TIDMVED
RNS Number : 6966L
Vedanta Resources PLC
29 April 2015
29 April 2015
Vedanta Resources Plc
Vedanta Limited announces Results for the Fourth Quarter and
Year Ended 31 March 2015
Vedanta Resources Plc's subsidiary, Vedanta Limited (formerly
known as Sesa Sterlite Ltd), today announced its financial results
for the Fourth Quarter and Year Ended 31 March 2015.
Vedanta Limited reported a strong set of underlying results,
highlighting the strength of its diversified portfolio of world
class assets in a volatile commodity market. FY2015 Attributable
Profit after Tax (Pre-exceptional Items) was at INR 5,060 crore
(c.$0.8 bn). After adjusting for Exceptional Items, the FY2015
Attributable Loss was at INR 15,646 crore (c.$2.5 bn). The
Exceptional Items primarily consists of a non-cash impairment
charge of INR 19,180 core (c.$3.1 bn) relating to goodwill created
on acquisition of Vedanta Limited's controlling interest in Cairn
India. This charge has arisen from a downward revision in the
carrying value of assets on account of lower oil prices.
This impairment charge will be consolidated into Vedanta
Resources Plc's accounts, although there will be variances related
to differences in accounting treatment between IFRS and Indian
GAAP. At Vedanta Resources Plc, given the fair value upliftment
accounting, the corresponding charge will be higher due to this
accounting treatment. This non-cash charge is not expected to
affect its financial covenants or funding position.
The full text of the release issued by Vedanta Limited is
below.
------------------------------------------------------------------------------------------------------------------
29 April 2015
Vedanta Limited Consolidated Results for the fourth Quarter
and full year ended 31 March 2015
Strong Underlying Results in a Weak Commodity Price
Environment
FY2015 total dividend 26% higher
Mumbai, India: Vedanta Limited (formerly known as Sesa Sterlite
Ltd./Sesa Goa Ltd.) today announced its audited consolidated
results for the fourth quarter (Q4) and full year ended 31 March
2015 (FY 2015).
The Company has been renamed 'Vedanta Limited' from 'Sesa
Sterlite Limited' on 21 April 2015. The name change aligns the
Company's identity with that of its parent, Vedanta Resources Plc,
and provides a unified branding for Vedanta, as a diversified
natural resources group.
Financial Highlights for FY2015
--------------------------------
-- Strong underlying results, on the back of a diversified
portfolio, in a weak commodity price environment
-- Revenue at Rs. 73,364 crore
-- EBITDA at Rs. 22,226 crore; EBITDA margin of 41%(1)
-- Attributable pre-exceptional PAT at Rs. 5,060 crore
-- Gross debt reduced by Rs. 2,814 crore during the year, Cash
& Cash equivalents of over Rs. 46,200 crore
-- Free Cash Flow post capex of Rs. 3,425 crore
-- Contribution of Rs. 27,900 crore to the Indian Exchequer
during the year, in the form of taxes, duties, royalties and profit
petroleum
-- Exceptional items includes a one-time non cash impairment
charge of Rs. 19,956 crore largely relating to Cairn India
acquisition goodwill and the Sri Lanka Block on account of a steep
fall in crude oil prices
-- Final dividend of Rs. 2.35 per share; FY2015 total dividend 26% higher at Rs. 4.1 per share
Operational Highlights for FY2015
----------------------------------
-- Record full year production of mined metal at Zinc India;
better positioned for underground transition
-- Record full year Aluminium and Alumina production; started
new Jharsuguda-II and Korba-II smelters
-- Commenced Iron ore production at Karnataka, final approval
awaited at Goa; record annual production of Pig Iron
-- Oil & Gas production normalised post shutdown in Q2
Mr. Tom Albanese, CEO, Vedanta Limited, said: "There have been
several positive developments in 2015; record annual mined metal
production at Zinc-India, record aluminium production as the new
Jharsuguda-II and Korba-II smelters are ramping up well, and record
alumina production at the Lanjigarh refinery. We have also
commenced iron ore production in Karnataka and mining activities in
Goa are expected to resume in the latter half of 2015. We have
taken actions to maintain financial strength and flexibility during
this period of weak commodity prices through capital re-phasing and
cost management initiatives. We remain confident of our diversified
business model and low cost asset base and will continue to
generate attractive returns to our shareholders."
