United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the
Securities Exchange Act of 1934
For the month of
April 2024
Vale S.A.
Praia de Botafogo nº 186, 18º andar, Botafogo
22250-145 Rio de Janeiro, RJ, Brazil
(Address of principal executive office)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F x Form 40-F ¨
Vale's performance in 1Q24
Rio de Janeiro, April 24th, 2024."We got off to a strong start in 2024, fueled by our commitment to operational excellence. In the Iron Ore Solutions business, our iron ore sales have increased by 15% year on year, driven by robust production - the highest Q1 output since 2019. We're also making progress on our growthprojects, which will help improve our product portfolio's quality and flexibility. Within the Energy Transition Metals business, improved performance at the Salobo complex, coupled with the Salobo 3 plant ramp-up, drove the increase in copper production and sales volumes. Encouraging results were also seen in our Canadian nickel operations, with higher availability of own sourced ore. Aligned with our commitment to society, we're proud to have achieved 100% renewable energy consumption in Brazil, two years ahead of schedule. As we continue on our journey, we remain committed to building an even greater Vale.", commented Eduardo Bartolomeo, Chief Executive Officer.
Selected financial indicators
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net operating revenues | 8,459 | 8,434 | 0% | 13,054 | -35% |
Total costs and expenses (ex-Brumadinho and de-characterization of dams)1 | (5,897) | (5,403) | 9% | (7,278) | -19% |
Expenses related to Brumadinho event and de-characterization of dams | (41) | (111) | -63% | (396) | -90% |
Adjusted EBIT | 2,724 | 3,058 | -11% | 5,599 | -51% |
Adjusted EBIT margin (%) | 32% | 36% | -4 p.p. | 43% | -11 p.p. |
Adjusted EBITDA | 3,438 | 3,714 | -7% | 6,454 | -47% |
Adjusted EBITDA margin (%) | 41% | 44% | -3 p.p. | 49% | -8 p.p. |
Proforma adjusted EBITDA (incl. associates & JVs EBITDA) 2 3 4 | 3,479 | 3,825 | -9% | 6,850 | -49% |
Proforma adjusted EBITDA (excl. associates & JVs EBITDA) 2 3 4 | 3,279 | 3,687 | -11% | 6,730 | -51% |
Net income attributable to Vale's shareholders | 1,679 | 1,837 | -9% | 2,418 | -31% |
Net debt 5 | 10,105 | 8,226 | 23% | 9,560 | 6% |
Expanded net debt | 16,388 | 14,359 | 14% | 16,164 | 1% |
Capital expenditures | 1,395 | 1,130 | 23% | 2,118 | -34% |
1 Includes adjustment of US$ 67 million in 1Q24, US$ 35 million in 4Q23 and US$ 82 million in 4Q23, to reflect the performance of the streaming transactions at market price. 2 Excluding expenses related to Brumadinho. 3 Starting from 1Q24 the EBITDA will be reported including the EBITDA proportionate from associates and JVs and the previous periods were restated. Previously, the EBITDA reflected solely the dividends received from associates and JVs. For more information, please refer to the Adjusted EBITDA section. 4 Including dividends received from associates & JVs. 5 Including leases (IFRS 16). |
Highlights
Business Results
· | Proforma adjusted EBITDA (including associates and JVs proportionate EBITDA in the amount of US$ 203 million) of US$ 3.5 billion in Q1, 9% lower y/y and 49% lower q/q, mainly as a result of weaker iron ore fines realized prices. Q/q variation was also impacted by seasonally lower sales. |
· | Iron ore sales increased 8.2 Mt (+15%) and while copper sales increased 14.1 kt (+22%) y/y , both supported by continued operational improvements. |
· | Iron ore fines C1 cash cost ex-3rd party purchases was slightly lower y/y, reaching US$ 23.5/t in Q1, despite the negative effect of the BRL appreciation. |
· | Free Cash Flow generation totaled US$ 2.0 billion in Q1, representing an EBITDA to cash-conversion of 57%, positively impacted by strong collection from Q4 sales. |
1 |
Disciplined capital allocation
· | Capital expenditures of US$ 1.4 billion in Q1, US$ 0.3 billion higher y/y, as expected. The Serra Sul 120 Mtpy project estimated CAPEX was revised upwards to US$ 2.8 billion, primarily driven by higher input and services costs higher input and services sourcing costs driven by a combined effect of the inflationary economic scenario since the project's approval, and the delay of almost 18 months in the issuance of the project's installation license. The project's start-up in 2H26 and Vale's CAPEX guidance for 2024 of around US$ 6.5 billion remain unchanged. |
· | Gross debt and leases of US$ 14.7 billion as of March 31st, 2024, US$ 0.8 billion higher q/q mainly as a result of new loans raised by Vale S.A. and Vale Base Metals, within our liability management plan. |
· | Expanded net debt of US$ 16.4 billion as of March 31st, 2024, US$ 0.2 billion higher q/q, mainly driven by the increase in net debt. Vale's expanded net debt target remains at US$ 10-20 billion. |
Value creation and distribution
· | Allocation of US$ 275 million as part of the 4th buyback program in the quarter. As of the date of this report, the 4th buyback program was 17% complete[1], with 29.9 million shares repurchased. |
Recent developments
· | Agreement to acquire the entire 45%-stake held by Cemig Geração e Transmissão S.A. in Aliança Geração de Energia S.A. ("Aliança Energia") for R$ 2.7 billion. Upon closing, we will hold 100% of Aliança Energia's shares. Aliança Energia's power generation asset portfolio consists of seven hydroelectric power plants and three wind farms in Brazil, comprising an installed capacity of 1,438 MW and an average physical guarantee of 755 MW. This transaction aligns with Vale's strategy to have an energy matrix based on renewable sources in Brazil and supports its commitment to decarbonize operations at competitive costs. |
Focusing and strengthening the core
· | Gaining momentum on Iron Ore Solutions: |
· | The US Government's Department of Energy has selected Vale USA to begin award negotiations for Bipartisan Infrastructure Law and Inflation Reduction Act funding. Vale aims for up to US$ 282.9 million to develop an iron ore briquette plant customized for the direct reduction route in the US, with plans for similar facilities in Brazil and globally. The briquettes technology was developed by Vale in Brazil to the support global steel industry and the first plant in the world was inaugurated in 2023 in Vitória, Brazil. |
· | Building a unique Energy Transition Metals vehicle: |
· | Last week, the Committee on Foreign Investment in the United States (CFIUS) granted the final regulatory approval for the Energy Transition Metals partnership. The transaction closing is expected in the upcoming weeks. |
· | The definitive agreement on the PTVI divestment was signed in February. As per the agreement, Vale Canada Ltd ("VCL") will receive approximately US$ 160 million[2]in cash upon closing of the transaction, which is expected to happen before the end of 2024, after the fulfillment of customary closing conditions. Upon completion, VCL will hold 33.9% of PTVI. |
Promoting sustainable mining
· | Vale has achieved 100% renewable electricity consumption in Brazil two years ahead of schedule, which was 2025. With that, the company has zeroed its indirect CO2 emissions in the country. Also, it remains committed to achieving 100% renewable electricity consumption in its global operations by 2030, from the current 88.5%. |
[1]Related to the October 2023 4th buyback program for a total of 150 million shares.
[2] Considering IDR 15,600/USD and agreed share price of IDR 3,050/share.
