Tata Steel Expects Higher Profit at European Unit

NEW DELHI – Tata Steel Ltd. expects operating profit at its European unit to rise by two-thirds of its current level to $100 a metric ton over the next three years as it focuses on more value-added products and controlling costs, its managing director said.

Tata Steel Europe generates earnings of $60 per ton before interest, tax, depreciation and amortization at present and the expectation is based on "assumptions about the prices and availability of raw materials and market conditions in Europe," Hemant Nerurkar told a press conference late Tuesday.

Mr. Nerurkar said the unit, formerly called Corus, would produce around 15 million to 16 million tons of crude steel in the financial year which began on April 1, up from 14.8 million tons last year.

Tata Steel Europe turned around its performance during the last few quarters by cutting costs. It sold its Teesside plant in the U.K. and reduced staff at some other facilities. The company is banking on a gradual recovery in demand for steel in northern Europe and the U.K. to drive its production and revenue higher over the next few years.

Mr. Nerurkar said he doesn't expect any reduction in steel prices in India over the next three months due to high raw material prices.

Tata Steel, which has its own iron-ore mines in India, imports a large part of the coking coal it requires.

Mr. Nerurkar said the company will import coking coal at around $280-$290 a ton for the July-September quarter, unchanged from the current quarter. "We had expected coking coal prices to come down for the second quarter [of the fiscal year], but that didn't happen."

Mr. Nerurkar added that India's steel demand is expected to keep growing by 10.4%-10.5% a year, mainly due to consumption by the construction industry as both the private sector and the government makes large investments in infrastructure development.

But there could be some slow down in steel demand from automobile and consumer-durables companies as higher interest rates in India have made loans for buying cars and appliances more expensive, he added.

Write to Prasenjit Bhattacharya at prasenjit.bhattacharya@dowjones.com

Nissan CEO Ghosn Is Highest-Paid Foreign Executive In Japan

YOKOHAMA, Japan (Dow Jones)--Nissan Motor Co.'s (7201.TO) Chief Executive Carlos Ghosn held on to his place as the highest-paid foreign executive at a listed Japanese company in the last fiscal year with Y982 million ($12.1 million) in total compensation, a rise of 10% from the previous year.

The head of Japan's second-biggest car maker by volume told shareholders at an annual meeting Wednesday that his pay rise in the fiscal year ended March 2011 came after the company boosted net profit by more than seven-fold and logged record global vehicle sales during the period.

Ghosn's most recent pay package compared with the Y891 million in total remuneration that he received in the previous fiscal year, when he was also the country's highest paid foreign executive, and eclipsed the Y863 million paid to Sony Corp. (6758.TO) Chief Executive Howard Stringer.

At the meeting Wednesday, some Nissan shareholders questioned the size of Ghosn's pay packet, which was more than seven times larger than those of his counterparts at other major Japanese car makers, despite his explanation that his pay was based on global, rather than Japanese standards.

Nissan determines its executive pay based on data collected by New York-based human-resources-services firm Towers Watson, the CEO said

"This is a very transparent process," said Ghosn, who also serves as CEO of Nissan's French partner Renault SA. "We want to be confident, and this is done very seriously."

Ghosn's salary was below the $15.3 million average compensation for comparable auto industry CEOs and also below the $14.3 million average for comparable CEOs of other multinational industrial companies, Nissan said.

Japanese senior executives tend to earn less than their counterparts at other multinational companies: Toyota Motor Corp. (7203.TO), Japan's biggest car maker by volume, said last week that President Akio Toyoda earned Y136 million ($1.7 million)in the last fiscal year, while Takanobu Ito, Chief Executive and President at Japan's third biggest car maker Honda Motor Co. (7267.TO) received Y130 million ($1.6 million).

By comparison, General Motors Co. Chairman and Chief Executive Daniel Akerson received compensation worth $2.5 million last year after he became CEO on Sept. 1, while Ford Motor Co. CEO Alan Mulally made more than $26.5 million in salary and stock options last year.

Ghosn said six other directors at Nissan earned Y100 million or more in the last fiscal year. Under new rules introduced last year, the Financial Services Agency requires that publicly traded companies disclose the annual compensation of executives receiving Y100 million or more.

The details will be made available in a filing to the regulatory authorities Thursday, Ghosn said.

Nissan on Monday outlined an ambitious growth strategy for the next six years, in which it aims to raise its profit margin to 8% from 6.1% in the last fiscal year, and targets a global market share of 8% from 5.8% in the last fiscal year.

-By Yoshio Takahashi, Dow Jones Newswires; 813-6269-2791; yoshio.takahashi@dowjones.com