NEWS - Earnings at Vedanta's zinc, ali businesses dip, copper mixed in FY2016

print Print this document.  Post this story to Facebook.
Vivian Teovivian.teo@fastmarkets.comJoint News Editor - Asia

Singapore 13/05/2016 - India’s Vedanta posted lower EBITDA for its aluminium and zinc businesses in its fiscal year ended March 2015, the company announced on Thursday.

EBITDA at its aluminium operations fell 74.3 percent to $106.7 million in fiscal 2016. This was due to lower LME prices, one-off charge of $36 million for prior periods’ renewable power obligations, though this was partially offset by deflation of raw materials, rupee depreciation and cost savings initiatives.

Vedanta is targeting aluminium production of around 1.2 million tonnes in its fiscal year ending March 2017, up 30 percent from record output of 923,000 tonnes in its previous fiscal year. Production in fiscal 2016 was up 5.2 percent from the previous year.

EBITDA of its overseas zinc operations fell 62.3 percent to $68.1 million due to lower zinc prices and production volumes.

Vedanta sees its refined and mined zinc production outside India at 170,000-190,000 tonnes in the current fiscal year, down 16-25 percent from output of 226,000 tonnes last year.

Vedanta's production of zinc outside of India had already fallen 27 percent in the last fiscal year because of the closure of its Lisheen mine in Ireland in November.

EBITDA at Vedanta’s Indian zinc operations fell 16.6 percent to $995 million last fiscal due to lower zinc, lead and silver prices, though they were partially offset by higher volumes, lower cost of production and rupee depreciation.

Vedanta's refined zinc production in India rose three percent to 759,000 tonnes while mined zinc metal in India was flat at 889,000 tonnes in fiscal 2016.

Earnings at its copper operations were mixed. Its Zambian copper operation’s EBITDA was at -$17.9 million in fiscal 2016, versus -$3.8 million in the previous year amid lower metal prices and increased volumes.

Its finished copper production at Zambia rose 7.7 percent to 182,000 tonnes last fiscal year.

EBITDA at its Indian copper business increased 19.8 percent to $336.6 million due to higher volumes and treatment and refining charges and lower cost of production.

Vedanta's copper cathode production in India hit a record 384,000 tonnes in fiscal 2016 after rising six percent from the previous year.

The company posted an overall EBITDA of $2.34 billion in fiscal 2016, down 37.5 percent.

Anil Agarwal, chairman of Vendata said the last fiscal was “a very tough year in the commodities space.”

“We are cautiously optimistic for 2017. Based on the visibility we have now, we believe a recovery may be emerging, led by zinc,” he said.



Fastmarkets.com
mailto:press@fastmarkets.com
8 Bouverie Street, London, EC4Y 8AX, UK
+44 (0)845 241 9949