He also added, "Our Q4 results include a one-time non-cash
impairment charge of acquisition goodwill, largely relating to the
Oil & Gas business and the Sri Lanka Block on account of a
steep fall in crude oil prices. This has no impact on the
production or future earnings capacity of these assets."
(1) Excludes custom smelting at Zinc and Copper India
operations
Consolidated Financial Performance
-----------------------------------
The merger of Sesa Goa Ltd. and Sterlite Industries India Ltd.,
and the Vedanta Group consolidation was completed in August 2013.
Consequently Q4 and FY2015 performance is compared with the
adjusted proforma numbers of respective periods, which are more
representative of the performance during the period.
(In Rs. crore, except as stated)
Q4 Q3 Full Year
---------------------- ------------------------------------------ ------- ------------------------------------------
Particulars (In Rs. FY 2015 FY 2014 (Adjusted % Change FY FY 2015 FY2014 (Adjusted % Change
Crore, except as Actual Proforma) YoY 2015 Actual Proforma) YoY
stated)
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Net Sales/Income from
operations 17,732 20,785 (15)% 19,128 73,364 72,591 1%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
EBITDA 3,986 6,665 (40)% 6,234 22,226 25,603 (13)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
EBITDA margin (1) (%) 28% 45% - 43% 41% 47% -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Finance cost 1,321 1,537 (14)% 1,329 5,659 6,111 (7)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Other Income 41 764 (95)% 429 2,367 2,210 7%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Forex loss/ (gain) 184 30 - (393) (611) (505) -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Profit before
Depreciation and
Taxes 2,275 5,961 (62)% 5,639 19,088 21,937 (13)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Depreciation 250 1,469 (83)% 1,782 5,110 5,584 (8)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Amortisation of
goodwill 514 924 (44)% 546 2,050 2,840 (28)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Profit before
Exceptional items 1,787 3,569 (50)% 3,311 12,204 13,514 (10)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Exceptional Items 19,956 167 - 0 22,129 167 -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Taxes 549 328 68% 478 1,448 1,000 45%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Profit After Taxes (18,718) 3,074 - 2,834 (11,373) 12,347 -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Profit After Taxes(
before exceptional) 1,166 3,241 (64)% 2,834 10,183 12,514 (19)%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Minority Interest 514 1,852 (72%) 1,246 4,276 7,342 (42%)
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Attributable PAT
(after exceptional) (19,228) 1,222 - 1,588 (15,646) 5,005 -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Attributable PAT
(before exceptional) 491 1,389 (65)% 1,588 5,060 5,172 (2%)
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Basic Earnings per
Share (Rs./share) (64.85) 4.12 - 5.35 (52.77) 16.88 -
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Earnings per Share
before exceptional
(Rs./share) 1.66 4.69 (65)% 5.35 17.07 17.44 (2%)
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Exchange rate (Rs./$)
- Average 62.25 60.50 3% 62.00 61.15 60.50 1%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
Exchange rate (Rs./$)
- Closing 62.59 60.10 4% 63.33 62.59 60.10 4%
---------------------- --------- -------------------- --------- ------- --------- -------------------- ---------
1. Excludes custom smelting at Zinc and Copper India operations
Revenue
Revenues in Q4 were 7% lower sequentially and 15% lower Y-o-Y,
on account of decline in oil and copper prices.
Revenue for the year remained strong, up by 1% at Rs. 73,364
crore. Higher volumes at Copper India, aluminium ramp up at Korba,
commissioning of Unit I at TSPL and iron ore sales from Karnataka
partially offset weaker commodity prices in the latter half of the
year.
EBITDA and EBITDA Margin
EBITDA in Q4 was 36% lower sequentially and 40% Y-o-Y on account
of lower commodity prices, particularly a 50% fall in oil prices,
and higher exploration charges at Cairn India. Additionally,
increased levy provision of 35% of royalty for District Mineral
Foundation (33%) and National Mineral Exploration Trust (2%) at
Zinc India post MMDR Act impacted margins sequentially.
