinter Plant 3 at Bhilai was expected to be completed by March 2001; divestment advisers were appointed and expressions of interest solicited for identified units.