Slide 1: Vedanta Limited Q3 FY2016 Results
Vedanta Limited (formerly known as Sesa Sterlite Ltd.) Q3 FY2016 Results 28 January 2016 Results conference call details are on the last page of this document
Slide 2: Cautionary Statement and Disclaimer
Cautionary Statement and Disclaimer The views expressed here may contain information derived from statements. We do not undertake to update our forward-looking publicly available sources that have not been independently verified. statements. We caution you that reliance on any forward-looking statem
Slide 3: Strategic Update
Strategic Update Tom Albanese Chief Executive Officer
Slide 4: Safety and Sustainability
Safety and Sustainability Safety LTIFR (per million man-hours worked) 2 fatalities in Q3 FY2016; 8 fatalities in FY2016 (YTD) LTIFR for 9M 2016 higher due to shift to ICMM 2014 Health & Safety methodology Focus on bringing in a culture of Zero-Harm 0.52 0.52 Making Better Risk Decisions (MBR
Slide 5: Q3 FY2016 Results Highlights
Q3 FY2016 Results Highlights Operations EBITDA Mix Zinc-India: Strong refined metal production and record quarterly refined silver production of 116 tonnes Q3 FY2016 Q3 FY2015 Oil & Gas: Stable production with 19kboepd contribution from 1% 2% Mangala EOR; Rajasthan water flood opex continue to i
Slide 6: Relentless focus on opex, capex and FCF optimisation
Relentless focus on opex, capex and FCF optimisation Pragmatic decisions under current market condition Maintained 1st/2nd quartile cost positions across major businesses New BALCO 300MW CPP unit replaced older 270MW unit: 300MW power cost Rs. 2.80/kwh vs. 270MW at Rs. 4.07/kwh Single stream o
Slide 7: Financial Update
Financial Update D.D. Jalan Chief Financial officer
Slide 8: Financial Highlights
Financial Highlights Continued cost and capex optimization, despite weak commodity price environment, resulted in: - EBITDA margin¹ of 30% in 9M FY2016 and 26% in Q3 - Positive FCF of Rs. 6,800 crore in 9M FY2016 Net debt - Lower by Rs. 1,300 crore in 9M FY2016, driven by operating cash flow and
Slide 9: EBITDA Bridge Q3 FY2016 vs Q2 FY2016
EBITDA Bridge Q3 FY2016 vs. Q2 FY2016 (In Rs. Crore) LME 598 Brent 205 Brent Discount 122 4500 Premiums 65 4,113 990 4000 Primarily due to DMF2 reversal in Q2 FY 2016 3500 72 182 235 8 53 68 3,212 35 3,115 93 3000 Market & Regulatory Operational Rs. (997) crore Rs. 97 crore 2500 2000 Q2 FY 16 LME, B
Slide 10: EBITDA Bridge 9M FY2016 vs 9M FY2015
EBITDA Bridge 9M FY2016 vs. 9M FY2015 LME 3,648 (In Rs. Crore) Brent 4,003 Brent Discount 295 Premiums 1,545 19,000 18,240 9,491 17,000 15,000 Pertaining to Primarily Royalty, RPO2, Zinc India & electricity duty & TSPL 13,000 energy cess 881 11,365 11,000 1,004 151 1,365 1,271 273 1,078 865 9,000 8,
Slide 11: Net Debt bridge for Q3 FY2016 and 9M FY2016
Net Debt bridge for Q3 FY2016 and 9M FY2016 Q3 FY2016 WC1 (2,033) (In Rs. Crore) Project Crs. (606) 32,000 642 30,267 30,000 1,931 2,639 (1,612) 28,000 27,105 (1,728) 1,198 92 26,000 24,000 FCF (pre capex) Rs. 609 crore 22,000 Opening Net Cash Flow from WC movements Debtors Cash Sustaining Project C
Slide 12: Balance Sheet and Maturity Profile
Balance Sheet and Maturity Profile Maturity Profile of Term Debt ($7.9bn) (as of 31st December 2015) Subsidiaries Standalone 1.7 1.6 1.6 1.1 1.2 0.6 0.6 0.6 0.5 0.7 0.6 0.3 1.1 0.9 1.0 0.6 0.5 0.5 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 & Later External term debt of $7.9bn ($4.6bn at Standalone an
Slide 13: Income Statement
Income Statement Depreciation & Amortization In Rs. Crore Q3 Q3 Q2 - Depreciation lower y-o-y due to realignment of FY’16 FY’15 FY’16 useful life of metal & mining assets in Q4 FY 2015 EBITDA 3,212 6,234 4,113 - Amortisation lower y-o-y due to impairment of goodwill, mostly in O&G business, in Q4
