Vedanta Q3 profit falls 99% on low commodity prices

MUMBAI: Natural resources conglomerate Vedanta Ltd reported third-quarter net profit of Rs 17.91 crore for the quarter ended December, down 99 per cent from Rs 1,587.50 crore in the same quarter last year, as it continues to be impacted by falling commodity prices worldwide.

Sales at the Anil Agarwal-controlled company fell 23 per cent to Rs 14,800.97 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) margin fell to 26 per cent from 43 per cent during the quarter. Analysts were expecting an adjusted loss ofRs 103.86 crore on revenue ofRs 14,486.35 crore, according to a Bloomberg poll.

"The commodity turnaround is just around the corner… in a few months," said Vedanta CEO Tom Albanese on a media call. "Better days are coming. We will successfully navigate the tough patch to enjoy the harvest."

The company's total expenses fell 12 per cent during the quarter to Rs 13,541 crore. The company said it is actively managing its balance sheet in light of the current commodity price environment with a focus on maximizing free cash flow, refinancing and terming out maturing debt and simplifying the group structure.

It forecast a capital expenditure of $1 billion for the next year, but cautioned that given the dynamic situation, this figure could change going ahead.

Vedanta is in the process of merging Cairn India with itself. The merger, if successful, will help the highly leveraged Vedanta access Cairn’s cash flows and improve liquidity. Albanese said it expects shareholders to vote on the merger in the current quarter.