2 |
· | The Peneirinha dam, located in the Vargem Grande complex, was removed from the emergency level by the National Mining Agency in March. The structure received a positive Declaration of Stability Condition (DCE) certifying its safety. This is the Company's 12th dam to leave the emergency level in the last two years. |
· | Vale's ESG Risk Rating, assessed by Sustainalytics, improved from 35.3 last year to 31.2 in April, in further recognition of our efforts to build a safer and more sustainable company. |
Reparation
· | The Brumadinho Integral Reparation Agreement continues to progress with 69% of the agreed-upon commitments completed and in accordance with the settlement deadlines. |
· | In the Mariana reparation, around R$ 36 billion has been spent on remediation and compensation, and approximately 85% of resettlement cases are now completed. |
3 |
Adjusted EBITDA
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net operating revenues | 8,459 | 8,434 | 0% | 13,054 | -35% |
COGS | (5,367) | (4,949) | 8% | (6,891) | -22% |
SG&A | (140) | (118) | 19% | (146) | -4% |
Research and development | (156) | (139) | 12% | (231) | -32% |
Pre-operating and stoppage expenses | (92) | (124) | -26% | (108) | -15% |
Expenses related to Brumadinho & de-characterization of dams | (41) | (111) | -63% | (396) | -90% |
Other operational expenses¹ | (142) | (73) | 95% | 98 | n.a. |
EBITDA from associates and JVs | 203 | 138 | 47% | 219 | -7% |
Adjusted EBIT | 2,724 | 3,058 | -11% | 5,599 | -51% |
Depreciation, amortization & depletion | 714 | 656 | 9% | 855 | -16% |
Adjusted EBITDA | 3,438 | 3,714 | -7% | 6,454 | -47% |
Proforma Adjusted EBITDA (incl. associates & JVs EBITDA)²,³ | 3,479 | 3,825 | -9% | 6,850 | -49% |
Proforma Adjusted EBITDA (excl. associates & JVs EBITDA)²,³,4 | 3,279 | 3,687 | -11% | 6,730 | -51% |
¹ Includes adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23, to reflect the performance of the streaming transactions at market price. ² Excluding expenses related to Brumadinho. 3 Starting from 1Q24 the EBITDA will be reported including the EBITDA proportionate from associates and JVs and the previous periods were restated. Previously, the EBITDA reflected solely the dividends received from associates and JVs. 4 Including dividends received from associates & JVs. |
Proforma EBITDA (including associates and JVs EBITDA) - US$ million, 1Q24 vs. 1Q23
Proforma EBITDA - Revised Reporting Practices: Following international reporting practices, Vale changed its Proforma EBITDA definition to include the "EBITDA from associates and joint ventures", which is a measure of their "equity results" excluding: (i) net finance costs; (ii) depreciation, depletion, and amortization; (iii) taxation and (iv) impairments. The comparative information in these interim financial statements was restated to reflect this change in the adjusted EBITDA definition. Additionally, as a result of the reorganization of assets and the governance established for the Energy Transition Metals segment, the "Other" segment was reorganized for a better allocation of direct effects on the Iron Ore Solutions and Energy Transition Metals businesses. These effects were allocated to each segment starting from the period ended March 31st, 2024. For more information, access Vale's 1Q24 Financial Statements on our website. |
4 |
Sales & price realization
Volume sold - Minerals and metals
'000 metric tons | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Iron ore | 63,827 | 55,659 | 15% | 90,328 | -29% | |
Iron ore fines | 52,546 | 45,861 | 15% | 77,885 | -33% | |
ROM | 2,056 | 1,665 | 23% | 2,158 | -5% | |
Pellets | 9,225 | 8,133 | 13% | 10,285 | -10% | |
Nickel | 33 | 40 | -18% | 48 | -31% | |
Copper¹ | 77 | 63 | 22% | 98 | -21% | |
Gold as by-product ('000 oz)¹ | 97 | 72 | 35% | 125 | -22% | |
Silver as by-product ('000 oz)¹ | 433 | 406 | 7% | 513 | -16% | |
PGMs ('000 oz) | 73 | 74 | -2% | 59 | 24% | |
Cobalt (metric ton) | 465 | 621 | -25% | 492 | -5% | |
¹ Including sales originated from both nickel and copper operations. | ||||||
Average realized prices
US$/ton | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Iron ore - 62% Fe reference price | 123.6 | 125.5 | -2% | 128.3 | -4% |
Iron ore fines Vale CFR/FOB realized price | 100.7 | 108.6 | -7% | 118.3 | -15% |
Pellets CFR/FOB (wmt) | 171.9 | 162.5 | 6% | 163.4 | 5% |
Nickel | 16,848 | 25,260 | -33% | 18,420 | -9% |
Copper2 | 7,632 | 9,298 | -18% | 7,867 | -3% |
Gold (US$/oz)12 | 2,079 | 1,845 | 13% | 2,125 | -2% |
Silver (US$/oz)2 | 23.0 | 22.1 | 4% | 24.6 | -7% |
Cobalt (US$/t)1 | 30,502 | 32,830 | -7% | 35,438 | -14% |
¹ Prices presented above were adjusted to reflect the market prices of products delivered related to the streaming transactions. 2 Including sales originated from both nickel and copper operations. |
Costs
COGS by business segment
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Iron Ore Solutions | 4,006 | 3,290 | 22% | 5,092 | -21% |
Energy Transition Metals | 1,360 | 1,620 | -16% | 1,735 | -22% |
Others | - | 39 | -100% | 64 | -100% |
Total COGS¹ | 5,367 | 4,949 | 8% | 6,891 | -22% |
Depreciation | 678 | 613 | 11% | 819 | -17% |
COGS, ex-depreciation | 4,689 | 4,336 | 8% | 6,072 | -23% |
¹ COGS currency exposure in 1Q24 was as follows: 52.0% BRL, 42.0% USD, 5.8% CAD and 0.2% Other currencies. |
Expenses
Operating expenses
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
SG&A | 140 | 118 | 19% | 146 | -4% |
Administrative | 120 | 100 | 20% | 121 | -1% |
Personnel | 56 | 45 | 24% | 48 | 17% |
Services | 32 | 28 | 14% | 41 | -22% |
Depreciation | 10 | 11 | -9% | 10 | - |
Others | 22 | 16 | 38% | 22 | - |
Selling | 20 | 18 | 11% | 25 | -20% |
R&D | 156 | 139 | 12% | 231 | -32% |
Pre-operating and stoppage expenses | 92 | 124 | -26% | 108 | -15% |
Expenses related to Brumadinho and de-characterization of dams | 41 | 111 | -63% | 396 | -90% |
Other operating expenses | 209 | 108 | 94% | (16) | n.a. |
Total operating expenses | 638 | 600 | 6% | 865 | -26% |
Depreciation | 36 | 43 | -16% | 35 | 3% |
Operating expenses, ex-depreciation | 602 | 557 | 8% | 830 | -27% |
5 |
Brumadinho
Impact of Brumadinho and De-characterization in 1Q24
US$ million | Provisions balance 31dec23 | EBITDA impact2 | Payments | FX and other adjustments3 | Provisions balance 31mar24 |
De-characterization | 3,451 | (61) | (119) | (60) | 3,211 |
Agreements & donations¹ | 3,060 | (6) | (135) | (25) | 2,894 |
Total Provisions | 6,511 | (67) | (254) | (85) | 6,105 |
Incurred Expenses | - | 108 | (108) | - | - |
Total | 6,511 | 41 | (362) | (85) | 6,105 |
¹ Includes Integral Reparation Agreement, individual, labor and emergency indemnifications, tailing removal and containment works. 2 Includes the revision of estimates for provisions and incurred expenses, including discount rate effect. 3 Includes foreign exchange, present value and other adjustments. |
Impact of Brumadinho and De-characterization from 2019 to 1Q24
US$ million | EBITDA impact | Payments | PV & FX adjust² | Provisions balance 31mar24 |
De-characterization | 5,130 | (1,715) | (204) | 3,211 |
Agreements & donations¹ | 9,113 | (6,467) | 248 | 2,894 |
Total Provisions | 14,243 | (8,182) | 44 | 6,105 |
Incurred expenses | 3,087 | (3,087) | - | - |
Others | 180 | (178) | (2) | - |
Total | 17,510 | (11,447) | 42 | 6,105 |
¹ Includes Integral Reparation Agreement, individual, labor and emergency indemnifications, tailing removal and containment works. ² Includes foreign exchange, present value and other adjustments. |
Cash outflow of Brumadinho & De-characterization commitments1,2:
US$ billion | Disbursed from 2019 to 1Q24 | 2Q24 to 4Q24 | 2025 | 2026 | 2027 | Yearly average 2028-2035³ |
De-characterization | 1.7 | 0.5 | 0.6 | 0.6 | 0.5 | 0.3 |
Integral Reparation Agreement & other reparation provisions | 6.4 | 0.9 | 1.0 | 0.7 | 0.3 | 0.14 |
Incurred expenses | 3.1 | 0.4 | 0.4 | 0.4 | 0.3 | 0.45 |
