Vedanta outgoing CEO Tom Albanese
MUMBAI – Vedanta reported a fourth-quarter profit as India’s biggest base metals producer benefited from a rally in prices and a special dividend announced by its zinc arm.
Net income attributable to owners was 14.1-billion rupees in the three months through March and revenues were Rs246.1-billion, the unit of London-listed Vedanta Resources said in a statement Monday. That compares with a loss of Rs138.4-billion a year ago because of a writedown at its oil unit.
A surge in zinc prices globally saw profit at unit Hindustan Zinc surge 43% in the quarter from a year earlier and the company announced a record payout to investors in March. Vedanta’s billionaire chairman Anil Agarwal got another lift in April after shareholders approved merging the company with his Indian energy business, Cairn India, as he bids to create a resources heavyweight in the mold of Australia’s BHP Billiton.
A near $1.2-billion windfall from Vedanta’s 65% stake in Hindustan Zinc and access to about $4-billion in cash at Cairn India will help soften concerns over its debt pile, according to ratings agencies. Vedanta’s gross debt stood at Rs636.6-billion at the end of March, while cash and liquid investments were Rs634.7-billion, according to the company.
“Our strategic focus to ramp up production across the portfolio namely in zinc, aluminium, power and iron-ore businesses throughout the year has supplemented revenue growth,” outgoing CEO Tom Albanese said in the statement. Record production of zinc and aluminium and cost management initiatives also helped the company boost profits, he said.
Vedanta’s stock rose 1.8% to close at Rs241 on Monday, putting it up 11% for the year. Zinc prices in London advanced 36% in the past year due to a shortfall in production of the metal used to galvanize steel.