Iron-Ore Producer Vale Sees Earnings Plunge
27 Julho 2017 - 09:44AM
Dow Jones News
By Paul Kiernan
RIO DE JANEIRO -- Brazilian mining giant Vale SA reported a
sharp drop in its earnings during the second quarter despite record
iron-ore production, as asset write-downs, higher costs and
financial losses weighed on its bottom line.
Vale, the world's largest iron-ore producer, said its net profit
fell to $16 million, down from $1.11 billion in the second-quarter
of 2016.
The company's revenue rose 17% in the quarter to $7.24 billion
amid higher prices for iron ore and increased sales of other
minerals like copper and coal. Adjusted earnings before interest,
taxes, depreciation and amortization, or Ebitda, rose 16% to $2.73
billion, Vale said.
But Vale, which is located thousands of miles away from its main
iron-ore market in China, suffered from sharply higher freight
costs in the April-to-June period. Its derivatives on commodities,
currencies and interest rates, after bringing in a hefty profit a
year earlier, produced a loss in the second quarter, as did
currency fluctuations.
Vale also recorded asset write-downs of $414 million related to
discontinued operations, such as fertilizer assets sold in December
in exchange for shares of The Mosaic Co., which fell during the
second quarter.
Write to Paul Kiernan at paul.kiernan@wsj.com
(END) Dow Jones Newswires
July 27, 2017 08:29 ET (12:29 GMT)
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