Tata Steel reported a consolidated net loss of Rs 6,511 crore in the second quarter of 2023-24 as the company was hit by impairment charges and shrinking margins in its operations in Europe.

The company had made a net profit of Rs 1,297 crore in the same quarter last year.

Tata Steel reported a consolidated total revenue from operations of Rs 55,681 crore as against Rs 59,877 crore reported in the year-ago period.

“India business generated a higher margin of around 20 per cent and EBITDA stood at Rs 6,841 crore. In Europe, margins moderated especially in UK business while Netherlands business was broadly stable on a quarter-on-quarter (QoQ basis). Revenue per ton was lower in both geographies. However, improved costs in the Netherlands led to broadly similar margins,” Koushik Chatterjee, Executive Director and Chief Financial Officer, said in a statement.

The company said that it has assessed the potential impact of the Electric Arc Furnace route based decarbonisation project and restructuring in Tata Steel UK. Subsequently, it has undertaken an impairment charge of Rs 12,560 crore in standalone financial statements and Rs 2,746 crore in consolidated financial statements.

Tata Steel has also taken a charge towards restructuring and other provisions of Rs 3,612 crore in consolidated financial statements.

In September, the UK government agreed to give a grant of £500 million to help Tata Steel decarbonise its Port Talbot project. Tata Steel will have to invest the balance in the total capital cost of £1.25 billion.

Tata Steel Europe (TSE) recorded revenues of Rs 18,846.7 crore in the quarter as against Rs 21,558.8 crore a year ago.

In the company’s India business, revenue was Rs 33,922 crore down from Rs 34,642.8 crore a year earlier. EBITDA was Rs 6,841 crore.

Crude steel production in Q2FY24 was around 5 million tons and was broadly similar on a QoQ basis but up 5 per cent on a YoY basis. Deliveries stood at 4.82 million tons, marginally higher from the previous quarter.

“Tata Steel India delivered steady performance, with crude steel production of around 5 million tons. Domestic deliveries were up 6 per cent YoY, despite renewed volatility and seasonal factors during the quarter. Among the key segments, Auto and Branded Products & Retail had best ever 2Q sales,” the company CEO and MD TV Narendran said in a statement