Normalised EBITDA during Q4 was Rs. 4,500 crore excluding the
impact of one-off charges on exploration expenses in Oil & Gas
segment of Rs. 280 crore and provision made for GRIDCO receivable
of Rs. 270 crore.
EBITDA for the full year was Rs. 22,226 crore, a decline of 13%
due to lower volumes, increased exploration costs, lower prices and
higher profit petroleum in the Oil & Gas segment. This was
supplemented by lower volumes during H1 2015 and higher costs of
production on account of increase in royalty rates and coal prices
at Zinc India. Weaker oil prices were significantly offset by
stronger Zinc and Aluminium premium and prices during the year.
Depreciation and Amortisation
The Company has with effect from 1(st) April 2014, revised the
estimated useful lives of various assets in its metals, mining and
power businesses based on an independent technical study and
management's assessment thereof. In addition, one-time adjustments
in the Oil & Gas business relating to de-commissioning expenses
led to lower depreciation during the year. Consequently, the
depreciation charge for the quarter and the year is lower by Rs.
1,219 crore and Rs. 474 crore respectively.
This was partially offset by higher depreciation charge at Cairn
India, with effect from 1(st) April 2014, on account of change in
depreciation method from Straight Line Method (SLM) to Unit of
Production (UOP) on tangible assets by Rs. 401 crore.
Capitalization of aluminium pot-lines at Korba Plant II and Unit I
of TSPL during Q2 and capitalization of pipeline expenses at Cairn
during Q4 for the full year added to the depreciation for the year.
Thus depreciation for the full year was at Rs. 5,110 crore as
compared to Rs. 5,584 crore in FY2014.
Amortisation of goodwill was lower by Rs. 410 crore and Rs. 790
crore for Q4 and the full year respectively, mainly due to
accelerated charge in the previous year at Lisheen.
Net Interest
Finance cost was 7% lower at Rs. 5,659 crore as compared to Rs.
6,111 crore in previous year. This was on account of initiatives
pertaining to lower cost refinancing of external loans including
FCCBs, project loans as well as part repayment of Cairn India
acquisition related intercompany loan from parent, Vedanta
Resources Plc.
Other income for the quarter at Rs. 41 crore is significantly
lower than the corresponding previous quarter as well as
sequentially. This was largely due to timing differences where
income earned on certain investments are recognized at maturity.
Other income was also significantly lower than that recognized at
our subsidiaries, HZL and Cairn India, due to non-accrual of income
on account of partial adoption of AS 30 at Vedanta Ltd. as compared
to complete adoption of AS 30 at these subsidiaries. The full year
other income is higher than previous year due to marked to market
gains on the investment portfolio in a declining interest rate
environment.
Exceptional Items, including Impairment of Goodwill
Exceptional items in Q4 was Rs. 19,956 crore, which included Rs.
19,180 crore of impairment charge relating to goodwill created on
acquisition of Cairn India . The impairment was triggered by a
steep fall in crude oil prices, leading to a downward revision of
the carrying values on the books. Sri Lankan exploratory assets in
the Oil & Gas segment have also been impaired by Rs. 505 crore
(as announced by Cairn India Ltd.) given the commercial
non-viability of the discovery in light of a softer oil price
outlook. Further, Rs. 281 crore is on account of impairment of
acquisition goodwill related to Copper Mines of Tasmania, Australia
which has been under care and maintenance following a mud rush in
January 2014.
The above mentioned impairment is a non-cash charge and does not
affect any of the Company's financial covenants, its funding
position or its earning capacity.
In addition to the above, full year exceptional items also
include Rs. 2,128 crore (gross of tax) provided for in Q1 resulting
from change in method of depreciation at Cairn India for the period
up to 31(st) March 2014. This was supplemented by Rs. 45 crore
provided for in Q2 relating to write off recognised in respect of
investment in cancelled coal blocks of the company in September
2014 pursuant to the Supreme Court decision; this was revised down
to Rs. 34 crore in Q4, hence there was a write back of Rs. 11 crore
in Q4.