Total | 11.2 | 1.8 | 2.0 | 1.7 | 1.1 | - |
1 Estimate cash outflow for 2024-2035 period, given BRL-USD exchange rates of 4.9962. 2 Amounts stated without discount to present value, net of judicial deposits and inflation adjustments. 3 Estimate annual average cash flow for De-characterization provisions in the 2028-2035 period is US$ 265 million per year. 4 Disbursements related to the Integral Reparation Agreement ending in 2030. 5 Disbursements related to incurred expenses ending in 2028. |
6 |
Net income
Reconciliation of proforma EBITDA to net income
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Proforma Adjusted EBITDA | 3,479 | 3,825 | -9% | 6,850 | -49% |
Brumadinho and de-characterization of dams | (41) | (111) | -63% | (396) | -90% |
Adjusted EBITDA | 3,438 | 3,714 | -7% | 6,454 | -47% |
Impairment reversal (impairment and disposals) of non-current assets, net 1 | (73) | (39) | 87% | (203) | -64% |
EBITDA from associates and JVs | (203) | (138) | 47% | (219) | -7% |
Equity results and net income (loss) attributable to noncontrolling interests | 116 | (96) | n.a. | (1,176) | n.a. |
Financial results | (437) | (530) | -18% | (874) | -50% |
Income taxes | (448) | (418) | 7% | (709) | -37% |
Depreciation, depletion & amortization | (714) | (656) | 9% | (855) | -16% |
Net income attributable to Vale's shareholders | 1,679 | 1,837 | -9% | 2,418 | -31% |
1 Includes adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23, to reflect the performance of the streaming transactions at market price. |
Financial results
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Financial expenses, of which: | (339) | (320) | 6% | (380) | -11% |
Gross interest | (171) | (180) | -5% | (190) | -10% |
Capitalization of interest | 5 | 5 | - | 5 | - |
Others | (145) | (107) | 36% | (163) | -11% |
Financial expenses (REFIS) | (28) | (38) | -26% | (32) | -13% |
Financial income | 109 | 121 | -10% | 105 | 4% |
Shareholder Debentures | 164 | (47) | n.a. | (483) | n.a. |
Derivatives¹ | 2 | 192 | -99% | 200 | -99% |
Currency and interest rate swaps | (13) | 216 | n.a. | 218 | n.a. |
Others (commodities, etc) | 15 | (24) | n.a. | (18) | n.a. |
Foreign exchange and monetary variation | (373) | (476) | -22% | (316) | 18% |
Financial result, net | (437) | (530) | -18% | (874) | -50% |
¹ The cash effect of the derivatives was a gain of US$ 43 million in 1Q24. |
Main factors that affected net income in 1Q24 vs. 1Q23
US$ million | Comments | |
1Q23 Net income attributable to Vale's shareholders | 1,837 | |
Changes to: | ||
Proforma EBITDA | (346) | Mainly due to lower iron ore fines, nickel and copper realized prices, partially offset by higher iron ore and copper sales volumes. |
Brumadinho and de-characterization of dams | 70 | |
Impairment & disposal of non-current assets | (34) | |
EBITDA from associates and JVs | (65) | |
Equity results and net income (loss) attributable to noncontrolling interests | 212 | Absence of 1Q23 impairment impacts. |
Financial results | 93 | Positive effect from mark-to-market of shareholders' debentures and gain on exchange variation. |
Income taxes | (30) | |
Depreciation, depletion & amortization | (58) | |
1Q24 Net income attributable to Vale's shareholders | 1,679 |
7 |
CAPEX
Growth and sustaining projects execution
US$ million | 1Q24 | % | 1Q23 | % | ∆ y/y | 4Q23 | % | ∆ q/q |
Growth projects | 367 | 26.3 | 326 | 28.8 | 13% | 481 | 22.7 | -24% |
Iron Ore Solutions | 320 | 22.9 | 236 | 20.9 | 36% | 374 | 17.7 | -14% |
Energy Transition Metals | 39 | 2.8 | 72 | 6.4 | -46% | 95 | 4.5 | -59% |
Nickel | 32 | 2.3 | 20 | 1.8 | 60% | 84 | 4.0 | -62% |
Copper | 7 | 0.5 | 52 | 4.6 | -87% | 11 | 0.5 | -36% |
Energy and others | 8 | 0.6 | 18 | 1.6 | -56% | 12 | 0.6 | -33% |
Sustaining projects | 1,028 | 73.7 | 804 | 71.2 | 28% | 1,637 | 77.3 | -37% |
Iron Ore Solutions | 681 | 48.8 | 512 | 45.3 | 33% | 946 | 44.7 | -28% |
Energy Transition Metals | 328 | 23.5 | 263 | 23.3 | 25% | 664 | 31.4 | -51% |
Nickel | 274 | 19.6 | 204 | 18.1 | 34% | 520 | 24.6 | -47% |
Copper | 54 | 3.9 | 59 | 5.2 | -8% | 144 | 6.8 | -63% |
Energy and others | 19 | 1.4 | 29 | 2.6 | -34% | 27 | 1.3 | -30% |
Total | 1,395 | 100.0 | 1,130 | 100.0 | 23% | 2,118 | 100.0 | -34% |
Growth projects
Investments in growth projects totaled US$ 367 million in Q1, US$ 41 million higher y/y, driven by higher expenditures in the execution of Serra Sul 120 Mtpy, Capanema and Onça Puma 2nd Furnace projects, as the construction of these projects advance.
The Serra Sul 120 Mtpy project estimated CAPEX has been revised upwards to US$ 2.8 billion (from US$ 1.5 billion) due to: (i) higher input and services sourcing costs, driven by a combined effect of the inflationary economic scenario since the project's approval, and the delay of almost 18 months in the issuance of the installation license, (ii) engineering design changes in the plant's processing lines, and (iii) contingency budget review. The project's start-up by 2H26 and capacity addition of 20 Mtpy are unchanged.
Growth projects progress indicator[3]
Projects | Capex 1Q24 | Financial progress1 | Physical progress | Comments |
Iron Ore Solutions | ||||
Northern System 240 Mtpy Capacity: 10 Mtpy Start-up: 1H23 Capex: US$ 772 MM | 30 | 87% | 98%2 | On the railroad, the bridge over the Jacundá river has been completed. At the port, the operating approvals are expected in Q2. Load tests at the loading silo of the mine have been re-programmed for Q2. |
Serra Sul 120 Mtpy3 Capacity: 20 Mtpy Start-up: 2H26 Capex: US$ 2,844 MM | 125 | 37% | 68% | Assembly of the semi-mobile crusher at the mine and the conveyor belts in the West Corridor have started. Civil construction of the long-distance conveyor belt has begun with field assembly in March. At the plant, concrete is being laid according to plan. |
Capanema's Maximization Capacity: 18 Mtpy Start-up: 1H25 Capex: US$ 913 MM | 89 | 53% | 74% | The assembly of equipment, crushing machinery, structures and conveyor belts is on schedule to be ready by Q3. The project began pre-commissioning activities with the provisional energization of the substation and secondary circuit equipment. |
Briquettes Tubarão Capacity: 6 Mtpy Start-up: 4Q23 (Plant 1) | 2H24 (Plant 2) Capex: Under review4 | 24 | - | 98% | Plant 2 is commissioning the drying and mixing processes, 2 of the 8 briquette processing steps and start-up is now expected by mid-year. |
Energy Transition Metals | ||||
Onça Puma 2nd Furnace Capacity: 12-15 ktpy Start-up: 2H25 Capex: US$ 555 MM | 33 | 24% | 36% | The demolition of older structures was concluded. Assembly of the second furnace, detailed engineering, and procurement of equipment is ongoing. |
1 CAPEX disbursement until end of 1Q24 vs. CAPEX expected. 2 Considering physical progress of mine, plant and logistics. 3 The project consists of increasing the S11D mine-plant capacity by 20 Mtpy. 4 The project scope is being revised in order to improve standards and operational synergies with the existing assets. |
[3]Pre-Operating expenses included in the total estimated capex information, according to the approvals from Vale´s Board of Directors.
8 |
Sustaining projects
Investments in sustaining our operations totaled US$ 1.028 billion in Q1, US$ 224 million higher y/y, mainly as a result of higher disbursements in the Voisey's Bay Mine Extension (VBME) project and higher investments in the enhancement of operations, including: (i) Compact Crushing at S11D; and (ii) adaptations in Carajás' Plant 1 for 100% dry processing of ROM.
CAPEX for the VBME project increase by US$ 0.2 billion to its estimated CAPEX mainly to address engineering adjustments and to improve mine development execution. The project is in an advanced stage of execution, with the Reid Brook mine and the main surface facilities fully operational and the full mine assets at Eastern Deeps expected to be in operation by the end of 2024.
