Brazil's Vale reports record-high earnings

Brazil's mining giant Vale, the second largest company in the country and the world's leading iron ore producer, reported on Wednesday record-high net earnings of six billion U.S. dollars in the third quarter of 2010, equal to 1.13 U.S. dollars per share on a fully diluted basis, up 63 percent from the 2Q10 and 260 percent year on year.

Vale qualified the 3Q10 performance as "stellar" and "outstanding", and

stated that it was the company's best financial result ever. Besides the net earnings, Vale achieved record-high figures in operating revenues and margin, as well as cash generation.

The company's operating revenues reached 14.5 billion U.S. dollars in 3Q10, up 46 percent from the 2Q10 and 110 percent year on year. The operating income, as measured by adjusted EBIT (earnings before interest and taxes), totaled 7.8 billion U.S. dollars, up 69.2 percent from 2Q10 and 241.7 percent from 3Q09.

Operational margin, as measured by adjusted EBIT margin, reached 55.6

percent, from 47.9 percent in 2Q10 and 34.2 percent in 3Q09. Cash generation, as measured by adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), reached 8.8 billion U.S. dollars, up 58.1 percent from 2Q10 and 192.5 percent from 3Q09.

"This performance stems from discipline in capital allocation, quality of our assets and efforts to maximize operational efficiency amid a scenario of strong demand for minerals and metals," Vale stated.

According to the company, investments (excluding acquisitions) reached 3.1 billion U.S. dollars in the 3Q10, up 29.7 percent from 2Q10 and 42 percent from 3Q09. Out of that amount, 2.2 billion U.S. dollars were spent on organic growth.

Source: Xinhua