Non-Operational Forex Loss/Gain
FY2015 includes a net forex gain of Rs. 611 crore primarily due
to the impact of the weaker rupee on the dollar denominated cash
and liquid investments at Cairn India.
Taxation
Tax charge in FY2015 is Rs. 1,448 crore (Rs. 2,019 crore before
exceptional item with tax rate of 16%) compared with Rs. 1,000
crore (tax rate 7%) in FY2014.
The movement in effective tax rate is primarily driven by higher
deferred tax recognised due to higher exploration & development
spend in Cairn India. This was further accentuated by deferred tax
assets on losses in FY2014 in the standalone business.
Attributable Profit after Tax and EPS (before Exceptional
Items)
As a result of lower EBITDA on account of weak commodity prices
being more than offset by lower finance costs, depreciation,
amortisation and minority interests, the attributable Profit after
Tax (before exceptional items) for FY2015 was stable at Rs. 5,060
crore against Rs. 5,172 crore in FY 2014. Minority interest at 50%
for the year (59% in FY2014) was driven by higher profitability in
fully owned Aluminium & Copper businesses at Ved Ltd.
standalone and lower profit in Oil & Gas subsidiary. The
earnings per share before exceptional items were Rs. 17.07 per
share for FY 2015 as compared to Rs. 17.44 per share in previous
year.
Borrowings and Investments
Gross debt reduced by Rs. 2,814 crore to Rs. 77,752 crore as on
31(st) March 2015 from Rs. 80,566 crore as on 31 March 2014. This
was largely driven by retirement of loans from available cash
balances.
Out of total loan of Rs. 77,752 crore, the loan in INR currency
is Rs. 33,512 crore and balance Rs. 44,240 crore is in US dollar.
Further, the gross debt comprises of long term loans of Rs. 64,116
crore and short term working capital loans of Rs. 13,636 crore.
Average rate of borrowing was 7.9% in FY 2014-15.
We continue to have a strong balance sheet with cash and liquid
investments of Rs. 46,212 crore as on March 31, 2015 which is
mostly invested in debt related mutual funds, bank deposits and
bonds.
The company has a long term rating of AA+ (negative) from
CRISIL.
Dividend
The Board has declared a final dividend of Rs 2.35 per share.
The total dividend including interim dividend for FY2015 is Rs 1.75
per share. The total dividend outgo will be Rs. 1,216 crore.
Corporate
Sesa Sterlite Limited renamed Vedanta Limited
The Shareholders of the Company approved the name change of the
Company through Postal Ballot, results of which were announced on
March 30, 2015. The name change to Vedanta Limited was effective
post issue of 'Fresh Certificate of Incorporation' issued by the
Registrar of Companies, Goa, Ministry of Corporate Affairs (MCA),
Govt. of India. The name change aligns the Company's identity with
that of its parent, Vedanta Resources Plc, and provides a unified
branding for the Vedanta group, as a diversified natural resources
company. The name change is a significant milestone which reflects
Vedanta's continued commitment to strengthen the linkage between
its businesses, communities and stakeholders.
The change in the name of the company will have no impact on the
divisions and subsidiaries of the company.
Appendix
---------
Debt and Cash
(in Rs. Crore)
Company 31 March 2015 31 December 2014 31 March 2014
---------------- -------------------------------- -------------------------------- --------------------------------
Debt Cash & LI Net Debt Debt Cash & LI Net Debt Debt Cash & LI Net Debt
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Ved Ltd
Standalone 37,636 840 36,796 38,480 693 37,787 38,943 2,459 36,484
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Zinc India - 27,192 (27,192) - 26,355 (26,355) - 23,943 (23,943)
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Zinc
International - 857 (857) - 1,398 (1,398) - 1,204 (1,204)
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Cairn India - 17,040 (17,040) 158 18,079 (17,921) - 23,017 (23,017)
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
BALCO 5,456 2 5,454 5,508 2 5,506 4,786 1 4,785
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Talwandi Sabo 6,541 152 6,389 6,343 20 6,323 5,028 22 5,006
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Cairn
acquisition
SPV (1) 26,850 54 26,796 27,145 116 27,029 30,614 50 30,564
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Others (2) 1,269 75 1,194 1,462 143 1,319 1,195 101 1,094
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Ved Ltd
Consolidated 77,752 46,212 31,540 79,096 46,806 32,290 80,566 50,797 29,769
---------------- --------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
1. As on 31 March 2015, debt at Cairn acquisition SPV comprises
Rs.10,640 crore of bank debt and Rs.16,210 crore of inter-company
debt from Vedanta Resources Plc. There was an accrued interest
payable of Rs.100 crore on the inter-company debt.
