It's been swings and roundabouts for the commodities giant Vedanta Resources. The group is gearing up to close a merger with its Indian branch this quarter, but was beset by falling production volumes in the first nine months of the year.
Vedanta has already received approval from all sets of shareholders to merge oil and gas exploration company Cairn India with Vedanta Limited, and the tie-up is now expected to complete within the first quarter of the 2017 calendar year.
Vedanta Limited already owns around 60 per cent of Cairn India and will give the indebted Vedanta parent group access to around $3.5bn of cash in the other firm.
In a production update released today, the London-listed, India-focused mining, oil and power firm posted a six per cent fall in daily production in its oil and gas output. Production fell to 201,286 gross barrels of oil equivalent per day in the nine months to 31 December.
At its major mining arm, Zinc India, mined metal content of zinc, lead and silver fell 15 per cent to 595,000 tonnes, down from 700,000 in the first nine months of 2016. However, mined metal production was up 21 per cent year-on-year and 44 per cent when compared with the second quarter, due to higher volumes from its Rampura Agucha open cast mine.
Its Zambia copper output fell 16 per cent over the first nine months of the year, to 79,000 tonnes, though its power sales grew by eight per cent and aluminium production rose 23 per cent to 860,000 tonnes.
Vedanta's share price was up 1.5 per cent to 1,031p in afternoon trading. The slight recovery in many metals prices has helped drive the company's share price in a neat upward-curve over the last year.
"We have made substantial operational progress during the quarter with the enhancement of production from Zinc India and the ramp up of our aluminium capacities," said Vedanta's chief executive Tom Albanese.
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"Though we had some operational challenges at Copper Zambia during the quarter, we continue to be focused on the turnaround of this asset. We will continue our sustained focus on costs alongside rising capacity utilisations thus driving free cash flow growth."
First-half financial results at the firm showed group revenue had dipped 15 per cent to $4.9bn (£4bn), while earnings before interest, tax, depreciation and amortisation fell four per cent to $1.2bn.