Vedanta’s Q4 net profit plunges 43% to Rs2,615 crore

Its ’s stock fell by about 3 per cent in today’s trade post its announcement of Q4 results on Tuesday.

The Anil Agarwal-led Vedanta on Tuesday said it consolidated revenue stood at Rs23,468 crore for the March quarter, compared with Rs27,630 crore in the same period of 2018-19.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) for Q4 FY19 stood at Rs6,330 crore, 6 per cent higher Q-o-Q, primarily due to improved cost of production of aluminium, higher sales of iron ore at Karnataka, ESL and Zinc International, partially offset by lower commodity prices, rupee appreciation, lower volumes at Zinc India and writeback of liability pursuant to settlement agreement with a contractor at Balco in Q3 FY2019, Vedanta said in a regulatory filing.

For the financial year FY19, EBITDA was at Rs24,012 crore, down 4 per cent Y-o-Y, mainly due to the shutdown of Tuticorin smelter, input commodity inflation and higher cost of production at zinc businesses, partially offset by rupee depreciation, volume additions from ESL and ramp up of volume at aluminium. We maintained a robust EBITDA margin of 30 per cent for the year (FY18: 35 per cent), Vedanta stated.

Depreciation for Q419 was at Rs2,258 crore, marginally higher Q-o-Q, primarily due to capitalisation of costs and ore production post commencement of Gamsberg operations. Depreciation and amortisation for FY19 were at Rs8,192 crore, higher by 30 per cent. This was mainly due to change in reserves estimates and reversal of the previously recorded impairment at oil and gas business in Q418, higher charge due to higher ore production at zinc businesses and capitalisation of costs at Gamsberg, and acquisition of ESL.

Exceptional gains for FY19 was at Rs320 crore mainly due reversal of previously recorded impairment of Rs261 crore in the KG ONN block of the Oil and Gas business and reversal of a Rs59 crore charge relating to arbitration of a historical vendor claim pursuant to Supreme Court order in the aluminium business.

The exceptional gain for FY18 was at Rs2,897 crore primarily because of reversal of previously recorded impairment of Rs7,016 crore at oil and gas business partially offset by impairment of Iron Ore Goa assets of Rs2,329 crore due to suspension of mining operations pursuant to Supreme Court order and reclassification of FCTR relating to subsidiary investment companies under liquidation of Rs1,485 crore.

"FY2019 was a year of production ramp-up alongside robust financials and delivering repeated and industry leading returns to our shareholders. Acquisition of ESL and its successful turnaround, as well as the commencement of the long-awaited Gamsberg project, both, represent significant additions to our operating business portfolio," Navin Agarwal, chairman, Vedanta Limited, said.

"Looking ahead, FY2020 will be an exciting year of growth in our key businesses – Zinc-Lead-Silver, Oil & Gas and Aluminium, being pursued with a strict capital allocation framework. We have also set stricter HSE standards and will continue our journey towards zero harm by ensuring greater levels of safety and sustainability," Srinivasan Venkatakrishnan, chief executive officer, Vedanta, said.

Shares of Vedanta Ltd settled at Rs 163.40 apiece, down 2.07 per cent on the BSE.