Sustaining projects progress indicator[4]
Projects | Capex 1Q24 | Financial progress1 | Physical progress | Comments |
Iron Ore Solutions | ||||
Compact Crushing S11D Capacity: 50 Mtpy Start-up: 2H26 Capex: US$ 755 MM | 46 | 22% | 33% | Concrete has been laid for the first floor of the building of the primary crushing structure. Civil construction for the second crusher has started. Work on the conveyor belts of the Western Corridor expected to be completed in 1H24. |
N3 - Serra Norte Capacity: 6 Mtpy Start-up: 2H26 Capex: US$ 84 MM | 1 | 18% | 18% | The Installation License and Vegetation Suppression Authorization are pending, and start-up was reviewed from 1H26 to 2H26. |
VGR 1 plant revamp3 Capacity: 17 Mtpy Start-up: 2H24 Capex: US$ 67 MM | 10 | 49% | 89% | The Vargem Grande integrated plan (for the 3 projects3) has been issued. With the completion of all the foundation piles, civil works are almost complete. |
Energy Transition Metals | ||||
Voisey's Bay Mine Extension Capacity: 45 ktpy (Ni) and 20 ktpy (Cu) Start-up: 1H212 Capex: US$ 2,940 MM | 121 | 88% | 94% | The Reid Brook Powerhouse, the final surface asset to be completed, is 70% complete and is expected to be running by the end of Q3. In the underground portion of the expansion, the scope in Reid Brook is complete. The mine development at Eastern Deeps is concluded. Construction of the Bulk Material Handling system, dewatering and support facilities is ongoing. The full mine assets at Eastern Deeps are expected to be in operation by the end of 2024. |
1 CAPEX disbursement until end of 1Q24 vs. CAPEX expected. 2 In 2Q21, Vale achieved the first ore production of Reid Brook deposit, the first of two underground mines to be developed in the project. Eastern Deeps, the second deposit, has started to extract development ore from the deposit and is continuing its scheduled production ramp-up. 3 VGR 1 is a program made up of three simultaneous projects, VGR I Waste Containment System, Water Adequacy and the VGR I Revamp, all aimed at boosting the recovery of production capacity. The progress data provided focuses on the program's main project, the VGR I Waste Containment System. |
Sustaining capex by type - 1Q24
US$ million | Iron Ore Solutions | Energy Transition Materials | Energy and others | Total |
Enhancement of operations | 366 | 145 | 2 | 513 |
Replacement projects | 9 | 133 | - | 142 |
Filtration and dry stacking projects | 28 | - | - | 28 |
Dam management | 42 | 5 | - | 47 |
Other investments in dams and waste dumps | 53 | 9 | - | 62 |
Health and Safety | 60 | 26 | 3 | 89 |
Social investments and environmental protection | 65 | 2 | - | 68 |
Administrative & Others | 57 | 8 | 14 | 79 |
Total | 681 | 328 | 19 | 1,028 |
[4]Pre-Operating expenses included in the total estimated capex information, according to the approvals from Vale´s Board of Directors
9 |
Free cash flow
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Proforma EBITDA | 3,479 | 3,825 | -9% | 6,850 | -49% |
Working capital | 1,468 | 739 | 99% | (852) | n.a. |
Brumadinho and de-characterization expenses | (362) | (313) | 16% | (668) | -46% |
Income taxes and REFIS | (506) | (337) | 50% | (259) | 95% |
Capex | (1,395) | (1,130) | 23% | (2,118) | -34% |
associates & JVs | (203) | (138) | 47% | (219) | -7% |
Others | (481) | (362) | 33% | (221) | 118% |
Free Cash Flow | 2,000 | 2,284 | -12% | 2,513 | -20% |
Cash management and others | (1,795) | (2,364) | -24% | (2,181) | -18% |
Increase/Decrease in cash & cash equivalents | 205 | (80) | n.a. | 332 | -38% |
Free Cash Flow generation reached US$ 2.0 billion in 1Q24, US$ 284 million lower y/y, mainly explained by a combination of lower Proforma EBITDA (US$ 346 million lower y/y), higher capex (US$ 265 million higher y/y) and positive working capital (US$ 729 million higher y/y).
In the quarter, the positive working capital variation is largely explained by the strong cash collection from 4Q23 sales and extension of supplier payment terms, which were partially offset by inventory build-up after its consumption in the last quarter.
In 1Q24, Vale's cash generation and position was primarily used to distribute US$ 2.328 billion to shareholders in dividends and the repurchase of US$ 275 million in shares.
Free Cash Flow - US$ million, 1Q24
10 |
Debt
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Gross debt¹ | 13,248 | 11,464 | 16% | 12,471 | 6% |
Lease (IFRS 16) | 1,426 | 1,520 | -6% | 1,452 | -2% |
Gross debt and leases | 14,674 | 12,984 | 13% | 13,923 | 5% |
Cash, cash equivalents and short-term investments² | (4,569) | (4,758) | -4% | (4,363) | 5% |
Net debt | 10,105 | 8,226 | 23% | 9,560 | 6% |
Currency swaps³ | (589) | (421) | 40% | (664) | -11% |
Brumadinho provisions | 2,894 | 3,358 | -14% | 3,060 | -5% |
Samarco & Renova Foundation provisions4 | 3,978 | 3,196 | 24% | 4,208 | -5% |
Expanded net debt | 16,388 | 14,359 | 14% | 16,164 | 1% |
Average debt maturity (years) | 7.5 | 8.4 | -11% | 7.9 | -5% |
Cost of debt after hedge (% pa) | 5.7 | 5.3 | 8% | 5.6 | 2% |
Total debt and leases / adjusted LTM EBITDA (x) | 0.8 | 0.8 | 2% | 0.8 | 2% |
Net debt / adjusted LTM EBITDA (x) | 0.6 | 0.5 | 14% | 0.5 | 14% |
Adjusted LTM EBITDA / LTM gross interest (x) | 24.3 | 27.1 | -11% | 24.1 | 1% |
¹ Does not include leases (IFRS 16). ² Includes US$ 735 million related to non-current assets held for sale in 1Q24. ³ Includes interest rate swaps. 4 Does not include provision for de-characterization of Germano dam in the amount of US$ 212 million in 1Q24, US$ 219 million in 4Q23 and US$ 203 million in 1Q23. |
Gross debt and leases reached US$ 14.7 billion as of March 31st, 2024, US$ 751 million higher q/q, mainly as a result of new loans raised by Vale Base Metals Ltd. and Vale S.A., within our liability management plan.
Expanded net debt increased by US$ 224 million q/q, totaling US$ 16.4 billion. Vale's expanded net debt target remains at US$ 10-20 billion.
The average debt maturity declined slightly to 7.5 years (compared to 7.9 years at the end of 4Q23). The average annual cost of debt after currency and interest rate swaps was 5.7%, relatively flat q/q.
11 |
Performance of the business segments
Proforma Adjusted EBITDA, by business area
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Iron Ore Solutions | 3,459 | 3,458 | 0% | 6,578 | -47% |
Iron ore fines | 2,507 | 2,696 | -7% | 5,535 | -55% |
Pellets | 882 | 692 | 27% | 936 | -6% |
Other Ferrous Minerals | 70 | 70 | - | 107 | -35% |
Energy Transition Metals¹ | 257 | 573 | -55% | 529 | -51% |
Nickel | 17 | 328 | -95% | 152 | -89% |
Copper | 284 | 220 | 29% | 375 | -24% |
Other | (44) | 25 | n.a. | 2 | n.a. |
Others2,3 | (237) | (206) | 15% | (257) | -8% |
Total | 3,479 | 3,825 | -9% | 6,850 | -49% |
¹ Includes an adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23, to reflect the performance of the streaming transactions at market prices, which will be made until the proceeds received on the streaming transactions are fully recognized in the adjusted EBITDA of the business. Based on the current projections for volumes and commodities prices, it will be fully realized by 2027. ² Including a negative y/y effect of provisions related to communities' programs, reversal of tax credit provisions, and contingency loss. 3 Includes US$ 47 million in unallocated expenses from Vale Base Metals Ltd ("VBM") in 1Q24. Considering the unallocated expenses, VBM's EBITDA was US$ 210 million in 1Q24. |
Segment information 1Q24
Expenses | |||||||||||
US$ million | Net operating revenues | Cost¹ | SG&A and others¹ | R&D¹ | Pre operating & stoppage¹ | Associates & JVs EBITDA | Adjusted EBITDA | ||||
Iron Ore Solutions | 7,025 | (3,552) | (64) | (83) | (64) | 197 | 3,459 | ||||
Iron ore fines | 5,292 | (2,703) | (49) | (70) | (51) | 88 | 2,507 | ||||
Pellets | 1,585 | (739) | 6 | (1) | (5) | 36 | 882 | ||||
Other ferrous | 148 | (110) | (21) | (12) | (8) | 73 | 70 | ||||
Energy Transition Metals | 1,434 | (1,137) | 6 | (51) | (1) | 6 | 257 | ||||
Nickel² | 836 | (773) | (24) | (21) | (1) | - | 17 | ||||
Copper3 | 639 | (329) | (3) | (23) | - | - | 284 | ||||
Other Energy Transition Metals4 | (41) | (35) | 33 | (7) | - | 6 | (44) | ||||
Brumadinho and de-characterization of dams | - | - | (41) | - | - | - | (41) | ||||
Others5 | - | - | (214) | (22) | (1) | - | (237) | ||||
Total | 8,459 | (4,689) | (313) | (156) | (66) | 203 | 3,438 | ||||
¹ Excluding depreciation, depletion and amortization. ² Including copper and by-products from our nickel operations. ³ Including by-products from our copper operations. 4 Includes an adjustment of US$ 67 million increasing the adjusted EBITDA in 1Q24, to reflect the performance of the streaming transactions at market prices, which will be made until the proceeds received on the streaming transactions are fully recognized in the adjusted EBITDA of the business. Based on the current projections for volumes and commodities prices, it will be fully realized by 2027. 5 Includes US$ 47 million in unallocated expenses from Vale Base Metals Ltd ("VBM") in 1Q24. Considering the unallocated expenses, VBM's EBITDA was US$ 210 million in 1Q24. | |||||||||||
12 |
Iron Ore Solutions
Selected financial indicators - Iron Ore Solutions
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net Revenues | 7,025 | 6,411 | 10% | 11,030 | -36% |
Costs¹ | (3,552) | (2,918) | 22% | (4,568) | -22% |
SG&A and Other expenses¹ | (64) | (41) | 56% | 87 | n.a. |
Pre-operating and stoppage expenses¹ | (64) | (89) | -28% | (80) | -20% |
R&D expenses | (83) | (43) | 93% | (104) | -20% |
EBITDA associates & JVs | 197 | 138 | 43% | 213 | -8% |
Adjusted EBITDA | 3,459 | 3,458 | 0% | 6,578 | -47% |
Depreciation and amortization | (481) | (403) | 19% | (549) | -12% |
Adjusted EBIT | 2,978 | 3,055 | -3% | 6,029 | -51% |
Adjusted EBIT margin (%) | 42.4 | 47.7 | -5.3 p.p. | 54.7 | -12.3 p.p. |
¹ Net of depreciation and amortization. |
Iron Ore Solutions EBITDA Variation 1Q24 vs. 1Q23
Drivers | ||||||
US$ million | 1Q23 | Volume | Prices | Others | Total variation | 1Q24 |
Iron ore fines | 2,696 | 424 | (521) | (92) | (189) | 2,507 |
Pellets | 692 | 94 | 67 | 29 | 190 | 882 |
Others | 70 | 6 | 33 | (39) | - | 70 |
Iron Ore Solutions | 3,458 | 524 | (421) | (102) | 1 | 3,459 |
Iron Ore Solutions EBITDA of US$ 3.459 billion was flat y/y, explained by an 8.2 Mt increase in iron ore sales volumes (US$ 524 million), which was offset by lower iron ore fines realized prices (US$ 521 million) and a negative effect of higher spot freight rates and exchange rate on costs (included in "Others" - US$ 102 million negative in the table above).
