Sterlite Industries (India) Limited Unaudited Results for the First Quarter Ended 30 June 2008
28 July 2008 - 10:09PM
Business Wire
Sterlite Industries (India) Limited (�Sterlite� or the �Company�)
today announced its results for the first quarter ended 30 June
2008 (�Q1�). Highlights Refined zinc and lead production at 128,000
tonnes and 17,000 tonnes, an increase of 38% and 27% respectively
88,000 tpa zinc debottlenecking project successfully completed
Significant improvement in unit costs in Zinc and Copper-India
businesses, despite rising energy costs Dispatches start from the
new aluminium smelter at Jharsuguda, ahead of schedule Commercial
Energy: Awarded the 1,980 MW Talwandi Sabo power project in a
competitive bidding process Net Sales and Attributable Profits at
Rs 5,770 crore and Rs 1,151 crore respectively Strong balance sheet
with net cash position of Rs�12,244�crore Unaudited Consolidated
Financial Highlights (in Rs Crore, except as stated) � � Quarter
Ended 30 June � Change � Year Ended 31 March � 2008 � 2007 � % �
2008 Net Sales/Income from operations 5,770.1 6,139.1 (6 ) 24,705.4
EBITDA 2,229 2,506.2 (11 ) 9,434.3 EBITDA Margin 38.6 % 40.8 % -
38.2 % Depreciation 165.5 203.1 18.5 595.0 Interest 87.4 95.5 8.4
318.6 Profit before tax 1,976.1 2,207.6 (10.5 ) 8,467.9 Taxes 380.8
524.7 27.4 2,102.7 Profit after tax 1,595.4 1,682.9 (5.2 ) 6,365.2
Minority Interest 447 540 17.2 1,961.6 Attributable profits �
1,151.1 � � 1,142.9 � � 0.7 � � 4,399.4 � Earnings Per Share
(�EPS�) (Rupees per share) � 16.3 � � 19.9 � � - � � 65.2 � Copper
Business During Q1, the copper cathode production at the Tuticorin
custom smelter was 68,000 tonnes compared with 81,000 tonnes in the
corresponding prior quarter. The production was lower on account of
the planned bi-annual plant maintenance shut down for 26 days in
May � June�2008. The smelter is now working well and is back to the
normal production levels. We now expect the campaign life of the
smelter now to be about three years. Mined metal production at our
Australian mines was stable at 7,000 tonnes in Q1. Operating costs
in our Tuticorin smelter showed significant improvement despite
high energy costs, primarily due to better copper recovery and
higher by-product realisations. EBITDA for Q1 was higher at
Rs.�584�crore compared with Rs.�382�crore in the corresponding
prior quarter, primarily on account of higher interest income;
better operating efficiencies and by-product management which were
offset by lower TcRcs and increase in fuel prices. TcRcs remained
under pressure in Q1 compared with the corresponding prior quarter.
During Q1, SIIL received the prestigious Golden Peacock Environment
Award 2008 from the World Environment Foundation for its effective
implementation of environment management systems on a sustainable
basis. The Company also received the prestigious Confederation of
Indian Industry award for Excellence in Human Resources. Aluminium
Business Aluminium production in Q1 was 89,000 tonnes compared with
88,000 tonnes produced in the corresponding prior quarter. EBITDA
for Q1 was Rs.�458 crore compared with Rs.�418 crore in the
corresponding prior quarter. The increase in EBITDA was primarily
on account of higher volumes and better LME prices, partly offset
by higher energy related costs. The Lanjigarh alumina refinery
produced 136,000�tonnes of calcined alumina from a single stream
operation using bauxite purchased from third parties and BALCO�s
bauxite. The refinery is performing well and is close to
stabilisation. The recently commissioned Jharsuguda smelter
produced 800 tonnes of aluminium during the quarter. The first
dispatch of aluminium has successfully commenced from Jharsuguda.
