Vale recorded a second-quarter profit of US$76 million, compared to $16 million a year ago. Despite the improvement, the figure fell far short of a Reuters consensus estimate of $1.265 billion and the $1.590 billion in profit notched in the first three months of 2018.
Reuters said the weaker-than-expected rise in quarterly net income was the result of a big currency hit Vale took, despite higher production.
Adjusted earnings before interest, taxes, depreciation and amortization, a good indicator of operating profit, surged 43 per cent to $3.9 billion, matching analysts’ estimates, Reuters said.
Results were helped by iron ore and pellet production that reached a record for an April-to-June period, using a vast rail network to get around the effects of a trucker strike that rattled the country’s economy in May. Vale said a 16 per cent depreciation in the real currency hit net profit to the tune of 7.3 billion reais ($1.98 billion).
Reuters also reported the miner had good news for shareholders, promising to buy back $1 billion worth in common stock and pay out a dividend of $2.054 billion in September, the highest such payment in four years.
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