Tata Steel Warns Of Uncertainty In Its UK Business

Tata Steel has warned that the finances of its UK business face "material uncertainty" given market conditions and the level of government support, Nick Edser and Peter Gillibrand reported for BBC News.

Photo Insert: The UK business of India's Tata Steel employs about 8,000 people, with half at the Port Talbot steelworks in Wales.

Tata said a stress test of its European arm to assess the impact of a downturn had flagged concerns for the UK unit. However, Tata Steel UK said it expected trading to pick up later this year.

The Department for Business said the government is providing support to protect the steel industry from "unfair trade and energy costs."

The UK business of India's Tata Steel employs about 8,000 people, with half at the Port Talbot steelworks in Wales.

In results published last week, Tata said that earnings at Tata Steel Europe - which includes the UK business - fell by more than 60% in the year to March 31. It added it had carried out tests to assess the potential impact of an economic downturn in Europe, given factors such as higher inflation and interest rates.

These tests found the outlook for the UK business would be "adversely impacted," but it added it was continuing to "implement various measures aimed at improving its business performance and conserving cash."

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