“Record high quarter: Best-ever refined metal production at 261kt, Revenue at INR 7,990 Cr., EBITDA at INR 4,392 Cr. & PAT1 at INR 2,701 Cr.”
[1] since UG Transition
Highlights for the quarter
- Mined metal production: 252kt
- Refined metal production: 261kt
- Saleable silver production: 173 MT
- Zinc COP: $1,148 per MT
Udaipur, January 21, 2022: 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, 2021.
Commenting on the performance, Mr Arun Misra, CEO, said: “We delivered best-ever 9M mined metal production and historic-high quarterly refined metal production. At the current run-rate, we are confident to deliver on the one million mark this year. Hindustan Zinc is also geared to invest in world-class technologies & equipment to produce value-added zinc alloy products & provide matching international quality in the domestic market. Our ESG journey is progressing well and we are happy to be ranked first globally in the Dow Jones Sustainability Index under environment category amongst the metals & mining peers. We stand committed to decarbonize our mining operations. We will invest 1bn dollars over next 5 years in our climate change initiatives to bring down dependence on thermal power & progress on our journey of net zero by 2050.”
Mr Sandeep Modi, Interim CFO, said: “We delivered historic-high quarterly Revenue & EBITDA as well as highest-ever Net Profit since transition to UG mining. We maintained cost at almost same levels from last quarter despite continuously rising energy prices. Our sustained efforts on operational efficiencies & cost rationalisation along with favourable LME prices has enabled us to improve margins in these times and generate industry-leading returns for our shareholders.”
Financial Summary Standalone
INR. Cr./as stated
| Particulars | Q3 | Q2 | 9M | |||||
| 2022 | 2021 | Change | 2022 | Change | 2022 | 2021 | Change | |
| Sales1 | ||||||||
| Zinc | 5,667 | 3,835 | 48% | 3,926 | 44% | 13,885 | 9,720 | 43% |
| Lead | 900 | 817 | 10% | 885 | 2% | 2,610 | 2,283 | 14% |
| Silver | 1,081 | 1,145 | -6% | 983 | 10% | 3,170 | 3,032 | 5% |
| Others | 342 | 236 | 45% | 328 | 4% | 978 | 647 | 51% |
| Total | 7,990 | 6,033 | 32% | 6,122 | 31% | 20,643 | 15,682 | 32% |
| EBITDA | 4,392 | 3,314 | 33% | 3,332 | 32% | 11,282 | 7,865 | 43% |
| Profit After Taxes | 2,701 | 2,200 | 23% | 2,017 | 34% | 6,701 | 5,499 | 22% |
| Earnings per Share | 6.39 | 5.21 | 23% | 4.77 | 34% | 15.86 | 13.01 | 22% |
| (INR, not annualised) | ||||||||
| Mined Metal Production (‘000 MT) | 252 | 244 | 3% | 248 | 1% | 722 | 684 | 6% |
| Refined Metal Production (‘000 MT) | ||||||||
| Total Refined Metal | ||||||||
| Zinc | 214 | 182 | 17% | 162 | 32% | 565 | 520 | 9% |
| Saleable Lead | 47 | 52 | -10% | 47 | 1% | 142 | 153 | -7% |
| Zinc & Lead | 261 | 235 | 11% | 209 | 25% | 707 | 674 | 5% |
| Saleable Silver2 (in MT) | 173 | 183 | -5% | 152 | 14% | 485 | 503 | -4% |
| Wind Power (in million units) | 59 | 67 | -12% | 155 | -62% | 348 | 286 | 22% |
| Refined Metal Sales (kt) | ||||||||
| Zinc (kt) | 212 | 182 | 16% | 164 | 29% | 563 | 526 | 7% |
| Lead (kt) | 47 | 53 | -11% | 47 | 1% | 142 | 155 | -8% |
| Silver (MT) | 173 | 183 | -6% | 152 | 14% | 485 | 532 | -9% |
| Zinc CoP without Royalty (INR/MT) | 85,969 | 69,744 | 23% | 83,208 | 3% | 82,834 | 71,369 | 16% |
| Zinc CoP without Royalty ($/MT) | 1,148 | 946 | 21% | 1,124 | 2% | 1,116 | 958 | 16% |
| Zinc LME ($ / MT) | 3,364 | 2,628 | 28% | 2,991 | 12% | 3,093 | 2,314 | 34% |
| Lead LME ($ / MT) | 2,331 | 1,901 | 23% | 2,340 | 0% | 2,269 | 1,819 | 25% |
| Silver LBMA ($ / oz.) | 23.3 | 24.4 | -4% | 24.4 | -4% | 24.8 | 21.8 | 14% |
| USD-INR (average) | 74.90 | 73.74 | 2% | 74.02 | 1% | 74.23 | 74.48 | 0% |
- Including other operating income
- Silver occurs in Lead & Zinc ore and is recovered in the smelting and silver-refining processes.
