With record production levels and cost savings of US$ 1,2 billion, Vale has cash flow of US$ 13.3 billion in 2014

About Vale

2/25/2015

With record production levels and cost savings of US$ 1,2 billion, Vale has cash flow of US$ 13.3 billion in 2014

With record production levels and cost savings of US$ 1,2 billion, Vale has cash flow of US$ 13.3 billion in 2014

Watch the video in full and then check out the infographic with the highlights of the 4Q14 results

In the 2014 financial statements, Vale recorded an Adjusted Ebitda of US$ 13.3 billion, despite the sharp reduction in commodity prices on the world market. "Firstly, I would like to highlight the resumption of growth in the production of iron ore, with a supply of 332 million tons last year. We also achieved record production in copper, gold and the highest production level for nickel since 2008. With this we have been able to mitigate the decline in prices, mainly of iron ore, reaching about 28% on average from 2013 to 2014, and maintain revenues at around US$ 38 billion ", explains Luciano Siani, our Chief Financial Officer (CFO), in the video.

The growth in our Base Metals business, where cash flow rose more than 50%, reaching a high of US$ 2.5 billion in 2014, and the turnaround in the Fertilizer business, from a negative result to almost US$ 278 million, were major highlights. Another key point relating to the positive results is the effort to reduce expenses. Vale managed to save almost US$ 1.2 billion compared with 2013, and has been able to maintain an investment program of US$ 12 billion, as well as pay dividends of US$ 4.2 billion, with no increase in debt. Our final result shows a net income of US$ 657 million in 2014.

Vale continues to be competitive

In the video, the CFO also explains how Vale has managed to remain competitive. "With prices ranging from US$ 60 to US$ 70, we are managing to deliver iron ore to our customers in China at US$ 46 per tonne. We think there's a lot of potential to reduce these numbers because of the cost reductions brought about by increased volumes, the devaluation of the Brazilian real, and the declining in oil prices that took place towards the end of 2014 and is not fully reflected in the numbers for the year".

The last year also witnessed other achievements, such as the delivery of various projects on schedule and within budget, the obtaining of the license for a new mine in Carajás (N4WS) and the strategic agreement with Mitsui, a Japanese company, which became Vale’s partner in the development of the Nacala Corridor project in Mozambique. "We are fully prepared for the years to come. And the S11D project, the largest in the company’s history, will surely move us to a different level, allowing Vale to ensure positive cash flow in any price scenario, "affirms Siani.

Downloads

Financial
Report

Access the
webcasts

Production
Report

2014 Get to know our results

Key Financial Figures

Cash Flow
US$ 13.3 bi even in a very challenging year of
declining commodities prices.

Base Metals
US$ 2.5 bi of cash generation in
2014, a growing of
over 50% versus 2013.

Cost savings of more than US$ 1 bi

Vale managed to save US$ 1,2 billion compared with 2013,
which already was a year of very significant reductions compared to 2012.

Production

Iron Ore 331.6 Mt

With the resumption of growth in the production, iron
ore reached the mark of 332 million tons last year,
including own production record of 319.2 Mt
(7.2 Mt above the target for 2014) and 12.3 Mt of ore
purchased from third parties. Carajás achieved a new
historical record with an output of 34.9 Mt in 4Q14.

Thousand metric tons
  • Pellets 42.965
  • Coal 8.645
  • Phosphate Rock 8.421
  • Manganese 2.352
  • Potash 492
  • Copper 379,7
  • Nickel 275

Competitiveness

“We still have a competitive position in terms of costs. In 2014, the average cash cost for iron ore were of US$ 23.5 per ton and the average freight costs were of US$ 22.6 per ton. With prices ranging from US$ 60 to US$ 70, we are managing to deliver iron ore to our customers in China at US$ 46 per tonne. We think there's a lot of potential to reduce these numbers”, says Luciano Siani, our CFO.

2014 Average

  • US$ 23.5 Cash cost
  • US$ 22.6 Freight cost
    to China
  • US$ 46 Per each tonne of
    iron ore landed
    in China

Operating Revenue
by country

7.2% 17.5% 51.2% 19.1% 3.3% 1.6% *Of Vale's total sales, 33.1%
were destined to China.
  • North
  • South
    America
  • Europe
  • Asia*
  • Middle
    East
  • Others

30th anniversary of
the Carajás Railroad

The Carajás Railroad (Estrada de Ferro Carajás, EFC) started to operate 30 years ago, in 1985, to transport iron ore and manganese from Carajás mine, in Pará, to the port terminal of Ponta da Madeira, in São Luís. Currently, the tracks of the EFC transport 130 million tons and 360 thousand passengers per year. See a photo gallery with frames of this

Photo Gallery

​​​​​​​​

With record production levels and cost savings of US$ 1,2 billion, Vale has cash flow of US$ 13.3 billion in 2014