The first power unit has been synchronized. We will continue to
progressively commission the Phase�1 pot line together with the
remaining power units. Zinc Business Mined zinc metal and lead
metal production in Q1 was marginally up at 138,000 tonnes and
20,000 tonnes respectively, compared with the corresponding prior
quarter. During Q1, HZL produced 128,000 tonnes of zinc and 17,000
tonnes of lead, an increase of 38% and 27% respectively compared
with the corresponding prior quarter. Consequent to the increase in
smelting capacities and output, availability of surplus concentrate
for sale was limited. EBITDA for Q1 was Rs.�1,187�crore compared
with Rs.�1,706�crore in the corresponding prior quarter. The
positive impact of higher volumes on sales and EBITDA in Q1 was
offset by the adverse impact on account of a decline in zinc LME
prices to $2,115 per tonne in Q1 from US�$3,667 per tonne in the
corresponding prior quarter. During Q1, HZL was able to achieve
significant reduction in the operating cost on the back of
increased volumes, improved operational efficiencies and higher
byproduct credits, partially impacted by the removal of 5% import
duty on zinc during Q1. During the quarter, HZL received the
coveted annual process excellence award for the Best Manufacturing
Process Improvement by International Quality and Productivity
Centre � London. The Rampura Agucha mine received the Overall
Excellence Award from the Federation of Indian Mineral Industries.
Consolidated Net Profit after Taxes and EPS Consolidated Net Profit
after Taxes, attributable to equity shareholders for Q1 was
Rs�1,151�crore compared with Rs�1,143�crore in the corresponding
prior quarter. EPS in Q1 was Rs�16�per equity share compared with
Rs�20 per equity share in the corresponding prior quarter, due to
the fresh issue of shares on account of Sterlite�s ADS offering
during the corresponding prior quarter. Expansion Projects Vedanta
Aluminium Limited In the recent hearings in the Honourable Supreme
Court of India regarding the bauxite mining clearance at Lanjigarh,
all the arguments have been heard and we expect the Court to give
its final judgment shortly. Work on the second phase of the
green-field 500,000 tpa aluminium smelter and associated captive
power plant in Jharsuguda, Orissa, is progressing well. Overall the
project is on schedule. Commercial Energy Work on the 2400 (4X600)
MW coal based independent thermal power plant is progressing on
schedule for commissioning from late�2009 as earlier announced.
Basic engineering is complete and nearly 90% of the detailed
engineering is complete. Civil foundations of the boiler units 1, 2
and 3 are complete and structural erection for the same is
progressing well. During Q1, Sterlite Energy Limited has emerged
successful in an international bidding process and has been awarded
the 1,980 MW thermal power plant at Talwandi Sabo, in the State of
Punjab in India. The project is expected to be completed in 56
months. Zinc and Lead Recently, HZL announced Phase III of it
expansion program, comprising a 210 ktpa Zinc Smelter, 100 ktpa
Lead Smelter and 160 MW of Captive Power Plants. The order for the
Lead Plant and Captive Power Plant has been placed on a lumpsum
turnkey basis and major orders for the Zinc Plant have been placed.
Initial work has started for the smelters and associated mining and
captive power plants. About Sterlite Industries Sterlite Industries
is India's largest non-ferrous metals and mining company with
interests and operations in aluminum, copper and zinc and lead. It
is a subsidiary of Vedanta Resources plc, a London-based
diversified FTSE 100 metals and mining group. Sterlite Industries'
main operating subsidiaries are Hindustan Zinc Limited for its zinc
and lead operations; Copper Mines of Tasmania Pty Limited for its
copper operations in Australia; and Bharat Aluminum Company Limited
for its aluminum operations. The company operates its own copper
operations in India. The company has entered the commercial energy
generation business and is in the process of setting up a 2,400MW
independent power plant through its wholly owned subsidiary,
Sterlite Energy Limited. Sterlite Industries is listed on the
Bombay Stock Exchange and National Stock Exchange in India and the
New York Stock Exchange in the United States. For more information,
please visit www.sterlite-industries.com. Disclaimer This press
release contains �forward-looking statements� � that is, statements
related to future, not past, events. In this context,
forward-looking statements often address our expected future
business and financial performance, and often contain words such as
�expects,� �anticipates,� �intends,� �plans,� �believes,� �seeks,�
�should� or �will.� Forward�looking statements by their nature
address matters that are, to different degrees, uncertain. For us,
uncertainties arise from the behaviour of financial and metals
markets including the London Metal Exchange, fluctuations in
interest and or exchange rates and metal prices; from future
integration of acquired businesses; and from numerous other matters
of national, regional and global scale, including those of a
political, economic, business, competitive or regulatory nature.
These uncertainties may cause our actual future results to be
materially different that those expressed in our forward-looking
statements. We do not undertake to update our forward-looking
statements.
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