Revenues
Iron Ore Solutions' volumes, prices, premiums and revenues
1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Volume sold ('000 metric tons) | |||||
Iron ore fines | 52,546 | 45,861 | 15% | 77,885 | -33% |
IOCJ | 9,453 | 11,215 | -16% | 13,074 | -28% |
BRBF | 25,715 | 20,345 | 26% | 45,199 | -43% |
Pellet feed - China (PFC1)1 | 2,536 | 2,632 | -4% | 3,279 | -23% |
Lump | 1,809 | 1,394 | 30% | 1,871 | -3% |
High-silica products | 8,490 | 5,536 | 53% | 8,646 | -2% |
Other fines (60-62% Fe) | 4,543 | 4,739 | -4% | 5,816 | -22% |
ROM | 2,056 | 1,665 | 23% | 2,158 | -5% |
Pellets | 9,225 | 8,133 | 13% | 10,285 | -10% |
Share of premium products2 (%) | 74% | 76% | -2 p.p. | 80% | -6 p.p. |
Average prices (US$/t) | |||||
Iron ore - 62% Fe price | 123.6 | 125.5 | -2% | 128.3 | -4% |
Iron ore - 62% Fe low alumina index | 124.0 | 128.7 | -4% | 128.4 | -3% |
Iron ore - 65% Fe index | 135.7 | 140.3 | -3% | 138.8 | -2% |
Provisional price at the end of the quarter | 102.0 | 126.0 | -19% | 139.1 | -27% |
Iron ore fines Vale CFR reference (dmt) | 111.9 | 121.7 | -8% | 131.6 | -15% |
Iron ore fines Vale CFR/FOB realized price | 100.7 | 108.6 | -7% | 118.3 | -15% |
Pellets CFR/FOB (wmt) | 171.9 | 162.5 | 6% | 163.4 | 5% |
Iron ore fines and pellets quality premium (US$/t) | |||||
Iron ore fines quality premium / (discount) | (1.6) | (1.4) | 14% | (1.1) | 45% |
Pellets weighted average contribution | 3.8 | 3.8 | - | 2.7 | 41% |
Total (all-in premium) | 2.2 | 2.4 | -8% | 1.6 | 38% |
Net operating revenue by product (US$ million) | |||||
Iron ore fines | 5,292 | 4,982 | 6% | 9,212 | -43% |
ROM | 27 | 26 | 4% | 29 | -7% |
Pellets | 1,585 | 1,322 | 20% | 1,680 | -6% |
Others | 121 | 81 | 49% | 109 | 11% |
Total | 7,025 | 6,411 | 10% | 11,030 | -36% |
1 Products concentrated in Chinese facilities. 2 Pellets, Carajás (IOCJ), Brazilian Blend Fines (BRBF) and pellet feed. |
13 |
The all-in premium was US$ 2.2/t, slightly higher q/q and y/y. Given market conditions with a lower price spread for low-grade materials, Vale continued to prioritize the sale of blended and high-silica products in order to maximize its product portfolio value. As a result, the share of premium products in total sales reached 74% in Q1.
Iron ore fines, excluding Pellets and ROM
Revenues & price realization
Price realization iron ore fines - US$/t, 1Q24
Average realized iron ore fines price was US$ 100.7/t, US$ 17.6/t lower q/q, mainly due to: (i) the negative effect of pricing system adjustments (US$ 14.5 lower q/q), mostly related to provisional prices in the current quarter, with 12.9 Mt of sales booked at an average forward price that was lower than the quarter's average price, and (ii) lower average reference price (US$ 4.7 lower q/q).
Iron Ore fines pricing system breakdown (%)
1Q24 | 1Q23 | 4Q23 | |
Lagged | 14 | 19 | 12 |
Current | 61 | 62 | 50 |
Provisional | 25 | 19 | 38 |
Total | 100 | 100 | 100 |
Costs
Iron ore fines cash cost and freight
1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Costs (US$ million) | |||||
Vale's iron ore fines C1 cash cost (A) | 1,446 | 1,222 | 18% | 1,924 | -25% |
Third-party purchase costs¹ (B) | 347 | 222 | 56% | 468 | -26% |
Vale's C1 cash cost ex-third-party volumes (C = A - B) | 1,100 | 1,000 | 10% | 1,456 | -24% |
Sales Volumes (Mt) | |||||
Volume sold (ex-ROM) (D) | 52.5 | 45.9 | 15% | 77.9 | -33% |
Volume sold from third-party purchases (E) | 5.6 | 3.5 | 61% | 7.8 | -28% |
Volume sold from own operations (F = D - E) | 46.9 | 42.3 | 11% | 70.1 | -33% |
Iron ore fines cash cost (ex-ROM, ex-royalties), FOB (US$ /t) | |||||
Vale's C1 cash cost ex-third-party purchase cost (C/F) | 23.5 | 23.6 | -1% | 20.8 | 13% |
Average third-party purchase C1 cash cost (B/E) | 61.4 | 62.8 | -2% | 59.9 | 2% |
Vale's iron ore cash cost (A/D) | 27.5 | 26.7 | 3% | 24.7 | 11% |
Freight | |||||
Maritime freight costs (G) | 860 | 622 | 38% | 1,258 | -32% |
% of CFR sales (H) | 85% | 76% | 9 p.p. | 86% | -1 p.p. |
Volume CFR (Mt) (I = D x H) | 44.5 | 34.9 | 27% | 66.9 | -33% |
Vale's iron ore unit freight cost (US$/t) (G/I) | 19.3 | 17.8 | 9% | 18.8 | 3% |
¹ Includes logistics costs related to third-party purchases |
14 |
Iron ore fines COGS - 1Q24 vs. 1Q23
Drivers | ||||||
US$ million | 1Q23 | Volume | Exchange rate | Others | Total variation | 1Q24 |
C1 cash costs | 1,222 | 186 | 33 | 5 | 224 | 1,446 |
Freight | 622 | 170 | - | 68 | 238 | 860 |
Distribution costs | 147 | 21 | - | (40) | (19) | 128 |
Royalties & others | 206 | 30 | - | 33 | 63 | 269 |
Total costs before depreciation and amortization | 2,197 | 407 | 33 | 66 | 506 | 2,703 |
Depreciation | 245 | 38 | 6 | 4 | 48 | 293 |
Total | 2,442 | 445 | 39 | 70 | 554 | 2,996 |
C1 cash cost variation (excluding 3rd party purchases) - US$/t, 1Q24 vs. 1Q23
Despite the negative impact of the BRL appreciation, Vale's C1 cash cost, ex-third-party purchases, was slightly lower y/y, reaching US$ 23.5/t. The main cost drivers were: (i) lower demurrage costs as a result of improved shipping and more efficient planning of port loading during the rainy season and (ii) higher production volumes, leading to fixed cost dilution.
Vale's maritime freight cost averaged US$ 19.3/t, US$ 6.4/t lower than the Brazil-China C3 route average in Q1. The US$ 0.5/t sequential increase in Vale's freight cost is largely explained by higher spot affreightment rates (US$ 0.6/t higher q/q). CFR sales totaled 44.5 Mt in Q1, representing 85% of total iron ore fines sales.
