Vedanta profit up 3-fold on price recovery

Mumbai: India’s largest copper producer Vedanta Resources on Thursday said the group’s full-year profit almost trebled, as a global economic recovery spurred commodity prices.

Vedantas’s net income grew 175% to $602.3 million in the year ended March 31, 2010, from $219.4 million a year earlier. The group’s revenues rose 21% to $7.9 billion and EBITDA surged 42% to $2.3 billion during the year. Basic earnings per share increased 187% to $2.20.

Vedanta, controlled by NRI billionaire Anil Agarwal, boosted output of copper, zinc, lead, iron ore and aluminum in its Indian, Australian and Zambian units. Vedanta said annual production of iron ore during the year rose 34%; aluminium surged 15.4 % and refined zinc was up 4.9%.

“The financial year 2010 began with the developed markets in recession and commodity prices and industrial demand at multi-year lows. Emerging markets — especially India and China — proved more resilient to the economic downturn, with continued economic and metals consumption growth. The large and coordinated stimuli from governments globally has secured greater stability in financial markets and a return to economic growth. Commodity prices and industrial demand have recovered and we enter the 2011 financial year with much greater optimism,” Anil Agarwal, chairman of Vedanta Resources said in a statement.

During the year, Vedanta raised $4.2 billion of long-term capital through a mix of debt and equity to refinance debt maturities and for general corporate purposes. Gearing as on March 31, 2010, was 7.5%, net debt was $0.9 billion and the group’s cash position, including liquid investments, was $7.2 billion.

“We remain committed to retaining investment grade credit metrics,” Agarwal said.

Meanwhile, during the year the group repaid $1.2 billion of debt and raised long term funds totalling to $4.2 billion. This includes raising $2.1 billion through the issue of convertible bonds, $1.1 billion by issue of equity by its subsidiary Sterlite and $1.0 billion through issue of convertible bonds by its subsidiaries Sterlite and Sesa Goa.