Vedanta Limited · NSE:VEDL
Vedanta — Sesa Sterlite — Q1 FY2015 Earnings Presentation
25 slides from Vedanta's earnings presentation, July 2014
Slide 1: Sesa Sterlite Q1 FY2015 Results Presentation
SS sesasterlite a vedanta company Sesa Sterlite Limited Q1 FY2015 Results Presentation July 2014
Slide 2: Adjusted proforma basis of presentation
The Sesa Sterlite merger and the Vedanta Group consolidation was completed in August 2013, hence Q1 FY 2015 performance has been compared with the adjusted proforma numbers of Q1 FY 2014. The company has drawn the adjusted proforma account for Q1 FY 2014 to indicate the performance during the period
Slide 3: Agenda
Overview • Tom Albanese, CEO Operational Update • Tom Albanese, CEO Financial Update • DD Jalan, CFO Q&A • Management Team
Slide 4: Overview
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Slide 5: Q1 FY2015 highlights
• • ¹ • • • • • • • • 1. Excludes custom smelting at Zinc and Copper India operations
Slide 6: CEO's Priorities
CEO’s Priorities DW sesasterlite Aluminum Smelter, Jharsuguda, India Operational excellence @ Improve business performance: — Aluminium: Operationalise remaining smelter capacity and work on bauxite sourcing — Iron Ore: Restart operations in Goa @ Enhance performance of well-performing assets — Zinc
Slide 7: Minority Buyout, Aluminium, Power, Oil & Gas, Iron Ore policy updates
Minority • Divestment of Government stake in HZL and BALCO approved Buyout • Valuers appointed by the Government for HZL and BALCO transactions • Working with Odisha State Government for bauxite allocation Aluminium • Working with State Government to use power from 2,400 MW Jharsuguda power plant fo
Slide 8: Gaining momentum with our strategic priorities
Gaining momentum with our strategic . priorities sesa sterlite Underground mine development at Rampura Agucha progressing well irst phase o Korba-Il smelter commenced production — pots commissioned during the quarter «Generate postive tree cash fw rom al businesses «# Utise cash flows to dedever = R
Slide 9: Business Performance
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Slide 10: Oil & Gas
Oil & Gas sesa sterlite avedanta company Production Rajasthan production in line with FY15 guidance Rajasthan Exploration Established 1.2bn boe of hydrocarbons in-place — Anadditional ~0.6bn boe has been drilled out Extended a significant existing gas play, with multi- TCF potential, in and around t
Slide 11: Zinc-Lead-Silver
Zinc-Lead-Silver sesa sterlite avedanta company Zinc India Mine Development + Rampura Agucha and SK shaft project progressing well + Exploring further deepening of RA mine open pit: Mine designing & planning in progress Operations * Mined & integrated production lower, in line with mine plan * COP i
Slide 12: Goa, Pig Iron & Met Coke, Liberia
• • Goa • • • Pig Iron & Met Coke • Liberia • • •
Slide 13: Copper - India/Australia
Copper - India/Australia sesa sterlite Copper India Copper-India/Australia Q1 FY2014 Q1 FY2015 * Completed planned maintenance shutdown in 23 days Mined Metal - Australia (kt) 6 - Smelter successfully ramped-up Copper Cathodes- India (kt) 16 * Conversion cost impacted primarily due to lower volume *
Slide 14: Aluminium
Aluminium sesa sterlite avedanta company Operations + Stable aluminium production + Lanjigarh refinery operating at 93% utilisation + Lower half cost positioning, without captive bauxite — BALCOCOP high due to further tapering of coal linkage * c. $450/t of realisation over LME, vs. c. $350/t in Q1
Slide 15: Power
Power — 3S — —4 sesa sterlite avedanta company Operations * 2,400 MW Jharsuguda power plant : — PLF higher at 45% as compared with 36% in Q4 FY14 — COP lower on account of temporary improved coal mix Projects * 1,980 MW Talwandi Sabo power plant — Reliability run of the first 660 MW unit planned dur
Slide 16: Financial Performance
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Slide 17: Financial performance summary
• • ² Notes: Q1 FY2014 numbers are on proforma basis 1. Excludes custom smelting at Copper and Zinc-India operations. 2. EBITDA annualized 3. Based on profit for the period after excluding special items and other gains and losses, and their resultant tax and minority interest effects.
Slide 18: EBITDA bridge: controllable and non-controllable
Non-Controllable Rs. 515 Crore 6,600 6,400 214 6,200 582 197 6,000 109 219 5,800 238 165 5,600 61 214 5,400 5,200 5,670 5,479 Controllable 5,610 5,000 Rs. (323) Crore 4,800 Notes:. 1. Higher exploration cost and change in ESOP valuation at Cairn India 2. Higher income from value added business at Ir
Slide 19: Income statement items: Q1 FY2015 vs Q1 FY2014
Proforma • Higher other income at Zinc India and Rs. Crore or as stated Q1 FY2015 Q1 FY2014 Cairn India, driven by FMP maturities EBITDA 5,670 5,479 during the quarter. Finance Cost 1,537 1,571 Other Income 1,139 600 • Higher depreciation primarily on account Depreciation 1,544 1,303 of change in me
Slide 20: Summary: Gaining momentum with our strategic priorities
Summary: Gaining momentum with our strategic priorities sesa sterlite avedanta company sesa sterlite Key Strategic Priorities rerr remain unchanged eS = Disopined cape locaton: Lwsrsk and phased development ‘sustained operational excolence od costefsenees Actin eonagamont wi Coverenis f AS Productio
Slide 21: Appendix
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Slide 22: Debt maturity profile
Standalone Subsidiaries 2.3 1.1 1.5 1.2 1.0 0.4 0.8 0.8 0.4 0.5 0.2 1.2 0.4 1.1 0.8 0.4 0.5 0.6 9M FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 & Later • • • • • •
Slide 23: Free Cash Flow and Capex
Free Cash Flow-FY³ M&M Capex O&G Capex² 3.0 1.9 1.9 1.4 1.2 1.2 1.0 0.6 0.6 0.8 0.7 0.6 0.4 Proforma FY2014 FY2015e FY2016e FY2017e
Slide 24: Entity wise Debt and Cash
Entity wise Debt and Cash sesa sterlite Net Debt Summary ($ Mn) 30 June 2014 31 March 14 Company Debt Cash & LI Cash & LI Sesa Sterlite Standalone 6,636 Zinc India - Zinc International - Cairn India 59 BALCO 845 Talwandi Sabo 882 Cairn acquisition SPV" 4,720 Others * Notes: Debt numbers at Book Valu
Slide 25: Group structure: Vedanta Resources and Sesa Sterlite divisions
Vedanta Resources Plc Divisions of Sesa Sterlite 79.4% 60.4% Iron Ore (Sesa Goa) Konkola Copper Smelting (Tuticorin) Copper Sesa Sterlite Mines (KCM) Power (2,400 MW Jharsuguda) Aluminium (VAL aluminium and power assets) Subsidiaries of Sesa Sterlite 59.9% 64.9% 51% 100% 100% 100% 100% 100%