Arcelor Mittal : The world's largest steel maker, said on Thursday it will shut down its blast furnace number six at Seraing in Belgium until at least the end of February, Belgian media reported.

Public broadcaster RTBF said the move, which comes only eight months after the furnace was reopened, was due to the financial crisis and a decrease in demand for steel.

A spokesman for ArcelorMittal in London said he was unable to comment immediately on the report, which said ArcelorMittal had already taken similar steps at seven units in Europe.

RTBF said the firm preferred to decrease production in the face of a fall in the global demand for steel rather than reduce prices. It said the closure of the blast furnace would lead to layoffs, but not dismissals.

ArcelorMittal said earlier it was reviewing its expansion programme due to the economic downturn.

"ArcelorMittal's growth strategy remains unchanged," a spokesman said in a statement, adding, "However, the current market situation is prompting us to check the order of priority to be assigned to our different growth projects. We are currently reassessing these priorities."

Further details could follow when ArcelorMittal reports third-quarter results on Nov. 5.

Thursday's Financial Times reported that the company's eight-year $35 billion expansion plan was under review, including its $20 billion project for two new plants in India, on which work could be put back to 2012-2015.

The ArcelorMittal spokesman declined to quantify the size of the company's expansion plans.

Chairman Lakshmi Mittal said in September that the cost of the India project was running beyond $20 billion because of delays in securing regulatory approvals.

ArcelorMittal weathered the initial phase of the financial crisis as steel demand and prices were strong, but the company's shares have dropped 72 percent since their peak on June 6 as the commodity boom ended.

The company has already announced a 15 percent cut in European output as its main customers — the construction and the car industries — see sales slip.

Trade union representatives in France said management at the Fos-sur-Mer plant had told workers that it would reduce output and asked workers to take vacations of up to 16 days from November 1 and December 31. One furnace will cease work until the end of January, said Alain Nougue, a delegate from the CGT.

Another steel plant at Florange in eastern France would also stop output for the month of December, Jean-Marc Verin of the CFDT union said.

In Belgium, local press said workers had been told that ArcelorMittal plants at Genk and Chatelet would cease production for four weeks at the end of the year while facilities at Seraing and Ghent would decrease output levels.

French newspaper Le Figaro quoted French trade union officials as saying 13 European plants would temporarily stop work — including three in Germany. ArcelorMittal refused to comment on the reports.

European steelmakers warned Monday they are facing a difficult market climate as demand dries up and rival steel imports from China rise.

The Eurofer association which counts ArcelorMittal as a member said the market was oversupplied and might only rebound at the end of 2009.

Business and consumer confidence in the 15-nation area slipped to a 15-year low on Thursday as companies worried about falling sales and said they expected to employ fewer people.

The government is unlikely to meet the 3.1 per cent fiscal deficit target set for this fiscal due to excess borrowings to meet contingencies, Planning Commission deputy chairman Montek Singh Ahluwalia said here Thursday.

"Fiscal deficit this year is likely to be more than the budgeted 3.1 per cent (Rs.1.3 trillion) due to over-exposure in terms of borrowings. In view of the exceptional circumstances and global factors, the government had to also raise oil bonds and fertiliser bonds, which are considered off-budget," Ahluwalia told reporters on the sidelines of a function.

As per the Fiscal Responsibility and Budget Management (FRBM) Act 2003, the fiscal deficit is required to be reduced to 3 per cent of the GDP (gross domestic product) by 2008-09 - at the rate of 0.3 per cent of GDP every year from 2004-05.

"The FRBM Act is effective and adoptable under normal circumstances. To make it a rigid prescription will be a complete misreading of the Act," Ahluwalia said.

Fiscal deficit is a measure of borrowings by the government in a financial year. In budgetary arithmetic, fiscal deficit is the total expenditure minus the sum of revenue receipts, recoveries of loans and other receipts such as proceeds from disinvestment.

The government raises resources to fund its expenditure through tax collections and borrowings from the Reserve Bank of India (RBI), from the public by floating bonds, financial institutions, banks and foreign institutions.

 

"Even in developed countries (the US and Europe), fiscal deficits are set to go off targets this year following re-capitalisation of banks and infusion of billions of dollars and euros in their troubled financial systems," Ahluwalia asserted.

In the wake of dramatic rise in commodity and fuel prices, followed by global slowdown and financial meltdown, economies of the developing and developed countries are facing their worst-ever crisis in recent memory.

"In India, however, we have been taking proactive fiscal and monetary measures to minimise the impact of these global factors on our resilient economy. The centre has also insulated the states to a large extent by not passing off the burden of steep rise in fuel and fertiliser subsidies," Ahluwalia said.

Ahluwalia was in the tech city to receive a report on "technology enabled transformation of power distribution", prepared by IT bellwether Infosys Technologies in association with the Centre for Study of Science, Technology and Policy (CSTEP), Bangalore, a non-profit research organisation.

Revenue earned for the quarter rose 43.3% to Rs 5,604.9 million from Rs 3,911 million in the same quarter, last year.

During the quarter, the company reported earnings of Rs 2.68 a share, registering a growth of 25.23% over same period last year.

Operating profit during the latest quarter increased 57.2% from a year-ago to Rs 1,333.1 million.

