Unlock Editor’s Digest for free
FT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.
Tata Steel’s UK operations nearly quadrupled in pre-tax losses last year after writing down the value of its traditional steelmaking operations in South Wales as part of the taxpayer’s move to greener forms of steelmaking. was recorded.
Britain’s biggest steelmaker, which owns the Port Talbot factory in Wales, made a pre-tax loss of £1.12bn in the 12 months to the end of March 2024, up from £279m a year earlier, the Companies said. New accounts filed with the House revealed this.
Tata has announced restructuring and impairment charges totaling £625 million related to its decision to close a coke oven and two carbon-intensive blast furnaces next year.
Revenues also fell in the year, falling 16% to £2.6bn due to lower steel prices and deliveries, the accounts showed.
The Indian-owned group announced in September the last of its two remaining blast furnaces after agreeing a £500m deal with the Labor government to help build electric furnaces that are neither carbon-intensive nor labour-intensive. blast furnace was closed. The deal included a £750m investment commitment from Tata and resulted in the loss of around 2,500 jobs.
Tata said in its accounts that after signing the deal in September, its UK operations will receive “at least £1 billion of equity” from its parent company and £500 million from the UK government to “contribute to operating costs”. said. project”.
Recommended
The UK steel industry has suffered in recent years from low steel prices and high operating costs, which have undermined the sector’s competitiveness. At the same time, pressure is growing to reduce carbon emissions as part of the government’s commitment to achieve net-zero emissions by 2050.
Chinese-owned British Steel currently operates the country’s only two remaining blast furnaces at its flagship facility in Scunthorpe, Lincolnshire, but is in talks with ministers about securing similar taxpayer support from the government. Discussions are continuing. No deal has been reached so far, raising concerns that the company could close the reactor without an agreement, putting thousands more jobs at risk.
The government has acknowledged that nationalizing the steelmaker would be a last resort if financing talks break down in the coming months. British Steel told the Financial Times this week that it was in “ongoing discussions” with the government about its decarbonization plans, adding that “no final decisions have yet been made.”