Financial Summary Consolidated
INR. Cr./as stated
| Particulars | Q3 | Q2 | 9M | |||||
| 2022 | 2021 | Change | 2022 | Change | 2022 | 2021 | Change | |
| Sales1 | ||||||||
| Zinc | 5,667 | 3,835 | 48% | 3,926 | 44% | 13,885 | 9,720 | 43% |
| Lead | 900 | 817 | 10% | 885 | 2% | 2,610 | 2,283 | 14% |
| Silver | 1,081 | 1,145 | -6% | 983 | 10% | 3,170 | 3,032 | 5% |
| Others | 342 | 236 | 45% | 328 | 4% | 978 | 647 | 51% |
| Total | 7,990 | 6,033 | 32% | 6,122 | 31% | 20,643 | 15,682 | 32% |
| EBITDA | 4,392 | 3,314 | 33% | 3,332 | 32% | 11,282 | 7,865 | 43% |
| Profit After Taxes | 2,701 | 2,200 | 23% | 2,017 | 34% | 6,701 | 5,499 | 22% |
| Earnings per Share | 6.39 | 5.21 | 23% | 4.77 | 34% | 15.86 | 13.01 | 22% |
| (INR, not annualised) | ||||||||
| Mined Metal Production (‘000 MT) | 252 | 244 | 3% | 248 | 1% | 722 | 684 | 6% |
| Refined Metal Production (‘000 MT) | ||||||||
| Total Refined Metal | ||||||||
| Zinc | 214 | 182 | 17% | 162 | 32% | 565 | 520 | 9% |
| Saleable Lead | 47 | 52 | -10% | 47 | 1% | 142 | 153 | -7% |
| Zinc & Lead | 261 | 235 | 11% | 209 | 25% | 707 | 674 | 5% |
| Saleable Silver2 (in MT) | 173 | 183 | -5% | 152 | 14% | 485 | 503 | -4% |
| Wind Power (in million units) | 59 | 67 | -12% | 155 | -62% | 348 | 286 | 22% |
| Refined Metal Sales (kt) | ||||||||
| Zinc (kt) | 212 | 182 | 16% | 164 | 29% | 563 | 526 | 7% |
| Lead (kt) | 47 | 53 | -11% | 47 | 1% | 142 | 155 | -8% |
| Silver (MT) | 173 | 183 | -6% | 152 | 14% | 485 | 532 | -9% |
| Zinc CoP without Royalty (INR/MT) | 85,969 | 69,744 | 23% | 83,208 | 3% | 82,834 | 71,369 | 16% |
| Zinc CoP without Royalty ($/MT) | 1,148 | 946 | 21% | 1,124 | 2% | 1,116 | 958 | 16% |
| Zinc LME ($ / MT) | 3,364 | 2,628 | 28% | 2,991 | 12% | 3,093 | 2,314 | 34% |
| Lead LME ($ / MT) | 2,331 | 1,901 | 23% | 2,340 | 0% | 2,269 | 1,819 | 25% |
| Silver LBMA ($ / oz.) | 23.3 | 24.4 | -4% | 24.4 | -4% | 24.8 | 21.8 | 14% |
| USD-INR (average) | 74.90 | 73.74 | 2% | 74.02 | 1% | 74.23 | 74.48 | 0% |
Operational Performance
Mined metal production for the quarter was at 252kt, up 3.4% y-o-y and 9M was at 722kt, up 5.5% y-o-y. This was on account of higher ore production at Sindesar Khurd, Rampura Agucha & Zawar mines, improvement in recoveries partly offset by lower mining grade. Sequentially mined metal production grew by 1.4% mainly due to higher ore treatment at Kayad & Sindesar Khurd mines and improvement in recovery.
Integrated metal production was 261kt for the quarter, up 11% y-o-y & up 25% sequentially. This was supported by better plant & mined metal availability and improved operating parameters. Integrated zinc production was 214kt, up 17% y-o-y and up by 32% sequentially. Integrated lead production for the quarter remained flat sequentially at 47kt but was down 10% y-o-y on account of Pyro plant (CLZS) operations on Zinc-Lead mode compared to Lead mode only. Overall, for the nine-month period, metal production was 707kt up 5% y-o-y in line with better plant and mined metal availability
Integrated silver production was 173 MT, down 5% y-o-y in line with lead production & up 14% sequentially due to depletion of WIP. For the nine-month period, silver production was 4% lower y-o-y to 485 MT in line with the lower lead metal production and depletion of the Silver WIP.
Financial Performance
Revenue from operations during the quarter was INR 7,990 Cr., an increase of 32% y-o-y, led by higher zinc volumes and higher zinc & lead LME prices as well as higher premiums while partly offset by lower lead & silver volumes. Over the year, zinc & lead LME prices were up 28% & 23% respectively.
