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Vale still riding high

Kate Haycock
Friday, 24 October 2008

THE global financial crisis and the economic slowdown was nowhere in evidence in massive Brazilian miner Vale’s third quarter production and financial results.



Vale's Carborough Downs operation.

While the mining industry braces itself for hard times, Vale has announced a record gross revenue of $US12.1 billion ($A18.2 billion), some 49% higher than the same time last year.

Profits were also in record territory, with Vale’s earnings before interest and tax coming in at a cool $5.5 billion, 61% higher year on year.

Much of the company’s bumper profits came from its all-time high shipments of iron ore and pellets, which reached 85.9 million tonnes – 10% higher than the previous quarter and 7% higher than the same time last year.

In coal, the miner’s production reached 1.05Mt, down 10% from the previous quarter but 5% higher year on year.

Vale’s nickel output came to 72,400t, up 4.9% over the previous record and 31.5% higher than the 2007 figures.

And despite gloomy forecasts for world growth, last week Vale’s board approved $US14.2 billion in spending for existing operations, research and development, and project execution.

In a statement, the mining giant said despite the financial crisis, it believed in the long-term prospects for the industry.

“Notwithstanding the risks, emerging economies are expected to provide a source of resilience, benefiting from strong productivity growth and improved economic policy frameworks,” the miner said.

Shares in Vale were last trading at $US11.45 on the New York Stock Exchange, off from $25 in September.

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