Vedanta Q4 Results: One-Time Impairment Charge Triggers First Quarterly Loss In Five Years
Anil Agarwal-controlled Vedanta Ltd. has reported a surprise quarterly loss for the first time in nearly five years on the back of an impairment.
The mining conglomerate reported a net loss of Rs 12,521 crore in the quarter ended March compared with a profit of Rs 2,615 crore in the corresponding quarter a year ago, according to an exchange filing. The consensus of analysts tracked by Bloomberg had expected a profit of Rs 582 crore.
It had last reported a loss of Rs 233.6 crore, in the three months through March 2015.
Vedanta reported a one-time exceptional loss of Rs 17,132 crore in the March quarter as the impairment in its oil& gas, copper and iron ore businesses was triggered by the Covid-19 pandemic. That was partially offset by a deferred tax credit of Rs 6,524 crore.
Revenue fell 16% year-on-year to Rs 19,755 crore, led by declining commodity prices that were exacerbated by the virus outbreak. Analysts had expected revenue at Rs 19,152 crore.
Operating profit fell 26% year-on-year to Rs 4,552 crore as compared to Rs 6135 crore—slightly higher than the Bloomberg consensus estimate of Rs 4,444 crore.
The company attributed the decline in operating profit to lower volumes and commodity prices, increased operational costs at its zinc and oil and gas subsidiaries. That was partly offset by higher sales at its aluminium, iron ore and steel businesses, lower production costs of aluminium and a weaker rupee.
Key Highlights:
- Interim dividend of Rs 3.9 per share declared for FY20.
- Net debt fell by nearly a fourth year-on-year to Rs 21,273 crore following repayments and unwinding of working capital.
Vedanta said it will decide on the size and timing of future dividend payments only if there's greater clarity on the outlook for the economy and commodity markets.
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