Troubled overseas arms widen net loss for Tata Chemicals

Tata Chemicals today reported that its consolidated net loss widened to Rs 1,226 crore in the March quarter on account of higher provisioning for impairment of overseas assets.
The company had posted a loss of Rs 188 crore a year earlier. On a standalone basis, Tata Chemicals' profit declined to Rs 81 crore from Rs 159.76 crore in the same quarter of the previous year.
On a consolidated basis, income from operations rose to Rs 3,695 crore during the quarter from Rs 3,328 crore.
Tata Chemicals had to make higher provisions for the impairment of fixed assets and goodwill at its Magadi plant in Kenya, amounting to Rs 924 crore, on account of higher energy costs, Managing Director R Mukundan said.

The company also announced the restructuring of its Kenya plant and said it has started consultations with the union and employees.
The company set aside Rs 180 crore towards diminution in the value of investment in its EPM mining venture in Canada, where it has a 25 per cent stake, in view of a significant decline in the share price compared with the carrying value of the investment.

It provisioned Rs 242 crore for restructuring costs related to the closure of its Winnington plant in Britain.
"What we have been doing in the last one-two years was to look at sustainability of operations and make them more robust. We went through restructuring four years ago, addressing the Netherlands operations where we shut down the plant as it was unviable.

"Last year, we shut down the Winnington plant in Britain. Now, we have taken a similar action in Kenya with respect to the pure ash plant which was clearly unviable," Mukundan said.