Sequentially revenue increased 31%, primarily due to higher metal and silver volumes and zinc LME prices partially offset by lower silver prices and WPP volumes. Sequentially zinc and silver sales volumes increased 29% & 14% respectively, while lead sales volumes remained almost flat.
Zinc cost of production before royalty (COP) was $1,148 (INR 85,969) per MT for the quarter, higher by 21% y-o-y and 2% sequentially. The COP for the nine months ended Dec’21 was $1,116 (INR 82,834) per MT, up 16% y-o-y. The COP has been affected by higher coal & commodity price increase (diesel, met coke etc.) partially offset by benefits from better volumes, operational efficiencies, and recoveries.
EBITDA for the quarter was INR 4,392 Cr., up 33% y-o-y and 32% sequentially. EBITDA for the nine months ended Dec’21 was at INR 11,282 Cr., up 43% y-o-y. Rise was primarily due to higher zinc & lead LME prices, higher premiums as well as higher silver prices.
Net profit for the quarter was at INR 2,701 Cr., up 23% y-o-y and 34% sequentially. Increase was mainly driven by higher volumes and higher metal prices. Net Profit for the nine months ended was at INR 6,701 Cr., up 22% y-o-y.
Projects Update
The commissioning of the Fumer plant at Chanderiya is delayed owing to Covid-19 restrictions including stringent visa guidelines for Chinese nationals. All efforts (including support from alternative parties) are in place to get the visa applications cleared and all efforts are in place to complete the commissioning by end of FY22.
ESG update
- Board Level ESG & Sustainability Committee is formed, and its 1st meeting was held in December 2021.
- Hindustan Zinc ranked 5th in Metal and Mining Sector in DJSI/S&P Global Corporate Sustainability Assessment (CSA) & 1st in Asia-Pacific region for Environment Category.
- Chanderiya CPP & Debari units received ‘Sword of Honour’ & 5-star rating from British Safety Council.
- Kayad and Rampura Agucha Mines conferred with ‘5 Star Rated Mines’ by Ministry of Mines towards sustainable mining.
- For Sustainability Goals 2025 – 3 years Engagement with International Union for Conservation of Nature (IUCN) for development of Biodiversity Management Plan from no net loss approach
Liquidity and Investment
As on Dec 31, 2021, the Company’s gross investments and cash & cash equivalents were INR 17,040 Cr. as compared to INR 23,662 Cr. at end of Sept’21.
The Company’s net investments as at end of Dec 31, 2021 was INR 14,227 Cr. as compared to INR 19,103 Cr. at end of Sept’21 and was invested in high quality debt instruments.
Interim Dividend amounting to INR 7,606 Cr. (INR 18 per share) was paid in December 2021.
Earnings Call on Friday, January 21, 2022 at 4:00 pm (IST)
The Company will hold an earnings conference call on Friday, January 21, 2022 at 4.00 pm IST, where senior management will discuss the Company’s results and performance.
Conference Dial-In Information:
Express Join via internet registration
Please dial the below number at least 5-10 minutes prior to the conference schedule.
Universal Access
+91 22 6280 1340, +91 22 7115 8241
Playback Dial-In Numbers
+91 22 71945757, +91 22 66635757
January 21– January 28, 2022
Playback Code: 32060
For further information, please contact:
| Shweta Arora
Head – Investor Relations |
Dipti Agrawal
Head – Corporate Communications |
| +91 9538453097 | +91 7738485450 |
About Hindustan Zinc Limited
Hindustan Zinc Limited (BSE: 500188 and NSE: HINDZINC), a Vedanta Group company, is the world’s largest integrated zinc producer and the third-largest silver producer. The company supplies to more than 40 countries and holds a market share of about 75% of the primary zinc market in India. Hindustan Zinc has been recognized as the world’s most sustainable company in the metals and mining category for the second consecutive year by the S&P Global Corporate Sustainability Assessment 2024, reflecting its operational excellence, innovation, and leading ESG practices. The company also launched EcoZen, Asia’s first low carbon ‘green’ zinc brand. Produced using renewable energy, EcoZen has a carbon footprint of less than 1 tonne of carbon equivalent per tonne of zinc produced, about 75% lower than the global average. Hindustan Zinc is also a certified 2.41 times Water-Positive company and is committed to achieving Net Zero emissions by 2050 or sooner. Transforming the lives of 1.9 million people through its focused social welfare initiatives, Hindustan Zinc is among the Top 10 CSR companies in India. As an energy transition metals company, Hindustan Zinc is pivotal in providing critical metals essential for a sustainable future.
LLearn more about Hindustan Zinc on – https://www.hzlindia.com/home/ and follow us on LinkedIn, Twitter, Facebook, and Instagram for more updates.