 

Nitin S. Kasliwal, vice chairman and managing director of SKNL said, ``The company is happy to announce a healthy financial and operating performance in a market characterized by varying and challenging conditions. Revenues for the quarter have increased by over 43% over the corresponding quarter last year.``

``During the quarter, the company has also been successful in expanding the reach of its products across segments and all the brands under the SKNL umbrella have increased their retail presence. The company would maintain its growth momentum and we are confident that we will show resilience,`` he added.

Net sales for the quarter rose 9.35% to Rs 1,095.00 million, while total income for the quarter rose 6.75% to Rs 1,256.90 million, when compared with the prior year period.

The company posted earnings of Rs 0.64 a share during the quarter, registering 40.74% decline over prior year period.

 

During the quarter, Interest cost decreased 15.67% to Rs 63.50 million while depreciation cost rose 37.21% to Rs 120.20 million over previous year period.

JK Tyre and Industries swung to loss for the quarter ended September 2008. During the quarter, the company reported loss of Rs 323.70 million compared with a profit of Rs 243.90 million in the same quarter last year.

Net sales for the quarter rose 27.10% to Rs 8,744.80 million, while total income for the quarter rose 26.73% to Rs 8,751.40 million, when compared with the prior year period.

The company posted earnings of Rs 10.05 a share during the quarter, registering 26.89% growth over prior year period.

During the quarter, Interest cost increased 6.51% to Rs 260.00 million while depreciation cost fell 2.18% to Rs 188.20 million over previous year period.

The company has changed its accounting year from October-September to April-March. Accordingly, the current financial year shall be for a period of eighteen months i.e. from Oct. 01, 2007 to Mar. 31, 2009.

Greaves Cotton : Announced a drop in its standalone net profit for the quarter ended September 2008. During the quarter, the profit of the company declined 13.24% to Rs 206.40 million from Rs 237.90 million in the same quarter, last year.

Net sales for the quarter rose 12.59% to Rs 3,497.20 million, while total income for the quarter rose 12.19% to Rs 3,512.20 million, when compared with the prior year period.

Maharashtra Seamless :  Announced a small rise in its standalone net profit for the quarter ended September 2008. During the quarter, the profit of the company rose 9.89% to Rs 639.10 million from Rs 581.60 million in the same quarter, last year.

Net sales for the quarter surged 56.16% to Rs 6,021.70 million, while total income for the quarter jumped 57.96% to Rs 6,183.10 million, when compared with the prior year period.

The company reported earnings of Rs 9.06 a share during the quarter, registering 9.95% growth over previous year period.

 

During the quarter, the operating margin of the company declined 691.31 basis points to 14.71% compared with the previous year period of 21.62%.

Mahindra & Mahindra (M&M):  Announced a small decline in its consolidated net profit by 4.90% to Rs 3,733.30 million for the quarter ended Sep. 30, 2008 from Rs 3,925.80 million for the quarter ended Sep. 30, 2007. Gross Revenue and other Income stood at Rs 77,414.20 million for the quarter ended Sep. 30, 2008 where as the same was at Rs 65,025.50 million for the quarter ended Sep. 30, 2007, a rise of 19.05%.The company reported a steep drop in its standalone net profit for the quarter ended September 2008. During the quarter, the profit of the company declined 20.69% to Rs 2,267.75 million from Rs 2,859.47 million in the same quarter, last year. Net sales for the quarter rose 11.97% to Rs 31,379.57 million, while total income for the quarter rose 13.26% to Rs 32,522.66 million, when compared with the prior year period. The company posted earnings of Rs 9.44 a share during the quarter, registering 21.33% decline over previous year period. During the quarter, the operating margin of the company fell by 777.73 basis points to 5.90% compared with the previous year period. Interest cost increased 84.91% to Rs 152.50 million while depreciation cost rose 10.77% to Rs 638.80 million over previous year period.

Mahindra & Mahindra is a well diversified company having its presence in the auto sector, auto components, farm equipment, infrastructure development, telecom and software and trade and financial services. It is a leading name in the general-purpose utility vehicles market in India. The scheme of amalgamation of Mahindra Holdings & Finance (MHFL), a wholly owned subsidiary of the company, with the company was sanctioned by the High Court of Bombay on July 18, 2008. The scheme is effective Aug. 11, 2008 and is operative from the appointed date of Feb. 01, 2008. The accounting of this amalgamation was done as per the scheme approved by the High Court of Bombay. On account of the merger the figures for the quarter and half year of the current year are not comparable with that of the previous year, the company said.

JK CEMENT : JK Cement, the largest cement producer in India, disclosed a substantial drop in its standalone net profit for the second quarter ended September 2008. During the quarter, the profit of the company declined 75.57% to Rs 177.63 million from Rs 727 million in the same quarter, last year. Net sales for the quarter rose marginally 1.46% to Rs 3,616.16 million, while total income for the quarter rose marginally 0.90% to Rs 3,616.16 million, when compared with the prior year period. The company reported earnings of Rs 2.54 a share during the quarter, registering 75.58% decline over prior year period.

During the quarter, the operating margin of the company dropped to 14.22% compared with 28.17% in the previous year period. Interest cost increased 17.88% to Rs 101.38 million while depreciation cost rose 33.55% to Rs 133.55 million over previous year period.

In the month of September 2008, the company has commissioned a 7.5 M.W. Thermal Power Plant at Gotan and a 0.47 million ton Grey Cement Plant at Gotan.