Vedanta (VEDL) Q4 12/13 earnings summary

Executive summary

• FY2012-13 iron ore operations were largely halted by mining bans in Goa and Karnataka; iron ore production fell to 3.7 mt from 13.8 mt and sales to 3.1 mt from 16.0 mt.

• Consolidated profit after tax including associate income was ₹2,280 crore, supported by ₹2,411 crore share of Cairn India profit, despite a consolidated loss after tax of ₹131 crore before associate income.

• Growth initiatives included commissioning expanded pig iron and met coke capacity, adding 59 mt of India resources, and consolidating Western Cluster Limited in Liberia to 100%.

Financial highlights

• Net income from operations was ₹2,554 crore versus ₹8,310 crore in FY2011-12; operating PBDIT was ₹465 crore and operating cash profit (PBDT) was ₹23 crore.

• Consolidated PAT before associate income was a loss of ₹131 crore versus profit of ₹2,108 crore; including ₹2,411 crore associate income, PAT was ₹2,280 crore versus ₹2,696 crore.

• Diluted EPS was ₹26.24 versus ₹31.01 in FY2011-12; the reported consolidated loss before exceptional items and tax was ₹153 crore.

Outlook and guidance

• First Liberia shipments were targeted by end-FY2014; Phase I envisaged 4 mtpa concentrate from Bomi, with a phased longer-term capacity target of 25–30 mtpa.

• Karnataka operations could resume after statutory clearances following the April 2013 Supreme Court order; Goa mines remained suspended pending court and regulatory review.

• Iron ore volumes remained exposed to regulatory action and logistics hurdles; royalty, freight and export duties were expected to pressure costs.