Hindustan Zinc Limited (HZL) today announced its unaudited results for the third quarter (Q3) and nine months ended 31 December 2012.
On the occasion, Agnivesh Agarwal, Chairman of HZL said, “I am pleased to announce that the Board of Directors has approved the next phase of growth projects, which will deliver superior performance in future and create long-term value for stakeholders”.
Agarwal mentioned, the Zinc metal cost, without royalty, during the quarter was Rs. 44,900 per MT ($829), 11% higher in INR and 6% in USD, compared with the corresponding prior quarter.
The positive impact of operational efficiencies and lower coal prices was more than offset by increase in commodity prices, higher excavation & lower by-product credits. Mined metal production in Q3 was up 11% at an all time high of 233kt, compared with the corresponding prior quarter. Refined Lead production in Q3 was 32kt up 11% and Refined Silver production was 117t up 103%, as compared with the corresponding prior quarter.
This was mainly attributable to higher volume of custom production, as the mined metal production improved progressively during the quarter, the Chairman affirmed.
Revenues for Q3 were up 14% at Rs. 3,140 Crore, compared with the corresponding prior quarter. The increase was primarily due to higher Lead-Silver volumes, further supported by improved LME/LBMA prices & INR depreciation. Net profit for the quarter was higher by 27% at Rs. 1,613 Crore.
The Board of Directors has approved the next phase of growth plan. HZL has been actively conducting exploration, which increased net Reserve and Resource across all mines to 332.3 million tonnes in FY2012. Based on long-term evaluation of assets and in consultation with mining experts, the Company has finalised the next phase of growth plan, which will involve sinking of underground shafts and developing underground mines.
The plan comprises of developing a 3.75 mtpa underground mine at Rampura Agucha and expanding Sindesar Khurd mine from 2.0 mtpa to 3.75 mtpa, Zawar mines from 1.2 mtpa to 5.0 mtpa, Rajpura Dariba mine to 1.2 mtpa and Kayad mine to 1.0 mtpa. It will also involve opening up of a small new mine at Bamnia Kalan in Rajpura Dariba belt. The growth plan will increase mined metal (MIC) production capacity to 1.2 mtpa.
The mines will be developed using best-in-class technology and equipment and in consultation with leading global mine experts, ensuring highest level of productivity. The projects will be completed in six years and benefit of growth projects will start flowing in from third year, even as projects will continue till FY18-19. Annual capital expenditures for these projects will average USD 250 million a year over next six years.
As the company follows conservative Investment Policy and invests in high quality debt instruments. As on 31 December 2012, the Company had cash and cash equivalents of Rs. 19,282 Crore, out of which Rs. 10,626 Crore was invested in debt mutual funds, Rs. 1,712 in bonds and Rs. 6,923 Crore were in fixed deposits with scheduled banks.