Expenses
Expenses - Iron Ore fines
US$ millions | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
SG&A | 14 | 15 | -7% | 17 | -18% |
R&D | 70 | 39 | 79% | 90 | -22% |
Pre-operating and stoppage expenses | 51 | 79 | -35% | 67 | -24% |
Other expenses | 35 | 14 | 150% | (112) | n.a. |
Total expenses | 170 | 147 | 16% | 62 | 174% |
15 |
Iron ore pellets
Pellets - EBITDA
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | Comments |
Net revenues / Realized prices | 1,585 | 1,322 | 20% | 1,680 | -6% | Realized prices averaged US$171.9/t in Q1 driven by rising contractual premiums; and (ii) higher average benchmark prices. |
Leased pelletizing plants EBITDA | 36 | 25 | 44% | 36 | 0% | |
Cash costs (Iron ore, leasing, freight, overhead, energy and other) | (739) | (648) | 14% | (768) | -4% | FOB sales were 62% of total sales |
Pre-operational & stoppage expenses | (5) | (5) | 0% | (5) | 0% | |
Expenses (Selling, R&D and other) | 5 | (2) | n.a. | (7) | n.a. | |
EBITDA | 882 | 692 | 27% | 936 | -6% | |
EBITDA/t | 96 | 85 | 12% | 91 | 5% |
Iron ore fines and pellets cash break-even landed in China[5]
Iron ore fines and pellets cash break-even landed in China ("all-in costs")
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Vale's C1 cash cost ex-third-party purchase cost | 23.5 | 23.6 | -1% | 20.8 | 13% | |
Third party purchases cost adjustments | 4.0 | 3.1 | 32% | 3.9 | 4% | |
Vale's iron ore cash cost (ex-ROM, ex-royalties), FOB (US$ /t) | 27.5 | 26.7 | 3% | 24.7 | 11% | |
Iron ore fines freight cost (ex-bunker oil hedge) | 19.3 | 17.8 | 9% | 18.8 | 3% | |
Iron ore fines distribution cost | 2.4 | 3.2 | -24% | 2.0 | 20% | |
Iron ore fines expenses1 & royalties | 6.7 | 6.3 | 5% | 4.4 | 52% | |
Iron ore fines moisture adjustment | 4.9 | 4.9 | - | 4.1 | 20% | |
Iron ore fines quality adjustment | 1.6 | 1.4 | 14% | 1.1 | 45% | |
Iron ore fines EBITDA break-even (US$/dmt) | 62.4 | 60.3 | 3% | 55.1 | 13% | |
Iron ore fines pellet adjustment | (3.8) | (3.8) | 1% | (2.7) | 41% | |
Iron ore fines and pellets EBITDA break-even (US$/dmt) | 58.6 | 56.5 | 4% | 52.4 | 12% | |
Iron ore fines sustaining investments | 11.2 | 9.4 | 19% | 10.9 | 3% | |
Iron ore fines and pellets cash break-even landed in China (US$/dmt) | 69.9 | 65.9 | 6% | 63.3 | 11% | |
¹ Net of depreciation and includes dividends received. Including stoppage expenses. | ||||||
[5]Measured by unit cost + expenses + sustaining investment adjusted for quality. Does not include the impact from the iron ore fines and pellets pricing system mechanism.
16 |
Energy Transition Metals
As previously outlined in the Adjusted EBITDA chapter, additional changes to the reporting practices for the Energy Transition Metals (ETM) segment, effective from the first quarter of 2024 (1Q24), were implemented, please see "Annexes" for detailed information. |
Energy Transition Metals EBITDA overview - 1Q24
US$ million | Sudbury | Voisey's Bay & Long Harbour | PTVI (site) | Standalone Refineries | Onça Puma | Sossego | Salobo | Others | Copper & Nickel | Other ETM¹ | Total Energy Transition Metals |
Net Revenues | 477 | 146 | 230 | 228 | - | 112 | 502 | (220) | 1,475 | (41) | 1,434 |
Costs | (397) | (172) | (170) | (234) | (40) | (91) | (238) | 240 | (1,102) | (35) | (1,137) |
Selling and other expenses | (5) | (4) | - | - | (4) | (1) | (2) | (11) | (27) | 33 | 6 |
Pre-operating and stoppage expenses | - | - | - | - | (1) | - | - | - | (1) | - | (1) |
R&D | (12) | (4) | (2) | - | (1) | (3) | (2) | (20) | (44) | (7) | (51) |
associates and JVs EBITDA | - | - | - | - | - | - | - | - | - | 6 | 6 |
EBITDA | 63 | (34) | 58 | (6) | (46) | 17 | 260 | (11) | 301 | (44) | 257 |
¹ Includes an adjustment of US$ 67 million increasing the adjusted EBITDA in 1Q24, to reflect the performance of the streaming transactions at market prices, which will be made until the proceeds received on the streaming transactions are fully recognized in the adjusted EBITDA of the business. Based on the current projections for volumes and commodities prices, it will be fully realized by 2027. |
Nickel
Selected financial indicators
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net Revenues | 836 | 1,321 | -37% | 1,177 | -29% |
Costs¹ | (773) | (949) | -19% | (980) | -21% |
Selling and other expenses¹ | (24) | (17) | 41% | (9) | 167% |
Pre-operating and stoppage expenses¹ | (1) | - | n.a. | (1) | 0% |
R&D expenses | (21) | (27) | -22% | (35) | -40% |
Adjusted EBITDA | 17 | 328 | -95% | 152 | -89% |
Depreciation and amortization | (184) | (203) | -9% | (236) | -22% |
Adjusted EBIT | (167) | 125 | n.a. | (84) | 98% |
Adjusted EBIT margin (%) | -20.0% | 9.5% | 29.5 p.p. | -7.2% | -12.8 p.p. |
¹ Net of depreciation and amortization. |
EBITDA variation - US$ million (1Q24 vs. 1Q23)
Drivers | |||||||
US$ million | 1Q23 | Volume | Prices | By-products | Others1 | Total variation | 1Q24 |
Nickel | 328 | (12) | (278) | (33) | 12 | (311) | 17 |
¹ Includes variations of (i) US$ 14 million in PPA; (ii) negative US$ 35 million in inventory write-down and (iii) positive US$ 33 million in others. |
EBITDA decreased 95% y/y largely explained by a 33% decrease in nickel realized prices (negative US$ 278 million), and the negative effects of inventory write-down (negative US$ 35 million - included in "Others" in the table above) and maintenance and other fixed costs incurred at Onça Puma in the quarter, as the operations were halted for the furnace rebuild (US$ 39 million - included in "Others" above).
EBITDA by operations
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | 1Q24 vs. 1Q23 Comments |
Sudbury¹ | 63 | 206 | -69% | 88 | -29% | Lower nickel prices partially offset by lower costs. |
Voisey's Bay & Long Harbour | (34) | 25 | n.a. | (34) | 0% | Lower nickel prices partially offset by lower costs. |
Standalone Refineries² | (6) | 47 | n.a. | (19) | -68% | Lower nickel prices partially offset by lower costs. |
PTVI | 58 | 173 | -66% | 100 | -42% | Lower nickel prices partially offset by lower costs. |
Onça Puma | (46) | 19 | n.a. | (24) | 92% | Higher maintenance costs and lower sales volumes due to the furnace rebuild works. |
Others² | (18) | (142) | -87% | 41 | n.a. | |
Total | 17 | 328 | -95% | 152 | -89% | |
¹ Includes the Thompson operations. ² Comprises the sales results for Clydach and Matsusaka refineries. ³ Includes intercompany eliminations, unrealized provisional price adjustments and inventory write-down. Hedge results have been relocated to each nickel business operation. |
17 |
Revenues & price realization
Sales volumes, revenues & price realization
1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | ||
Volume sold ('000 metric tons) | ||||||
Nickel | 33 | 40 | -18% | 48 | -31% | |
Copper | 20 | 20 | 5% | 21 | -4% | |
Gold as by-product ('000 oz) | 12 | 11 | 9% | 11 | 9% | |
Silver as by-product ('000 oz) | 245 | 236 | 4% | 227 | 8% | |
PGMs ('000 oz) | 73 | 74 | -1% | 59 | 24% | |
Cobalt (metric ton) | 465 | 621 | -25% | 492 | -5% | |
Average realized prices (US$/t) | ||||||
Nickel | 16,848 | 25,260 | -33% | 18,420 | -9% | |
Copper | 7,482 | 8,928 | -16% | 7,602 | -2% | |
Gold (US$/oz) | 2,051 | 1,915 | 7% | 2,065 | -1% | |
Silver (US$/oz) | 22.6 | 22.4 | 1% | 25.2 | -10% | |
Cobalt | 30,500 | 32,830 | -7% | 35,438 | -14% | |
Net revenue by product (US$ million) | ||||||
Nickel | 558 | 1,013 | -45% | 888 | -37% | |
Copper | 153 | 174 | -12% | 162 | -6% | |
Gold as by-product¹ | 24 | 21 | 14% | 23 | 4% | |
Silver as by-product | 6 | 5 | 20% | 6 | - | |
PGMs | 68 | 75 | -9% | 71 | -4% | |
Cobalt¹ | 14 | 20 | -30% | 18 | -22% | |
Others | 10 | 12 | -17% | 9 | 11% | |
Total | 833 | 1,321 | -37% | 1,177 | -29% | |
PPA adjustments² | 3 | - | n.a. | - | n.a. | |
Net revenue after PPA adjustments | 836 | 1,321 | -37% | 1,177 | -29% | |
¹ Revenues presented above were adjusted to reflect the market prices of products delivered related to the streaming transactions. ² PPA adjustments started to be disclosed separately in 1Q24. | ||||||
Breakdown of nickel volumes sold, realized price and premium
1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Volumes (kt) | |||||
Upper Class I nickel | 20.8 | 23.9 | -13% | 25.7 | -19% |
- of which: EV Battery | 0.8 | 1.6 | -50% | 0.6 | 33% |
Lower Class I nickel | 3.5 | 4.1 | -15% | 7.2 | -51% |
Class II nickel | 4.4 | 8.1 | -46% | 9.9 | -56% |
Intermediates | 4.5 | 4.1 | 10% | 5.4 | -17% |
Total | 33.1 | 40.1 | -18% | 47.9 | -31% |
Nickel realized price (US$/t) | |||||
LME average nickel price | 16,589 | 25,983 | -36% | 17,247 | -4% |
Average nickel realized price | 16,848 | 25,260 | -33% | 18,420 | -9% |
Contribution to the nickel realized price by category: | |||||
Nickel average aggregate (premium/discount) | 515 | (60) | n.a. | 215 | 140% |
Other timing and pricing adjustments contributions¹ | (256) | (663) | -61% | 958 | -127% |
Premium/discount by product (US$/t) | |||||
Upper Class I nickel | 1,210 | 1,550 | -22% | 1,430 | -15% |
Lower Class I nickel | 650 | 1,340 | -51% | 980 | -34% |
Class II nickel | 750 | (2,770) | n.a. | (1,690) | n.a. |
Intermediates | (3,060) | 5,560 | n.a. | (3,100) | -1% |
¹ Comprises (i) the realized quotational period effects (based on sales distribution in the prior three months, as well as the differences between the LME price at the moment of sale and the LME average price), with a negative impact of US$ 405/t and (ii) fixed-price sales, with a positive impact of US$ 150/t. Note: The hedge position was completely settled by December 2023. |
The average realized nickel price was US$ 16,848/t, down 33% y/y, mainly due to 36% lower LME nickel average price (from US$ 25,983/t to US$ 16,589/t). On a sequential basis, the realized nickel price was down 8.5% mainly as a result of 3.8% lower LME prices (from US$ 17,247/t to US$ 16,589/t). In 1Q24, the average realized nickel price was 1.6% higher than the LME average, mainly due to the 73% share of Class I products in the mix, with average US$ 1,129/t premiums.
