VANCOUVER (miningweekly.com) – Brazilian diversified miner Vale – the world’s largest producer iron-ore – has reported a bigger than 36% drop in profit attributable to shareholders for the three months ended March 31.
The Rio de Janeiro-based multinational blamed a 12.4% slide in iron-ore prices to $66.41/t in the period for the disappointing performance, despite reporting record sales volumes for the period.
Vale reported first-quarter net income of $1.59-billion, compared with $2.49-billion reported in the same period of a year earlier.
Adjusted earnings before interest, taxes, depreciation and amortisation, fell nearly 8% year-on-year to $3.97-billion.
Net operating revenue rose 1% to $8.6-billion from the first quarter of last year, while costs and expenses rose by nearly 10%, the miner reported.
Vale said iron-ore fines rose 11.2% to 70.8-million tonnes, a record for the first quarter.
Vale slashed its net debt to $14.9-billion in the quarter from more than $18-billion at the close of 2017, taking it to the lowest level in nearly seven years. The company promised to lower its debt to $10-billion in the "short term", after saying in January it hoped to reach that target by mid-2018.
Capital expenditures have reached the lowest level for a first quarter since 2005, totalling $890-million during the first quarter, Vale said, with $361-million earmarked for project execution and $529-million set aside as sustaining capital.
Vale has produced fewer tonnes of iron-ore during the first quarter on account of heavy rains, but it managed to lift iron-ore sales 9% year-on-year to 71.22-million tonnes in the first quarter. Pellet output grew 2.9% to 12.78-million tonnes, while sales of the product increased by 4.3% to 13.13-million tonnes.
Vale has guided for full-year 2018 iron-ore output of 390-million tonnes.