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Vedanta Resources makes solid third quarter progress
Vedanta Resources posted its production and financial results for its third quarter on Friday, with refined zinc-lead metal production at Zinc India up 7% quarter-on-quarter at 245kt.
The FTSE 250 company said the operation was on track for a ramp up to 1.2mt by the 2020 financial year.
At Zinc International, Vedanta recorded "strong" production of 47kt at Black Mountain and Skorpion in the three months to 31 December, adding that the Gamsberg project was on track for first production in mid-2018.
The firm's oil and gas operations made contract progress, with deals awarded for growth projects as announced in November, and drilling rigs now being mobilised at site.
In aluminium, Vedanta reported a continued ramp-up at Jharsuguda, with division production up 40% year-on-year at 445kt and an exit run-rate of 1.8mtpa.
Copper India's 400kt expansion project remained on track, the board reported, with an EPC contract awarded, while at Copper Zambia, mined metal production was up 12% over the previous year at 24kt.
Custom in Zambia was up 96% year-on-year at 32kt.
Looking at its iron ore operations, Vedanta commenced shipments of higher quality ore from Goa during the period, and was granted additional mining allocation in Goa as well as an increase in its mining cap at Karnataka.
Finally, the company's power operation also made decent progress, as its 1,980 MW TSPL plant achieved record availability of 97%.
On the financial front, Vedants recorded EBITDA of $1.07bn - a 21% improvement year-on-year - which was reportedly driven by higher volumes and commodity prices, partially offset by input commodity inflation.
Its EBITDA margin remained "robust" at 34%.
The board also highlighted the fact that Moody's upgraded its corporate family rating by one notch, from B1 to Ba3, in November.
"We have delivered a robust quarter with EBITDA significantly higher than last year, while the EBITDA margin remained strong," said Vedanta Resources CEO Kuldip Kaura.
"Our ramp-up plans across our well-invested assets are on track and are delivering industry-leading growth."
Kaura said the board and company were "looking forward" to a strong fourth quarter, which would enable Vedanta to end the year with healthy cash generation.
"With the continued strength in the commodity markets, combined with Vedanta's attractive commodity mix and exposure to Indian growth, we will deliver superior shareholder returns, while maintaining a strong balance sheet."