By Alex MacDonald
LONDON--India-focused natural resources company Vedanta
Resources PLC (VED.LN) Friday reported lower earnings during its
third-quarter due to lower profitability from its oil and gas
division and a slump in the profitability of its Zambian copper
operations.
The producer of commodities ranging from zinc to copper, iron
ore and aluminum, said earnings before interest, taxes,
depreciation and amortization, or Ebitda, dropped 11% to $1.02
billion in the three months ended Dec. 31, compared with the same
period a year before. Revenue rose 1% to $3.36 billion.
The Ebitda of its majority-owned Cairn India Ltd. (532792.BY)
oil and gas company fell 44% after the unit was hit by the slump in
the price of oil and a 2% drop in oil and gas production during the
period.
Meanwhile, lower copper price and higher production costs saw
revenues at its Zambian copper operations fall by 5%. Vedanta said
the decision by the Zambian government to increase royalty rates
from the start of the year would hit its majority-owned Konkola
Copper Mines PLC unit by around $15 million in the fourth quarter,
equal to about all of its Ebitda for the first nine months of its
fiscal year.
Vedanta swung to a small profit at its iron ore division from
the sale of additional iron ore, even though production was crimped
by the suspension of its operations in India's key iron-ore
producing states of Goa and Karnataka. The company said it expects
to begin producing iron ore from Karnataka by February and from Goa
from the start of April onwards. Iron ore production in both states
had been suspended due to a mining ban.
The company said its net debt dropped to $8.8 billion at the end
of December from $9 billion at the end of September.
-Write to Alex MacDonald at alex.macdonald@wsj.com
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