Hindustan Zinc’s robust volumes & cost reduction drive PAT at INR 2,028 Cr, up 17% QoQ
“PAT at INR 2,028 Cr, up 17% q-o-q on the back of consistent volume growth & cost reduction.”
Key Highlights :
Ranked highest globally in S&P Sustainability Assessment in Metals and Mining sector
Quarterly Revenue, EBITDA and PAT up sequentially by 8%, 14% and 17% respectively
Silver production at 197 MT for Q3 FY24, up 22% y-o-y
Highest ever nine months’ mined metal & silver production, driving the attainment of industry leading CAGR and advancing towards achieving annual guidance
Lowest zinc cost of production in last 10 quarters at US$ 1,095 per MT & 4th consecutive quarter of cost reduction
Chennai: Hindustan Zinc Limited, the leading global integrated producer of zinc, lead and silver, reported its results for the third quarter and nine months ended December 31, 2023.
Commenting on the performance, Mr Arun Misra, CEO, said: “With our consistent focus on operational excellence, Hindustan Zinc delivered record nine-months mined metal and silver production to leverage the elevated silver price opportunities. The Company’s sustainable operational progress is reflected in its industry leading compounded annual production growth rate supplemented by safe practices. On sustainability front, advancing towards our decarbonisation mission, Hindustan Zinc has initiated the deployment of electric and LNG vehicles in its operations for inter-unit movements and finished goods transportation, thereby reducing the Scope 3 emissions. I am also happy to report that Hindustan Zinc has been ranked highest in the S&P Global Corporate Sustainability Assessment (CSA) 2023 among 238 companies with the score of 85 out of 100 under the metals and mining sector, underscoring our dedication to sustainable and responsible mining practices.”
Mr Sandeep Modi, CFO, said: “This marks Hindustan Zinc’s fourth consecutive quarter of consistent cost improvement and the lowest cost in last 10 quarters. We continue to remain focused on cost optimisation, operational efficiencies, working capital management, digital improvements and shareholder value maximisation. During the quarter, Hindustan Zinc has delivered steady margin of c.49%, bolstered by operational milestones and cost reduction. The Company is now in the first decile of the global zinc mining cost curve preserving its cost leadership globally and targets to achieve its designed cost in the near future.”
Financial Summary Standalone
INR. Crore or as stated
Particulars
2024
2023
9M
Q3
Q2
Change
Q3
Change
2024
2023
Change
Sales1
Zinc
4,502
4,034
12%
5,631
-20%
13,204
18,319
-28%
Lead
1,038
1,117
-7%
884
17%
3,115
2,863
9%
Silver
1,413
1,297
9%
983
44%
4,008
3,171
26%
Others
357
344
4%
368
-3%
1,057
1,236
-14%
Total
7,310
6,792
8%
7,866
-7%
21,384
25,589
-16%
EBITDA
3,560
3,120
14%
3,717
-4%
10,040
13,385
-25%
Profit After Taxes
2,038
1,737
17%
2,157
-6%
5,745
7,931
-28%
Earnings per Share
4.82
4.11
17%
5.10
-6%
13.60
18.77
-28%
(INR, not annualised)
Mined Metal Production (‘000 MT)
271
252
8%
254
7%
780
761
2%
Refined Metal Production (‘000 MT)
Total Refined Metal
Zinc
203
185
10%
210
-4%
597
606
-1%
Saleable Lead
56
57
-1%
46
21%
163
157
4%
Zinc & Lead
259
241
7%
257
1%
760
762
-0%
Saleable Silver2 (in MT)
197
181
9%
161
22%
556
532
5%
Wind Power (in million units)
55
157
-65%
50
11%
333
324
3%
Refined Metal Sales (kt)
Zinc (kt)203
185
10%
210
-4%
596
605
-2%
Lead (kt)56
57
-2%
46
21%
163
157
4%
Silver (MT)197
181
9%
161
22%
556
532
5%
Zinc CoP without Royalty (INR/MT)
91,180
93,981
-3%
1,06,203
-14%
94,448
1,01,312
-7%
Zinc CoP without Royalty ($/MT)
1,095
1,137
-4%
1,293
-15%
1,142
1,272
-10%
Zinc LME ($/MT)
2,498
2,428
3%
3,001
-17%
2,483
3,386
-27%
Lead LME ($/MT)
2,123
2,170
-2%
2,098
1%
2,137
2,088
2%
Silver LBMA ($/oz.)
23.2
23.6
-2%
21.2
10%
23.6
21.0
13%
USD-INR (average)
83.25
82.68
1%
82.14
1%
82.70
79.64
4%
Including other operating income
Silver occurs in Lead & Zinc ore and is recovered in the smelting and silver-refining processes.
