Vedanta Resources first half production rises in most commodities

Vedanta Resources posted a rise in first half production across most of its commodities, as it said net debt at the end of the quarter is expected to be below $8bn and expressed confidence that it will meet its covenants as at the end of September.

The company said second quarter oil and gas production rose 6% year-on-year to 205,361 barrels of oil equivalent per day. First half production averaged 207,538, up a touch from 206,125.

In India, zinc production came to 240,000 tonnes, which was a 13% rise on the year, while cost of production excluding royalties dropped to $771 per tonne from $799 in the previous year. First half production rose 26% from a year ago to 472,000 tonnes.

International zinc production came to 63,000 tonnes, down 20% on the year and bringing first half output to 133,000 tonnes, down 18%.

Copper cathode production from India and Australia fell 6% year-on-year to 94,000 tonnes in the second quarter. For the first half, production was up 16% on the year at 193,000.

Copper production from Zambia was up 39% in the second quarter to 47,000 tonnes, while for the first half, it rose 19% to 90,000 tonnes.

Total second quarter aluminium output came to 233,000 in the second quarter, up 5% on the year, with first-half production up 9% to 464,000.

Chief executive officer Tom Albanese said: “Our diversified asset portfolio has delivered a strong operating performance during the quarter, including record production from our tier-1 zinc mines and lower costs at Copper-Zambia.

“We are continuing to drive efficiency improvements and optimise opex and capex across the business. While the near-term market outlook is challenging, we believe we have the right mix of commodities to benefit from future demand in India and globally.”

Vedanta said that during the quarter, several initiatives and programmes to generate cash savings, including a reduction of working capital, were implemented across its businesses.

At 0818 BST, Vedanta shares were up 9.1% at 578p.