LONDON (Alliance News) - Vedanta Resources PLC Thursday said it has slashed its dividend by more than half after the multi-commodity miner failed to escape the red during the last financial year as significantly lower commodity prices offset record levels of production in some of its divisions.
Vedanta said its dividend for the year ended March 31 would be 30.0 cents per share, more than half the 63.0 cents per share paid the year before, which the company's chairman said was a "prudent decision" that has been taken to weather the current commodity rout.
Although Vedanta still made a hefty loss of USD4.98 billion, it was narrower than the USD5.64 billion loss made in the previous year as revenue declined to USD10.73 billion from USD12.87 billion as a result of volatile and lower commodity prices, which also impacted its margins.
Stripping out exceptional items, which fell to USD5.21 billion from USD6.74 billion, Vedanta did manage to squeeze out a pretax profit of USD226.1 million in the year, but that has plummeted from USD1.10 billion in the previous year.
Those special items were mainly booked against foreign exchange losses.
"We achieved record production in zinc, lead, silver at Zinc India; Aluminium, Power and Copper cathodes. There is a huge opportunity for Vedanta to support India's future resources demand, which we are well placed to seize with our combination of low cost and well-invested assets. We look to the future with cautious optimism," said Chairman Anil Agarwal.
Vedanta managed to significantly reduce its net debt to USD7.32 billion from USD8.46 billion as free cashflow increased in the year, but the company's net gearing has risen to 52% from 41% due to the non-cash impairments booked in the year and the effect that had on the net assets.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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