Revenue and earnings improve at Vedanta

Vedanta Resources posted its preliminary results for the year to 31 March on Wednesday, reporting a 7% increase in revenue to $11.5bn, which the board said was driven by firmer commodity prices and volume ramp-up.

The FTSE 250 company said EBITDA increased 37% to $3.2bn, with its adjusted EBITDA margin improving to 36% from 28% year-on-year, which was also put down to firmer commodity prices as well as operational efficiencies.

Free cash flow, post capital expenditure, was $1.5bn, down from $1.8bn.

Excluding one-time working capital initiatives, free cash flow stood at $1.4b, rising from $0.9bn.

Gross debt was $18.2bn at year-end, rising from $16.3b, which the board said was on account of temporary borrowings at HZL of $1.2bn for a special dividend payment.

Gross debt reduced by $1.4bn since year-end, the board claimed.

Net debt was $8.5bn, rising from $7.3bn), which was reportedly driven by dividends paid to minorities and the associated dividend distribution tax.

The board confirmed the Vedanta Limited and Cairn India merger had completed.

Underlying profit per share was put at 1.1 cents, swinging from a loss of 131.9 cents in 2016.

Vedanta announced a final dividend of 35 cents per share, making for a total dividend of 55 cents per share and a dividend yield of 6.5%.

“We delivered a strong set of results this year and took important steps towards achieving our strategic objectives,” said chairman Anil Agarwal.

“We reached record production levels across several of our businesses and I am confident of continued successful ramp ups from our world-class assets.”

Agarwal said an important milestone for the company during the year was the completion of the merger of Vedanta Limited and Cairn India, adding that its simplified group structure would support strong shareholder returns.

“We remain committed to a consistent strategy and de-levering the balance sheet, and look ahead to FY 2018 in a stronger financial position and with more confidence than ever.”