Tata Steel’s Port Talbot plant swings back to modest profit
Tata Steel’s Port Talbot plant swung back to a modest profit over the summer.
This is a significant turnaround for the plant, which was reportedly posting a £1m a day loss at the height of the steel crisis when Tata was considering selling off its UK assets.
“By June a break-even or beyond figure was being refleced in Port Talbort’s profits,” a source close to the plant told CityAM
It is understood that the plant posted profits of £5m in June. Union sources also confirmed there had been an uptick in yields at the steelmaking centre, though they were not able to specify an exact figure.
Read more: UK steel industry under pressure as global trade war heats up
“We know that things are looking up at the plant, so news like that is not a surprise to us at this point,” a trade union source told CityAM “This is the result partly of the management turnaround plan and the steelworkers at the plant, who have been working harder than ever.”
The tumble in the pound since the EU referendum and a rise in global steel prices primarily drove the increase in profits at Port Talbot, though workforce performance at the plant has also been on the up.
Read more: China warns EU steel tariffs will hurt the bloc's manufacturers
At this stage, the relative rise in numbers would still not be large enough to permanently turn around the plant’s operations, which could need monthly profits of as much as £20m to be sustainable.
Reports have indicated a rescue deal for Port Talbot and the other UK steel operations could be finalised as early as next quarter.