PT Vale reports higher production and sales in the second quarter of 2020

About Vale

7/29/2020

PT Vale reports higher production and sales in the second quarter of 2020

Jakarta, July 29, 2020 – PT Vale Indonesia Tbk (“PT Vale” or the “Company”, IDX Ticker: INCO) and its subsidiaries (together the “Group”) today announced its unaudited results for the second quarter of 2020 (“2Q20”). The Group recorded production of 18,701 metric tons (“t”) of nickel in matte, and nickel matte deliveries of 19,887 t equal to sales of US$185.7 million in 2Q20.

Production of nickel in matte and nickel matte deliveries in 2Q20 were respectively about 6% and 19% higher than the production and deliveries volume realized in 1Q20. Meanwhile, production and deliveries in 1H20 were 18% and 19% higher than production and deliveries in 1H19, respectively. Despite a lower average realized nickel price in 2Q20, about 11% lower than 1Q20, the delivery of higher nickel matte volumes resulted in 2Q20 sales showing a 6% increase over 1Q20. “Looking at this achievement, we are confident in our ability to maintain our production levels in 2020,” said Nico Kanter, CEO and President Director of PT Vale.

We appreciate the hard work of all employees at PT Vale to continue achieving good result in this quarter, despite having to focus on managing the impacts of COVID-19 on our operations.

Nico Kanter, CEO and President Director

“We appreciate the hard work of all employees at PT Vale to continue achieving good result in this quarter, despite having to focus on managing the impacts of COVID-19 on our operations.” The Group have been executing several measures to anticipate and mitigate the impact of COVID-19 spread in the operations. While health and safety remain the top priority, the Group is committed to continuing production and project activities to the extent possible.

The Group recorded EBITDA of US$59.4 million in 2Q20, slightly higher than the 1Q20 of US$54.9 million, mainly driven by higher sales. The Group also recorded positive earnings of US$24 million in 2Q20, a decrease from earnings of US$29 million in 1Q20 mainly due to lower finance income and income tax benefit. However, it was significantly higher than in the same period last year when the Group recorded a net loss of US$26.2 million in 1H19. The Group’s cost of revenue in 2Q20 increased by 7% to US$165.6 million from US$154.1 million in 1Q20.

PT Vale disbursed approximately of US$44.3 million in capital expenditures this quarter, an increase from US$33.0 million in 1Q20.

On June 19, 2020, PT Vale was informed that its shareholders, Vale Canada Limited and Sumitomo Metal Mining Co., Ltd had signed definitive agreements (“Agreements”) for the sale of a 20% stake in PT Vale to PT Indonesia Asahan Aluminium (Persero) (“Inalum”), in compliance with PT Vale’s divestment obligation under the Contract of Work dated January 15, 1996 with the Government of Indonesia (as amended) (“COW”).

The signing of the Agreements is a continuation of the Heads of Agreement which was previously signed on October 11, 2019. Based on the COW, divestment is one of the requirements for PT Vale’s continuity of operations beyond 2025.

PT Vale will continue to maintain its focus on improving cost efficiency to sustain competitiveness in the long term without compromising the Company’s foremost values: Life Matters Most and Prize Our Planet.


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Read the complete report by downloading the document below:

2Q20 Quarterly Result 2Q20 Production Report 2Q20 Financial Statement

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PT Vale reports higher production and sales in the second quarter of 2020