TATA Steel last night defended its decision to axe 390 North-East jobs just days before announcing a £1.5bn increase in profits.

The Indian firm, which employs 1,800 workers in the region, announced on Friday that is proposing to make 300 workers redundant in its Long Products business on Teesside and 90 redundant from two of its three steel tube mills in Hartlepool.

Yesterday the Mumbai based firm, which last year recorded a loss of £277m, said it made profit after tax of £1.2bn in the year to March 31.

It added that its European operations performance improved dramatically during the year, with earnings of £579m, up by £765m on the previous 12 months.

However the sale of Teesside Cast Products, near Redcar, to Thai firm Sahaviriya Steel Industries (SSI), in March, accounted for £291m of that.

And despite the profit figures the firm believed that each part of the steel business had to be self sustainable, with the Long Products division having lost money for more than two years.

A Tata Steel spokesman said: "The Long Products business has been making losses since the financial crisis.

"That is an unsustainable situation that has to be addressed and what the company hopes to do through that action is ensure that business has a secure and sustainable future."

Tata Steel Europe's chief executive Dr Karl-Ulrich Kohler said: "The measures announced last week in Long Products show our determination to complete the turnaround task and create a very competitive business that delivers robust performance in all market conditions."

Jimmy Skivington, regional organiser with the GMB, one of several unions representing Tees Valley steelworkers, was disappointed with the timing of the two announcements.

He said: "We are glad that they haven't made any closures and we are happy to work with them but the timing of it, 1,500 redundancies one week then £1bn profit announced the next week, it doesn't sit very well at all."

Redcar Liberal Democrat MP Ian Swales said he was disappointed with the potential redundancies but added: "I know from having been finance director of a global business myself you look at each part of the business separately and you have to address issues of investment and cutbacks to each part of the business.

"Sadly the Long Products division has been going through a bad time, but Tata is an international company making money all over the world."

This week Mr Swales met with Employment Minister Chris Grayling to discuss the Government's response to the job cuts.

Michael Leahy, general secretary of the Community union, said the massive turnaround in Tata Steels fortunes was in no small part due to the workforce.

He said: "Tata must now repay this in kind by guaranteeing all its UK employees that they have a secure future and by doing everything it can to alleviate the consequences of last week's job losses."

The cuts at the Long Products division, which includes the Teesside Beam Mill, in Lackenby, and its Special Profiles division, in Skinningrove, form part of proposals which would also see 1,200 steelworkers in Scunthorpe lose their jobs.

Tata is planning to invest £400m in the Long Products business over the next five years, but said that while investment in its assets was needed to ensure it could take advantage of a future upturn in work, slimming down the division was also necessary to give it a viable future.