Hindustan Zinc reported 6% increase in its bottomline to Rs 1581.34 crore for the quarter ended June 2012 compared to corresponding previous year quarter led by 60% jump in other income to Rs 574.30 crore and a 410 bps fall in effective tax rate while its topline fell 3% to Rs 2747.71 crore. During the quarter, the positive impact of higher Lead-Silver volumes and rupee depreciation was offset by lower Zinc volume, LME prices of Zinc & Lead and LBMA (London Bullion Market Association) price of Silver.
Segment wise Refined Zinc and lead revenues fell 12% to Rs 2253.23 crore while Silver revenues rose 70% to Rs 388.20 crore and wind energy revenues jumped 91% to Rs 71.24 crore. Refined zinc and lead segment PBIT fell 31% to Rs 862.71 crore while Silver PBIT rose 82% to Rs 351 crore. Wind Energy segment PBIT was higher at Rs 38.96 crore compared to Rs 15.53 crore in the corresponding previous year period.
During Q1FY'12 Zinc LME prices fell 14% to USD 1928 per tonne on a y-o-y basis and 5% on a sequential basis. LME Lead prices fell 23% to USD 1974 per tonne on a y-o-y basis and 6% on a sequential basis. Silver prices fell 26% to USD 28.3/oz on a y-o-y basis and 13% on a sequential basis.
Mined metal production fell 1% in Q1FY'13 to 187000 tonne on a y-o-y basis. Mined metal output at Sindesar Khurd mine increased by around 60% from a year ago, offsetting lower output from Rampura Agucha mine. Production in H1 FY2013 is expected to be marginally lower than H1 FY2012, but will be more than made up in H2 FY2013.
Refined Lead production and refined Silver production in Q1 FY2013 increased by 91% and 75% from a year ago, to 31,000 tonne and 82000 tonne respectively. The increase was primarily due to ramp-up of SK mine and stabilization of the new Lead & Silver refining capacities. Refined Zinc production was 161,000 tonne down by 16%.
During the first quarter of FY 2013, we ramped up Sindesar Khurd mine (SKM) resulting in a strong 70%+ increase in integrated Lead and Silver production. Ore production at SKM has increased to more than 1.5 times from a year ago. SKM's steady ramp-up and low cost of production reflect high mechanisation of our operations, which will be emulated at all our future underground mining projects, said Mr. Agnivesh Agarwal, Chairman of Hindustan Zinc.
The Zinc COP, excluding royalty, during the quarter was Rs. 45,759 per MT ($844), compared to Rs. 39,117 ($874) in the corresponding prior quarter. The increase was due to higher prices of consumables due to Rupee depreciation and lower metal production.
OPM decreased 380 bps to 52% resulting in 10% fall in operating profit to Rs 1428.56 crore as consumption of raw materials as a percentage of net sales (net of stock adjustment) rose 120 bps to 2.0%, Consumption of stores and spares rose 130 bps to 9.9%, mining royalty rose 40 bps to 7.5%, other mining and manufacturing expenses rose 250 bps to 9.4%, employees expenses rose 80 bps to 5.4% and other expenses rose 70 bps to 3.8% marginally offset by 90 bps fall in power and fuel cost to 9.9%.
Other income jumped 60% to Rs 574.30 crore while interest cost was Rs 12.88 crore compared to Rs 6.64 crore. Depreciation was up 29% to Rs 173.38 crore. PBT before EO as a result inched up 1% to Rs 1816.60 crore. The company had an EO expenditure of Rs 4.42 crore in Q1FY'12 compared to nil in the corresponding previous year period related to amount incurred on Voluntary Retirement Scheme. PBT after EO was up 1% to Rs 1816.10 crore. Effective rate of tax fell 410 bps during the quarter to 13%. PAT as a result rose 6% to Rs 1581.34 crore.
For year ended March 2012, HZL has posted 14% Y-o-Y increase in net sales to Rs 11405.31 crore on the back of higher sales volume. The OPM of the company decreased 270 bps to 53.2%. The operating profit was up 8% Y-o-Y to Rs 6069.46 crore. Other income jumped 78% to Rs 1542.83 crore while interest cost fell to Rs 13.95 crore compared to Rs 18.28 crore in the corresponding previous year quarter. Depreciation was up 29% to Rs 610.67 crore. PBT before EO as a result rose 17% to Rs 6987.67 crore. The company had an EO expenditure of Rs 43.13 crore compared to Rs 21.16 crore in the corresponding previous year period related to amount incurred on Voluntary Retirement Scheme. PBT after EO rose 17% to Rs 6944.54 crore. Effective rate of tax rose by 260 bps to 20.4%. PAT as result grew 13% to Rs 5526.04 crore.
As of 30 th June 2012, promoters holding remain unchanged at 64.92% compared to previous quarter.
The scrip is currently trading at Rs 119.80.
Hindustan Zinc: Results
Hindustan Zinc Segment Results