British Steel back into profit after Tata sale

British Steel’s Scunthorpe steelworks, one of only two left in Britain, is back in profit just three months after it was sold from Indian firm Tata Steel.

Roland Junck, executive chairman of British Steel, said: “It has gone from making several millions of pounds of losses a month to positive financial results month-on-month. We are exactly on track so far and expect to meet our financial targets in this fiscal year.”

After controlling costs and rebuilding customer relationships, the company is now targeting profits of £120 million a year, with a 10% profit margin on annual revenues of £1.2 billion. British Steel also plans to invest £50 million into modernising its facilities, with staff were asked to take a 3% pay cut to instigate the plans, which they agreed.

Mr Junck added: “The transformation of our business will make sure we maintain the pace of growth and move forward as an outward-looking profit-making business. But while our future remains firmly in our hands, the UK steel industry still faces many challenges.

“That is why we are pleased to remain in constructive dialogue with the government about the strategy needed to support British Steel and ensure that it is operating on a level playing field. It goes without saying that any strategy must be long term and cross all political divides if it is to achieve the goals we share.”

The Scunthorpe steelworks was rebranded as British Steel in June 2016 when investment firm Greybull Capital bought Tata’s long products business. Its customers include Network Rail, Toyota, and Transport for London.

British Steel www.britishsteel.co.uk