12th Apr 2005 07:00
Vedanta Resources PLC12 April 2005 12th April 2005 Vedanta Resources plc Production report for the twelve months ended 31 March 2005 Set out below is the production data for the financial year ended 31 March 2005.Financial results for this period will be released on 2 June. Summary Existing operations produced well in the second half with a strong fourthquarter in several areas, notably aluminium. High input costs, mentioned at theinterim results, have continued to be a feature. Production from the Zambianoperations is included for the first time. There is a lot of opportunity atKonkola but there is also much work to be done on improving output and costs.The projects remain on track with zinc likely to be commissioned shortly. Unaudited Production summary Twelve Months Change 2nd Half Change ('000 t) % ('000 t) % ------------------- ------- ------------------- -------- 2004-05 2003-04 2004-05 2003-04---------------------------------------------- ------------------------------- Alumina 278,599 269,778 4% 148,524 136,600 9%Aluminium 135,949 129,317 5% 70,159 64,317 9%IndiaCopper - Cathode 171,992 178,654 -4% 94,590 85,754 10%Copper - Rod 125,295 122,703 2% 72,041 63,503 13%Zambia -Copper - Cathode 67,547 - 67,547Zinc - minedmetal content 354,629 330,555 7% 187,447 178,596 5%Zinc - refined 212,279 220,664 -4% 108,721 111,264 -2% Operational overview Aluminium:Both BALCO and MALCO saw higher output in the fourth quarter, with production inthe second half almost 7% above the first half, leading to a 5% increase overthe year. This was the result of improved management of the smelter process andmore stable power production. Copper: IndiaCathode production in the second half was at peak capacity, evenly spread overthe third and fourth quarters, with an increase of 22% over the first half. Theproduction benefited from an improvement in operational efficiencies and higherplant availability, which had been affected in the first half of the year by theplanned maintenance shut down and flooding at the refinery during the monsoon.Cathode production finished the year just 4% below 2004. ZambiaThe data for Konkola Copper Mines is based on 5 months of production, from thedate of acquisition. Initial assessments indicate issues concerning plantavailability, process management and maintenance. These are being addressed by aseries of actions, following the appointment of a new CEO for our Zambianoperations. The immediate focus is to bring about stability and consistency inoperations. We are taking all necessary measures to improve these operations andremain positive about the potential to reduce costs and improve production. Zinc:The mining output has improved considerably and all the mines have performedwell. Rampura Agucha in particular did better than the previous year due tode-bottlenecking. This is reflected in an increase in mined metal content of 7%over the year. The smelter production at Chanderiya is 4% lower than theprevious year due to inconsistent qualities of metcoke, caused by short supply,which impacted the production process. Sales of zinc metal at about 290,000 MT will be about 12% higher than 2003-4,and well above the production number shown here, due to the availability ofadditional tonnage from tolling activities and stock reduction. Pricing & Costs Prices for aluminium, zinc and copper have continued to be firm. TC/RC's havealso improved and some impact of the increasing TC/RCs have come into the secondhalf results though their influence will be more pronounced in the financialyear 2005-6. As reported, tariffs on metal prices were reduced by the Governmentof India in July 2004 and again in February 2005, and now stand at 10% foraluminium, copper and zinc. These cuts have reduced the prices realised on metalsales. Input prices, particularly for energy products, have remained a pressurethroughout the year. Update on expansions Vedanta is progressing well on its expansion programme to increase productionof all metals. Over $1bn of the anticipated $2.2bn has been spent to date. Aluminium:The work on the new 250,000 tpa aluminium smelter and power plant at Korba isprogressing well. Trials on a few smelter pots have started, using third partyalumina and power to stabilize the process and to accelerate use of thetechnology. The commissioning of the project will start, in phases, from thesecond quarter of this financial year, and remains on track for fullcommissioning in March 2006. Alumina:Vedanta is building a new 1mtpa alumina refinery in the State of Orissa. Therefinery is due to complete in March 2007 and remains on track and withinbudget. Public interest submissions regarding environmental clearances arecurrently being addressed. Copper:The expanded facilities at Tuticorin, to take production from capacity of180,000 tpa to 300,000 tpa, are still awaiting permission. Zinc:The expansion at Rampura Agucha mine is complete and commissioning trials aregoing on at present. At the captive power plant, both the machines have beensynchronised and we are already producing power to meet the current needs. Theroaster at Chanderiya smelter has been commissioned and other sections of theplant are under testing. -ends- For further information, please contact: John Smelt, Head of Investor RelationsPeter Sydney-Smith, Finance DirectorVedanta Resources plcwww.vedantaresources.com Tel: +44 207 659 4734 +44 787 964 2675 James MurgatroydLucy SlaterFinsbury Tel: +44 207 251 3801 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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