Slide 14: Business Review
Business Review Tom Albanese Chief Executive Officer
Slide 15: Oil & Gas
Oil & Gas Q3 Results Rajasthan Production at 170,444 boepd, up 1.4% q-o-q Aided by ramp-up in Mangala EOR contributing average production of 19 kboepd and 5 new infill wells at Aishwariya Average gas production from Raag Deep Gas (RDG) field at 28 mmscfd in Q3, well above our guidance of 25 mm
Slide 16: Zinc India
Zinc India Q3 Results RA Underground Mine Development Integrated saleable zinc production up 8% y-o-y at 206kt (in meters per month) Integrated saleable lead production up 42% y-o-y at 35kt 1,400 Record integrated silver production at 116 t; up 67% y-o-y 1,200 MIC for Q3 lower, in line with
Slide 17: Zinc International
Zinc International Q3 Results Skorpion production volumes impacted by planned maintenance shutdown of Refinery and subsequent delay in start-up Steady production improvement of 10% y-o-y in 9M FY2016 at BMM Lisheen mill production ended in December 2015 and final shipment made on 22 January 20
Slide 18: Aluminium
Aluminium Q3 Results Aluminium Costs and Margins (in $/t, for Q3 FY2016) Stable volumes at 500kt Jharsuguda-I, 245kt Korba-I and 80kt Korba-II smelters Q2: 1,591 169 75 1,835 (648) (680) (319) (90) 80 pots at Jharsuguda-II capitalised from 1st December $99/t Lower alumina production at 218kt g
Slide 19: Power
Power Q3 Results Q3 FY2016 Coal Mix (5.5mt) Jharsuguda 2400MW: 35% PLF due to lower demand TSPL: Unit-I availability of 87%; Unit-II capitalised on 1st December, availability of 81% 1st IPP unit of 300MW of 1200MW power plant at BALCO 22% capitalized 1 December; 65% PLF in Q3 100MW MALCO: Op
Slide 20: Other Assets: Iron Ore and Copper - India
Other Assets: Iron Ore and Copper - India Iron Ore Karnataka: Stable operations with 1.1mt production in Q3 Goa FY2016 Iron ore sales estimated at c. 3.5mt Transportation issues delayed ramp up in Q3 Pig iron production lower at 146kt Regulatory - engaged with the government on: Dupl
Slide 21: Strategic Priorities Remain Unchanged
Strategic Priorities Remain Unchanged Production Growth and Asset optimisation − Disciplined approach towards ramp up: positive FCF at each segment a top priority Delever the Balance Sheet − Optimise opex and capex to maximise cash flows − Deliver marketing and procurement cost savings of US$1.3bn −
Slide 22: Appendix
2 vedanta Appendix
Slide 23: Entity Wise Cash and Debt
Entity Wise Cash and Debt (in Rs. Crore) 31 March 2015 30 September 2015 31 December 2015 Company Debt Cash & LI Net Debt Debt Cash & LI Net Debt Debt Cash & LI Net Debt Vedanta Limited 37,636 840 36,796 39,394 2,194 37,200 42,645 3,055 39,590 Standalone Zinc India - 27,192 (27,192) - 30,404 (30,404
Slide 24: Debt Breakdown & Funding Sources
Debt Breakdown & Funding Sources Diversified Funding Sources for Term Debt of $ 7.9bn Debt Breakdown (as of 31 December 2015) (as of 31 December 2015) Short Term Loans - USD 3% Debt breakdown (in $bn) Money market External term debt 7.9 Instruments – INR 16% Bonds-INR Working capital 2.1 23% Inter c
Slide 25: EBITDA Bridge Q3 FY2016 vs Q3 FY2015
EBITDA Bridge Q3 FY2016 vs. Q3 FY2015 LME 1,899 (In Rs. Crore) Brent 965 Brent Discount 272 7100 Premiums 574 6,234 3,710 6100 5100 4100 221 3,212 372 193 96 132 202 344 3100 2,633 82 2100 Market & Regulatory Operational 1100 Rs. (3,601) crore Rs. 579 crore 100 Q3 FY 15 LME, Brent Input Currency Reg
Slide 26: Timeline: Merger of Vedanta Ltd and Cairn India Ltd
Timeline: Merger of Vedanta Ltd and Cairn India Ltd Event Completion BSE, NSE and SEBI approvals sought Q2 CY2015 BSE, NSE and SEBI approvals Q3 CY2015 Application to High Court in India Q4 CY2015 Vedanta plc posting of UK Circular Q1 CY2016 Vedanta plc EGM Q1 CY2016 Vedanta Limited and Ca
