Vedanta Resources 4Q Metals Output Rose Vs 3Q

LONDON--Vedanta Resources PLC (VED.LN) Wednesday said that output and sales volumes of finished metal products rose in the fourth quarter from the third, but that copper and zinc prices slipped during the period.

The FTSE 100-listed metals and mining company also reported a rise in output from its Zambian copper-production operations, which produced 37,000 tons of copper cathode in the fourth quarter, up from 35,000 tons in the third quarter.

Output from the company's Zambian assets had previously suffered after production was hit by environmental problems.

The Zambian output is also up from 17,000 tons in the same quarter a year ago, when mined production was hit by lower ore grades and operational matters.

Copper cathode production at Vedanta's core Indian operations was 89,000 tons in the fourth quarter, up 19% from the prior corresponding period, due to debottlenecking of its facility at Tuticorin.

Debottlenecking is the elimination process used to get rid of production bottlenecks in order to improve plant efficiency.

The company said its overall copper production rose mainly because of an increased contribution from stabilization of phase 1 projects, with plants now operating at near-rated capacities in the fourth quarter. It also attributed the increase to successful debottlenecking activities.

However, the company didn't provide an estimate for full-year earnings.

Vedanta's refined zinc output in the fourth quarter was 95,000 tons, up slightly from 93,000 tons in the third quarter.

A new smelter at Chanderiya, India, contributed to a 23% overall rise in the full year to 348,000 tons.

Elsewhere in India, Vedanta said the commissioning process began in the last week of March at its Lanjigarh alumina refinery, with the charging of sourced bauxite. It also said that basic engineering work on a new $1.9 billion greenfield 2,400 megawatt integrated power project at Jharsuguda is progressing on schedule.

Vedanta produces a range of metals, with key products including aluminum, copper, zinc and lead. Its main operations are in India.

At 0810 GMT, Vedanta shares traded down 0.91%, or 13 pence, at 1,419 pence. While they have outperformed the mining sector this year, they continue to trade below their levels of a year ago.

In the three months to Dec. 31, 2006, Vedanta's Ebitda was $724.3 million, compared with $264.6 million for the comparable period in the previous financial year.