Millennium Post

Vedanta swings to red on weak world commodity prices; revenue dips 11.6%

Diversified global player Vedanta Resources, led by NRI billionaire Anil Agarwal, on Thursday clocked $196 million attributable loss for 2013-14 fiscal on weak commodity and oil prices as well as lower sales.
The company, which has interests in oil & gas, copper, zinc, iron ore, aluminium and silver among others in India and abroad, had reported $162 million attributable profit in the previous fiscal.

The company attributed the loss to $417.7 million dip in EBITDA (operating profit) and one-offs such as accelerated amortisation on a large convertible bond series, among others.

‘Revenue was down 11.6 per cent at $12.9 billion primarily driven by weaker commodity and oil price environment and temporary business closures due to regulatory issues though partly offset by improved volumes at Cairn India, Zinc India,’ Vedanta said in a statement.
Vedanta is one of the world's top seven resources firms with operations in India, Zambia, Namibia, South Africa, Ireland, Liberia, Australia and Sri Lanka.

Lack of sales at its iron ore business due to the mining ban in Goa, combined with only marginal sales in Karnataka in the fourth quarter, contributed to a negative variance of $123.7 million to operating profits. Tuticorin smelter closure impacted operating profit by $32.9 million. ‘However, improved operational performance with volume increase in Cairn India, Zinc India and effective cost control measures across our businesses partially mitigated the downside,’ it said.

Agarwal, Vedanta's Chairman, said: ‘FY14 has been a year of building momentum in the right direction, and I see it as a powerful springboard for the year ahead as we build on the significant headway achieved in production ramp-ups, cost controls, regulatory clearances and sustainability.’
Lower EBITDA reflected weaker global commodity and oil prices, increased rate of share of profit petroleum to India Government, Agarwal said, adding that they were partly offset by lower costs in aluminium, increased volumes at Zinc India and record oil production.
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