Product type by operation
% of sales | North Atlantic¹ | Matsusaka | PTVI | Onça Puma | Total 1Q24 | Total 1Q23 | Total 4Q23 |
Upper Class I | 84.0 | - | - | - | 62.7 | 59.5 | 53.4 |
Lower Class I | 14.0 | - | - | - | 10.5 | 10.1 | 14.9 |
Class II | 1.4 | 98.4 | - | 100 | 13.4 | 20.3 | 20.6 |
Intermediates | 0.7 | 1.6 | 100 | - | 13.5 | 10.1 | 11.2 |
¹ Comprises Sudbury, Clydach and Long Harbour refineries |
18 |
Costs
Nickel COGS - 1Q24 vs. 1Q23
Drivers | ||||||
US$ million | 1Q23 | Volume | Exchange rate | Others | Total variation | 1Q24 |
Nickel operations | 949 | (165) | (1) | (10) | (176) | 773 |
Depreciation | 203 | (34) | - | 14 | (20) | 183 |
Total | 1,152 | (199) | (1) | 4 | (196) | 956 |
Unit cash cost of sales by operation, net of by-product credits
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | 1Q24 vs. 1Q23 Comments |
Sudbury¹,² | 10,638 | 14,321 | -26% | 12,891 | -17% | Higher availability of own source feed: lower purchase costs |
Voisey's Bay & Long Harbour² | 21,323 | 23,593 | -10% | 21,656 | -2% | Lower third-party purchase costs. |
Standalone refineries²,³ | 18,617 | 20,499 | -9% | 19,509 | -5% | Lower matte prices and higher fixed cost dilution. |
PTVI4 | 9,371 | 11,030 | -15% | 9,116 | 3% | Lower maintenance costs and higher fixed cost dilution. |
Onça Puma | n.a | 12,284 | n.a | 17,430 | n.a | No production and sale in the quarter |
¹ Sudbury costs include Thompson costs. ² A large portion of Sudbury, Clydach, Matsusaka and Long Harbour finished nickel production is derived from intercompany transfers, as well as from the purchase of ore or nickel intermediates from third parties. These transactions are valued at fair market value. ³ Comprises the unit cash costs for Clydach and Matsusaka refineries. 4 Refers to nickel matte production cost. |
EBITDA break-even ("all-in costs")
EBITDA break-even
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
COGS ex. 3rd-party feed | 22,418 | 22,434 | 0% | 19,329 | 16% |
COGS¹ | 22,291 | 23,653 | -6% | 20,320 | 10% |
By-product revenues¹ | (8,304) | (7,687) | 8% | (6,003) | 38% |
COGS after by-product revenues | 13,987 | 15,966 | -12% | 14,317 | -2% |
Other expenses² | 1,306 | 1,117 | 17% | 919 | 42% |
Total Costs | 15,293 | 17,083 | -10% | 15,236 | 0% |
Nickel average aggregate (premium) discount | (515) | 60 | n.a. | (215) | 140% |
EBITDA breakeven³ | 14,778 | 17,143 | -14% | 15,021 | -2% |
¹ Excluding marketing activities and inventory write-down. ² Includes R&D associated to operational sites, sales expenses and pre-operating & stoppage. ³ Considering only the cash effect of streaming transactions, nickel operations EBITDA break-even would increase to US$ 15,108/t in 1Q24. |
Unit COGS, excluding 3rd-party feed purchases, was flat y/y as higher own source production volumes were offset by the negative impact of the Onça Puma furnace rebuild.
All-in costs have decreased by 14% y/y, primarily due to: (i) lower 3rd-party feed purchase costs driven by lower nickel prices; (ii) higher unit by-products driven by copper to nickel sales ratio; and (iii) nickel aggregate price premium.
19 |
Copper
Selected financial indicators - Copper operations
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net Revenues | 639 | 524 | 22% | 855 | -25% |
Costs¹ | (329) | (270) | 22% | (427) | -23% |
Selling and other expenses¹ | (3) | (6) | -50% | (9) | -67% |
Pre-operating and stoppage expenses¹ | - | (3) | n.a. | (1) | n.a. |
R&D expenses | (23) | (25) | -8% | (43) | -47% |
Adjusted EBITDA | 284 | 220 | 29% | 375 | -24% |
Depreciation and amortization | (40) | (38) | 5% | (56) | -29% |
Adjusted EBIT | 244 | 183 | 33% | 319 | -24% |
Adjusted EBIT margin (%) | 38.2% | 34.9% | 3.3 p.p. | 37.3% | 0.9 p.p. |
¹ Net of depreciation and amortization |
EBITDA variation - US$ million (1Q24 vs. 1Q23)
Drivers | |||||||
US$ million | 1Q23 | Volume | Prices | By-products | Others1 | Total variation | 1Q24 |
Copper | 220 | 41 | (98) | 66 | 55 | 64 | 284 |
¹ Includes variations of (i) positive US$ 24 million in PPA, (iii) positive US$ 40 million in costs and expenses and (iii) negative US$ 9 million in currency variation. |
EBITDA increased 29% y/y largely explained by the increase in copper and by-products sales volumes attributed to the ramp-up of Salobo 3 and better operational performance at Salobo 1 & 2.
