Hindustan Zinc Q3 net declines 56%

Hindustan Zinc, the country’s largest zinc and lead producer, posted 56 per cent decline in net profit at Rs 369 crore in the third quarter of the current financial year as compared to Rs 834 crore in the corresponding period last year. Net quarterly sales of the company also slumped 38 per cent at Rs 1031 crore from Rs 1658 crore.

During the nine months ended December 31, the Vedanta group company, reported 32 per cent fall in net profit at Rs 2,176 crore as compared to Rs 3,214 crore in the same period last year on a sales of Rs 4,418 crore versus Rs 5,612 crore.

The company attributed to fall in sales and net profit to dramatic decline in global zinc, lead and silver prices during the quarter under consideration.

The company achieved its highest ever quarterly production in Q3 for both mined and saleable metal. During Q3, HZL produced 191,684 tonnes of mined metal and 166,539 tonnes of saleable metal, an increase of 24 per cent and 40 per cent, respectively as compared with the corresponding prior quarter.

For the nine months period, mined and saleable metal production was 537,592 tonnes and 445,812 tonnes, respectively, an increase of 14 per cent and 34 per cent over the corresponding prior period.

During Q3, saleable silver metal production was at 24,722 kilograms, an increase of 23 per cent compared with the corresponding prior quarter. For the nine months period, saleable silver metal production was 69,879 kilograms, an increase of 24 per cent compared with the corresponding prior period.

The positive impact of increased volume and rupee depreciation was more than offset by the sharp decline in the benchmark LME zinc prices of nearly 55 per cent. Average LME price for zinc and lead during Q3 was $1,189 and $1,251 respectively, compared with $2,646 and $3,262 in the corresponding prior quarter.

The cost of production during Q3 was higher on account of higher input costs of coal, petroleum products, and met coke and lower realization from the sale of by - products. However, towards the end of Q3, the downward trend in the unit cost of key inputs became visible, and is expected to lower the cost of production going forward.