2. Others includes CMT, VGCB, Fujairah Gold, and Vedanta Ltd. investment companies.
Debt Maturity Profile
(in Rs. Crore)
Particulars FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2020 Total
(1) & Later
----------------------- -------- -------- -------- -------- -------- --------- -------
Ved Ltd. Standalone 3,841 3,196 6,425 6,599 2,614 2,859 25,534
----------------------- -------- -------- -------- -------- -------- --------- -------
Ved Ltd. Subsidiaries 8,123 3,724 3,374 3,328 1,363 2,460 22,372
----------------------- -------- -------- -------- -------- -------- --------- -------
Total 11,964 6,920 9,799 9,927 3,977 5,319 47,906
----------------------- -------- -------- -------- -------- -------- --------- -------
(1) Maturity profile excludes working capital facilities of
Rs.13,636 crore and inter-company loan from Vedanta Plc
Debt numbers in the tables above are at book value
Note: Figures in previous periods have been regrouped or
restated, wherever necessary to make them comparable to current
period.
Results Conference Call
Please note that the results presentation is available in the
Investor Relations section of the company website
www.vedantalimited.com
The results call will be at 6:00 PM (IST) on Wednesday, 29 April
2015, where we will refer to the above mentioned presentation. The
dial-in numbers for the call are:
Event Telephone Number
----------------------- ----------------------------------------------- -----------------------------------
Earnings conference Mumbai main access
call on +91 22 3938 1088
29 April 2015 India - 6:00 PM (IST) Mumbai standby
access
+91 22 6746 8388
----------------------- ----------------------------------------------- -----------------------------------
Toll free number
800 101 2045
Singapore - 8:30 PM
(Singapore Time)
----------------------- ----------------------------------------------- -----------------------------------
Toll free number
800 964 448
Hong Kong - 8:30 PM
(Hong Kong Time)
----------------------------------------------- -----------------------------------
Toll free number
UK - 1:30 PM (UK Time) 0 808 101 1573
----------------------------------------------- -----------------------------------
Toll free number
US - 8:30 AM (Eastern 1 866 746 2133
Time)
----------------------- ----------------------------------------------- -----------------------------------
For online http://services.choruscall.in/diamondpass/registration?confirmationNumber=5267915
registration
----------------------- ------------------------------------------------------------------------------------
Mumbai
Replay of Conference +91 22 3065 2322
Call +91 22 6181 3322
(29 April 2015 Passcode: 63835#
to 6 May 2015)
----------------------- ----------------------------------------------- -----------------------------------
For further information, please contact:
Communications Finsbury
Roma Balwani
President - Group Communications, Gordon Simpson
Sustainability Tel: +44 20 7251 3801
and CSR
Tel: +91 22 6646 1000
gc@vedanta.co.in
Tel: +44 20 7659 4732
Investors Tel: +91 22 6646 1531
Ashwin Bajaj ir@vedanta.co.in
Director - Investor Relations
Anshu Goel
Vice President - Investor
Relations
Radhika Arora
Associate General Manager
- Investor Relations
About Vedanta Resources plc
Vedanta Resources plc ("Vedanta") is a London listed diversified
global natural resources company. The group produces aluminium,
copper, zinc, lead, silver, iron ore, oil and gas and commercial
energy. Vedanta has operations in India, Zambia, Namibia, South
Africa, Ireland, Liberia, Australia and Sri Lanka. With an
empowered talent pool globally, Vedanta places strong emphasis on
partnering with all its stakeholders based on the core values of
entrepreneurship, excellence, trust, inclusiveness and growth. For
more information, please visit www.vedantaresources.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.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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