Financial Summary Consolidated
INR. Crore or as stated
Particulars
2024
2023
9M
Q3
Q2
Change
Q3
Change
2024
2023
Change
Sales1
Zinc
4,502
4,033
12%
5,631
-20%
13,203
18,319
-28%
Lead
1,038
1,117
-7%
884
17%
3,115
2,863
9%
Silver
1,413
1,297
9%
983
44%
4,008
3,171
26%
Others
357
344
4%
368
-3%
1,057
1,236
-14%
Total
7,310
6,791
8%
7,866
-7%
21,383
25,589
-16%
EBITDA
3,559
3,122
14%
3,717
-4%
10,040
13,382
-25%
Profit After Taxes
2,028
1,729
17%
2,156
-6%
5,721
7,928
-28%
Earnings per Share
4.80
4.09
17%
5.10
-6%
13.54
18.76
-28%
(INR, not annualised)
Mined Metal Production (‘000 MT)
271
252
8%
254
7%
780
761
2%
Refined Metal Production (‘000 MT)
Total Refined Metal
Zinc
203
185
10%
210
-4%
597
606
-1%
Saleable Lead
56
57
-1%
46
21%
163
157
4%
Zinc & Lead
259
241
7%
257
1%
760
762
-0%
Saleable Silver2 (in MT)
197
181
9%
161
22%
556
532
5%
Wind Power (in million units)
55
157
-65%
50
11%
333
324
3%
Refined Metal Sales (kt)
Zinc (kt)203
185
10%
210
-4%
596
605
-2%
Lead (kt)56
57
-2%
46
21%
163
157
4%
Silver (MT)197
181
9%
161
22%
556
532
5%
Zinc CoP without Royalty (INR/MT)
91,180
93,981
-3%
1,06,203
-14%
94,448
1,01,312
-7%
Zinc CoP without Royalty ($/MT)
1,095
1,137
-4%
1,293
-15%
1,142
1,272
-10%
Zinc LME ($/MT)
2,498
2,428
3%
3,001
-17%
2,483
3,386
-27%
Lead LME ($/MT)
2,123
2,170
-2%
2,098
1%
2,137
2,088
2%
Silver LBMA ($/oz.)
23.2
23.6
-2%
21.2
10%
23.6
21.0
13%
USD-INR (average)
83.25
82.68
1%
82.14
1%
82.70
79.64
4%
Including other operating income
Silver occurs in Lead & Zinc ore and is recovered in the smelting and silver-refining processes.
Operational Performance
Mined metal production for the quarter was 271 kt, up 8% sequentially and 7% y-o-y, driven by higher ore production at Rampura Agucha and Sindesar Khurd mines, further supplemented by improved mined metal grades year on year. 9M FY24 mined metal production stood at 780 kt, up 2% y-o-y on account of improved mined metal grades.
Refined metal production for the quarter was 259 kt, up 7% sequentially and 1% y-o-y in line with the plant availability. Refined metal production for 9M FY24 stood at 760 kt, flat y-o-y.
Integrated zinc production for the quarter was 203 kt, up 10% sequentially and down 4% y-o-y. Refined lead production for the quarter was 56 kt, down 1% sequentially and up 21% y-o-y on account of pyro operations being operated on lead mode for longer duration as compared to base period to maximize silver production. 9M FY24 integrated zinc production stood at 597 kt, marginally down y-o-y, and refined lead production was at 163 kt, up 4% y-o-y.
Saleable silver production for the quarter was 197 MT, up 9% q-o-q and 22% y-o-y in line with the lead metal production and higher accumulation of WIP in Q2 FY24. 9M FY24 saleable silver production stood at 556 MT, up 5% y-o-y in line with lead metal production.
Financial Performance
Revenue from operations during the quarter was INR 7,310 Crore, up 8% q-o-q on account of better zinc & silver volumes, higher zinc prices and favourable exchange rates partly offset by lower lead prices and volumes. The revenue witnessed a decline of 7% y-o-y on account of significantly lower zinc prices, lower zinc volumes and strategic hedging impact in base period partly offset by increased silver & lead volumes and prices and favourable exchange rates.
9M FY24 revenue from operations stood at INR 21,383 Crore, down 16% y-o-y on account of lower zinc prices and volumes and strategic hedging impact in base period partly offset by better silver & lead volumes and prices, and favourable exchange rates.
Zinc cost of production before royalty (COP) for the quarter stood at US$ 1,095 (INR 91,180) per MT, lower by 4% q-o-q (3% lower in INR terms) and 15% y-o-y (14% lower in INR terms). Zinc COP for 9M FY24 was US$ 1,142 (INR 94,448) per MT, down by 10% y-o-y (7% lower in INR terms). Cost improvement is majorly on account of better volume, softened coal prices, operational efficiency partly offset by lower acid realisation, further supported by better grades and better linkage coal availability and utilisation year on year.
EBITDA for the quarter was INR 3,559 Crore, up 14% q-o-q and down 4% y-o-y in line with the revenue from operations and cost improvement, and for 9M FY24 EBITDA was INR 10,040 Crore, down 25% y-o-y, mainly on account of lower revenue being partially offset by cost improvement.
Net profit for the quarter stood at INR 2,028 Crore, up 17% sequentially on account of higher EBITDA partly offset by higher tax expense, and down 6% y-o-y. 9M FY24 net profit was at INR 5,721 Crore, down by 28% y-o-y, primarily on account of lower EBITDA partly offset by lower tax expense.