Vedanta Q4 net profit drops 10% to Rs 5,799 crore, but Ebitda highest ever

Mining and metals major Vedanta’s consolidated net profit for the March quarter (Q4) dropped 10 per cent year-on-year (YoY) to Rs 5,799 crore. However, its revenue from operations (net sales) jumped 41 per cent YoY to Rs 39,342 crore for the same period, supported by higher sales volumes and improved commodity prices.
 
The company reported an exceptional loss of Rs 330 crore in Q4, mainly in its copper division, which contributed to the drop in its net profit for the period.
 
Consolidated earnings before interest, tax, depreciation, and amortisation (Ebitda) in Q4 jumped 51 per cent, the highest ever for the company, to Rs 13,768 YoY. Ebitda margin for the quarter stood at 39 per cent, the company said, after excluding custom smelting at the copper business. Analysts had estimated an Ebitda margin of 35 per cent in the period under review.
 
A Bloomberg consensus estimate had pegged a 16.8 per cent rise in Q4 net profit at Rs 6,243 crore and a 33.3 per cent jump in revenue for the company at Rs 37,162 crore.  Ebitda or operating profit was in line with the consensus estimates at Rs 13,107 crore, said Bloomberg, as the company focused on improving operational efficiencies.

For the financial year ended March (FY22), the company’s consolidated revenue, net profit, and Ebitda stood at Rs 1.31 trillion, Rs 18,802 crore, and Rs 45,319 crore, a jump of 51 per cent, 62 per cent, and 66 per cent over the year-ago period, respectively.
 
In a media call on Thursday, Vedanta Chief Executive Officer Sunil Duggal said the company’s relentless focus on volume growth and cost reduction had aided both revenue and operating profit growth. The company has operations in metals such as zinc, aluminium, copper, iron ore, and steel, apart from production of oil and gas and power.
 
In the past three years, the contribution of aluminium to Vedanta'a Ebitda has jumped from 9 per cent (in FY20) to 38 per cent (in FY22). Zinc remains a primary contributor to Vedanta's Ebitda at 39 per cent, with oil and gas at 13 per cent, analysts tracking the company said.
 
The company’s board of directors also approved its first interim dividend of Rs 31.5 per equity share for the financial year 2022-23 (FY23) amounting to Rs 11,710 crore in terms of payout, it said when announcing its Q4 results. For FY22, Vedanta had paid Rs 45 per share as dividend, amounting to Rs 16,728 crore in terms of payout. “This is a 14 per cent dividend yield, which is among the highest within the company’s peer set,” Duggal said.