Hindustan Zinc Q2 Results: Profit Declines 35%, Misses Estimates
The company's Q2 net profit fell 35% year-on-year to Rs 1,737 crore, missing the Bloomberg consensus estimate of Rs 1,914 crore.
Hindustan Zinc Ltd.'s second quarter profit declined, missing analysts' estimates.
The Vedanta-owned integrated zinc producer's net profit fell 35.2% year-on-year to Rs 1,737 crore in the quarter ended September, according to an exchange filing on Friday. That compares with the Rs 1,914-crore consensus estimate of analysts polled by Bloomberg.
Hindustan Zinc Q2 FY24 Key Highlights (Standalone, YoY)
Revenue down 18.52% at Rs 6,792 crore (Bloomberg estimate: Rs 6,788.9 crore).
Ebitda down 28.79% at Rs 3,139 crore (Bloomberg estimate: Rs 3,426.9 crore).
Ebitda margin at 46.22% vs 52.88% (Bloomberg estimate: 50.5%).
Net profit down 35.21% at Rs 1,737 crore (Bloomberg estimate: Rs 1,914 crore).
Operating profit declined on account of lower realisations, especially for zinc, combined with lower metal sales.
Profit before tax expenses from zinc and lead, its primary segment, fell 55.5% to Rs 1,173 crore. This decline was due to a 2% YoY fall in saleable metal production at 2,41,000 tonne, on account of maintenance activity along with lower zinc realisations.
Integrated zinc production was down 2% at 1,85,000 tonne and refined lead production fell 0.1% YoY at 57,000 tonne. Zinc cost of production before royalty for the quarter was at $1,137 per tonne, lower by 9.7% YoY on account of softened coal and input commodity prices.
Profit from its silver business also rose by 17.1% at Rs 1,123 crore, with integrated silver production decreasing 7% YoY to 181 tonne.
The company paid a dividend of Rs 2,958 crore during the quarter
Hindustan Zinc commissioned its Fumer plant and Rajpura Dariba Mill in Q2 and full ramp-up of the mill is expected by Q3 FY24.
The company had previously announced plans to separate its zinc, lead, silver and recycling businesses in a bid to unlock potential value.
FY24 Outlook
The company reiterated its FY24 project capex guidance of $175-200 million.
Mined metal is expected to be between 1,075-1,100 kilo tonne and refined metal production in the range of 1,050-1,075 kilo tonne.
Saleable silver production is projected to be between 725-750 tonne.
Zinc cost of production in FY24 is expected to be between $1,125-1,175 per MT.
Shares of Hindustan Zinc were trading 2.2% lower at Rs 307.5 apiece after the results were announced, as compared with a 0.38% decline in the benchmark NSE Nifty 50 at 2:34 p.m.