Slide 27: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas Q3 Q2 9M OIL AND GAS (boepd) % change % change FY 2016 FY 2015 FY2016 FY 2016 FY 2015 YoY YoY Average Daily Total Gross Operated Production (boepd)1 211,843 228,622 -7% 214,247 214,663 219,757 -2% Average Daily Gross Operated Production (boepd) 202,668 218,900 -7% 205,361
Slide 28: Segment Summary – Zinc India
Segment Summary – Zinc India Q3 Q2 9M Production (in ’000 tonnes, or as stated) % change % change FY 2016 FY2015 YoY FY 2016 FY 2016 FY2015 YoY Mined metal content 228 242 -6% 240 700 618 13% Refined Zinc – Total 206 196 5% 211 605 517 17% Refined Zinc – Integrated 206 192 8% 211 605 504 20% Refined
Slide 29: Segment Summary – Zinc International
Segment Summary – Zinc International Q3 Q2 9M Production (in’000 tonnes, or as stated) % change % change FY 2016 FY2015 FY 2016 FY 2016 FY2015 YoY YoY Refined Zinc – Skorpion 13 26 -49% 17 55 86 -35% Mined metal content- BMM 17 13 34% 16 48 44 10% Mined metal content- Lisheen 21 41 -50% 30 81 113 -2
Slide 30: Segment Summary – Aluminium
Segment Summary – Aluminium Q3 Q2 9M Particulars (in’000 tonnes, or as stated) FY 2016 FY2015 % change YoY FY 2016 FY 2016 FY2015 % change YoY Alumina – Lanjigarh 218 244 -10% 272 760 703 8% Total Aluminum Production 234 224 5% 233 697 648 8% Jharsuguda-I 131 133 -2% 130 392 403 -3% Jharsuguda-II 1
Slide 31: Segment Summary – Power
Segment Summary – Power Q3 Q2 9M Particulars (in million units) % change % change FY 2016 FY 2015 FY2016 FY 2016 FY 2015 YoY YoY Total Power Sales 2,934 2,663 10% 2,718 8728 7312 19% Jharsuguda 2400 MW 1,593 1,873 -15% 1,554 5,413 5681 -5% BALCO 270 MW 41 0 28 169 71 137% BALCO 600 MW 368 0% 158 526
Slide 32: Segment Summary – Copper India
Segment Summary – Copper India Q3 Q2 9M Production (in ’000 tonnes, or as stated) % change % change FY 2016 FY2015 FY 2016 FY 2016 FY2015 YoY YoY Copper - Mined metal content - - - - - - - Copper - Cathodes 89 99 -11% 94 282 266 6% Tuticorin power sales (million units) 40 164 -75% 118 334 483 -31% F
Slide 33: Segment Summary – Iron Ore
Segment Summary – Iron Ore Q3 Q2 9M Particulars (in million dry metric tonnes, or as stated) % change % change FY 2016 FY2015 FY 2016 FY 2016 FY2015 YoY YoY Sales 1.5 0.1 - 0.6 2.7 1.2 126% Goa1 0.6 - 0% - 0.6 - 0% Karnataka 0.9 0.1 - 0.6 2.1 1.2 78% Production of Saleable Ore 1.4 0 - 0.8 2.4 0.3 -
Slide 34: Sales Summary
Sales Summary Sales Volume Q3 FY2016 9M FY2016 Q3 FY2015 9M FY2015 Q2 FY2015 Zinc-India Sales Refined Zinc (kt) 204 602 194 513 217 Refined Lead (kt) 35 104 30 92 40 Zinc Concentrate (DMT) - - - - - Lead Concentrate (DMT) - - - - - Total Zinc (Refined+Conc) (kt) 204 602 194 513 217 Total Lead (Refin
Slide 35: Sales Summary
Sales Summary Sales Volume Q3 9M Q3 9M Q2 Q3 FY2016 9M FY2016 Q3 FY2015 9M FY2015 Q2 FY2016 Sales Volume FY2016 FY2016 FY2015 FY2015 FY2016 Power Sales (mu) Jharsuguda 2,400 MW 1,593 5,413 1,873 5,681 1,554 Iron-Ore Sales TSPL 839 1,922 502 523 693 Goa (mn DMT) 0.6 0.6 - - - BALCO 270 MW 41 169 0 71
Slide 36: Group Structure
Group Structure Vedanta Resources Plc Divisions of Vedanta Limited 79.4% 62.9% Sesa Iron Ore Konkola Sterlite Copper (Tuticorin) Copper Vedanta Ltd Power (2,400 MW Jharsuguda) Mines (KCM) Aluminium (Odisha aluminium and power assets) Subsidiaries of Vedanta Ltd 59.9% 64.9% 51% 100% 100% 100%
Slide 37: Results Conference Call Details
Results Conference Call Details Results conference call is scheduled at 6:00 PM (IST) on Thursday, 28 January 2016. The dial-in numbers for the call are given below: Event Telephone Number Earnings conference call on Mumbai main access 28 January 2016 India – 6:00 PM (IST) +91 22 3938 1017 Mumbai st