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Vedanta reports Q4 net loss of Rs 12,521 cr due to one-time impairment

The profit was impacted by exceptional loss of Rs 17,132 crore in Q4 FY20 due to impairment of assets at oil & gas, copper and iron ore business.

Revenue from operations declined 16% to Rs 19,513 crore in Q4 March 2020 from Rs 23,092 crore in Q4 March 2019. Revenue fell due to lower commodity prices further impacted by COVID-19, lower volumes at zinc, oil & gas, steel business and lower power sales at TSPL partially offset by higher volume at aluminium and iron ore business, and rupee depreciation.

Pre-tax loss stood at Rs 15,269 crore in Q4 FY20 as against pre-tax profit of Rs 4,104 crore in Q4 FY19. Net current tax expense slumped 52.87% to Rs 320 crore in Q4 FY20 over Q4 FY19.

Consolidated EBITDA declined 23% to Rs 4,844 crore in Q4 FY20 from Rs 6,330 crore in Q4 FY19. EBITDA margin deteriorated to 28% in Q4 FY20 from 31% in Q4 FY19. EBITDA was lower primarily due to lower commodity prices further impacted by COVID-19, lower volume zinc, oil & gas and steel business, partially offset by higher sales at iron ore business, improved cost of production at aluminium & steel business, lower input commodity prices and rupee depreciation.

Vedanta had cash and liquid investments of Rs 37,914 crore in March 2020. Net debt was at Rs 21,273 crore on 31 March 2020, lower by Rs 5,683 crore y-o-y, primarily due to the repayment of debt and unwinding of working capital partially offset by dividend payment by Cairn India Holdings Limited (CIHL).

Vedanta reported a consolidated net loss of Rs 6,664 crore in fiscal year 2020 (FY20) as against a net profit of Rs 7,065 crore in fiscal year 2019 (FY19). Exceptional loss for FY20 stood at Rs 17,386 crore due to impairment of assets at oil & gas, triggered majorly due to significant fall in crude oil prices primarily consequent to the outbreak of COVID-19, partially offset by renewable purchase obligation (RPO) liability true up at aluminium, and interest accrued on power debtors at Talwandi Sabo Power Limited (TSPL) in line with positive Supreme Court order.

Revenue from operations declined 8% to Rs 83,545 crore in FY20 over FY19. Revenue was impacted by subdued commodity prices, lower volume at oil & gas, zinc India and lower power sales at TSPL. This was partially offset by higher volume from Gamsberg operations, higher sales at aluminium, iron ore and steel business, past exploration cost recovery at oil & gas business and rupee depreciation.

Shares of Vedanta rose 0.96% at Rs 105.3 on Friday.

Vedanta is a diversified natural resources player, with a significant presence in zinc, oil and gas, copper, aluminium, iron ore, and power.