EBITDA by operation
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | 1Q24 vs. 1Q23 Comments |
Salobo | 261 | 186 | 40% | 326 | -20% | Higher sales volumes. |
Sossego | 17 | 52 | -67% | 79 | -78% | Lower copper realized prices. |
Others copper¹ | 6 | (18) | n.a. | (30) | n.a. | |
Total | 284 | 220 | 29% | 375 | -24% | |
¹ Includes US$ 18 million in R&D expenses related to the Hu'u project in 1Q24 and the unrealized provisional price adjustments. |
Revenues & price realization
Sales volumes, revenues & price realization
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Volume sold ('000 metric tons) | |||||
Copper | 56 | 43 | 31% | 76 | -26% |
Gold as by-product ('000 oz) | 85 | 61 | 39% | 114 | -26% |
Silver as by-product ('000 oz) | 188 | 170 | 11% | 286 | -34% |
Average prices (US$/t) | |||||
Average LME copper price | 8,438 | 8,927 | -5% | 8,159 | 3% |
Average copper realized price | 7,687 | 9,465 | -19% | 7,941 | -3% |
Gold (US$/oz)¹ | 2,083 | 1,832 | 14% | 2,131 | -2% |
Silver (US$/oz) | 24 | 22 | 9% | 24 | -2% |
Net revenue (US$ million) | |||||
Copper | 434 | 409 | 6% | 605 | -28% |
Gold as by-product¹ | 176 | 111 | 59% | 243 | -27% |
Silver as by-product | 4 | 4 | 0% | 7 | -43% |
Total | 615 | 524 | 17% | 855 | -28% |
PPA adjustments² | 24 | - | n.a | - | n.a |
Net revenue after PPA adjustments | 639 | 524 | 22% | 855 | -25% |
¹ Revenues presented above were adjusted to reflect the market prices of products delivered related to the streaming transactions. ² PPA adjustments to be disclosed separately from 1Q24 onwards.On March 31st, 2024, Vale had provisionally priced copper sales from Sossego and Salobo totaling 26,876 tons valued at weighted average LME forward price of US$ 8,773/t, subject to final pricing over the following months. |
20 |
Price realization - copper operations
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Average LME copper price | 8,438 | 8,927 | -5% | 8,159 | 3% |
Current period price adjustments¹ | (20) | 228 | n.a. | 546 | n.a. |
Copper gross realized price | 8,418 | 9,155 | -8% | 8,705 | -3% |
Prior period price adjustments² | (210) | 829 | n.a. | (201) | 4% |
Copper realized price before discounts | 8,208 | 9,983 | -18% | 8,504 | -3% |
TC/RCs, penalties, premiums and discounts³ | (522) | (518) | 1% | (563) | -7% |
Average copper realized price | 7,687 | 9,465 | -19% | 7,941 | -3% |
Note: Vale's copper products are sold on a provisional pricing basis , with final prices determined in a future period. The average copper realized price excludes the mark-to-market of open invoices based on the copper price forward curve (unrealized provisional price adjustments) and includes the prior and current period price adjustments (realized provisional price adjustments). ¹ Current-period price adjustments: Final invoices that were provisionally priced and settled within the quarter. ² Prior-period price adjustment: Final invoices of sales provisionally priced in prior quarters. ³ TC/RCs, penalties, premiums, and discounts for intermediate products. |
The average realized copper price was down 19% y/y and 3% q/q mainly due to the positive impact of PPA in 1Q23 and 4Q23, respectively.
Costs
COGS - 1Q24 vs. 1Q23
Drivers | ||||||
US$ million | 1Q23 | Volume | Exchange rate | Others | Total variation | 1Q24 |
Copper operations | 270 | 82 | 8 | (31) | 59 | 329 |
Depreciation | 35 | 10 | 1 | (6) | 5 | 40 |
Total | 305 | 92 | 9 | (37) | 64 | 369 |
Copper operations - unit cash cost of sales, net of by-product credits
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | 1Q24 vs. 1Q23 Comments |
Salobo | 1,738 | 2,856 | -39% | 1,783 | -3% | Higher fixed costs dilution and higher unit by-products revenues. |
Sossego | 5,844 | 5,233 | 12% | 3,822 | 53% | Lower fixed cost dilution and higher maintenance costs. |
EBITDA break-even ("all-in costs")
US$/t | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
COGS | 5,829 | 6,256 | -7% | 5,613 | 4% |
By-product revenues | (3,207) | (2,664) | 20% | (3,269) | -2% |
COGS after by-product revenues | 2,622 | 3,592 | -27% | 2,344 | 12% |
Other expenses¹ | 149 | 354 | -58% | 305 | -51% |
Total costs | 2,771 | 3,946 | -30% | 2,649 | 5% |
TC/RCs penalties, premiums and discounts | 522 | 518 | 1% | 563 | -7% |
EBITDA breakeven²,³ | 3,293 | 4,464 | -26% | 3,212 | 3% |
¹ Includes sales expenses, R&D associated with Salobo and Sossego, pre-operating and stoppage expenses and other expenses. From 1Q24 onwards, excludes Hu'u - historical figures were restated to reflect this change. ² Considering only the cash effect of streaming transactions, copper operations EBITDA break-even would increase to US$ 4,937/t. ³ The realized price to be compared to the EBITDA break-even should be the copper realized price before discounts (US$ 8,208/t), given that TC/RCs, penalties, and other discounts are already part of the EBITDA break-even build-up. |
Unit COGS have decreased by 7% y/y mainly reflecting lower unit costs at Salobo.
All-in costs have decreased by 26%, primarily due to: (i) decrease in unit COGS; and (ii) higher unit by-products revenues, reflecting a higher proportion of Salobo copper concentrates sales in the mix.
21 |
Webcast Information
Vale will host a webcast on Thursday April 25th, 2024, at 11:00 a.m. Brasilia time (10:00 a.m. New York time; 3:00 p.m. London time). Internet access to the webcast and presentation materials will be available on Vale website at www.vale.com/investors. A webcast replay will be accessible at www.vale.com beginning shortly after the completion of the call.
Further information on Vale can be found at: vale.com
Investor Relations
Vale.RI@vale.com
Thiago Lofiego: thiago.lofiego@vale.com
Luciana Oliveti: luciana.oliveti@vale.com
Mariana Rocha: mariana.rocha@vale.com
Patricia Tinoco: patricia.tinoco@vale.com
Pedro Terra: pedro.terra@vale.com
Except where otherwise indicated, the operational and financial information in this release is based on the consolidated figures in accordance with IFRS. Our quarterly financial statements are reviewed by the company's independent auditors. The main subsidiaries that are consolidated are the following: Companhia Portuária da Baía de Sepetiba, Vale Manganês S.A., Minerações Brasileiras Reunidas S.A., Salobo Metais S.A, Tecnored Desenvolvimento Tecnológico S.A., PT Vale Indonesia Tbk, Vale Holdings B.V, Vale Canada Limited, Vale International S.A., Vale Malaysia Minerals Sdn. Bhd., Vale Oman Pelletizing Company LLC e Vale Oman Distribution Center LLC.
This press release may include statements about Vale's current expectations about future events or results (forward-looking statements). Many of those forward-looking statements can be identified by the use of forward-looking words such as "anticipate," "believe," "could," "expect," "should," "plan," "intend," "estimate" "will" and "potential," among others. All forward-looking statements involve various risks and uncertainties. Vale cannot guarantee that these statements will prove correct. These risks and uncertainties include, among others, factors related to: (a) the countries where Vale operates, especially Brazil and Canada; (b) the global economy; (c) the capital markets; (d) the mining and metals prices and their dependence on global industrial production, which is cyclical by nature; and (e) global competition in the markets in which Vale operates. Vale cautions you that actual results may differ materially from the plans, objectives, expectations, estimates and intentions expressed in this presentation. Vale undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information or future events or for any other reason. To obtain further information on factors that may lead to results different from those forecast by Vale, please consult the reports that Vale files with the U.S. Securities and Exchange Commission (SEC), the Brazilian Comissão de Valores Mobiliários (CVM) and, in particular, the factors discussed under "Forward-Looking Statements" and "Risk Factors" in Vale's annual report on Form 20-F.
The information contained in this press release includes financial measures that are not prepared in accordance with IFRS. These non-IFRS measures differ from the most directly comparable measures determined under IFRS, but we have not presented a reconciliation to the most directly comparable IFRS measures, because the non-IFRS measures are forward-looking and a reconciliation cannot be prepared without unreasonable effort.
22 |
Annexes
Simplified financial statements
Income Statement
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net operating revenue | 8,459 | 8,434 | 0% | 13,054 | -35% |
Cost of goods sold and services rendered | (5,367) | (4,949) | 8% | (6,891) | -22% |
Gross profit | 3,092 | 3,485 | -11% | 6,163 | -50% |
Gross margin (%) | 36.6 | 41.3 | -4.7 p.p. | 47.2 | -10.6 p.p. |
Selling and administrative expenses | (140) | (118) | 19% | (146) | -4% |
Research and development expenses | (156) | (139) | 12% | (231) | -32% |
Pre-operating and operational stoppage | (92) | (124) | -26% | (108) | -15% |
Other operational expenses, net | (250) | (219) | 14% | (380) | -34% |
Impairment reversal (impairment and disposals) of non-current assets, net | (6) | (4) | 50% | (121) | -95% |
Operating income | 2,448 | 2,881 | -15% | 5,177 | -53% |
Financial income | 109 | 121 | -10% | 105 | 4% |
Financial expenses | (339) | (320) | 6% | (380) | -11% |
Other financial items, net | (207) | (331) | -37% | (599) | -65% |
Equity results and other results in associates and joint ventures | 124 | (55) | n.a. | (1,152) | n.a. |
Income before income taxes | 2,135 | 2,296 | -7% | 3,151 | -32% |
Current tax | (734) | (218) | 237% | (475) | 55% |
Deferred tax | 286 | (200) | n.a. | (234) | n.a. |
Net income | 1,687 | 1,878 | -10% | 2,442 | -31% |
Net income (loss) attributable to noncontrolling interests | 8 | 41 | -80% | 24 | -67% |
Net income attributable to Vale's shareholders | 1,679 | 1,837 | -9% | 2,418 | -31% |
Net income | 1,687 | 1,878 | -10% | 2,442 | -31% |
Net income (Loss) attributable to Vale's to noncontrolling interests | 8 | 41 | -80% | 24 | -67% |
Net income attributable to Vale's shareholders | 1,679 | 1,837 | -9% | 2,418 | -31% |
Earnings per share (attributable to the Company's shareholders - US$): | |||||
Basic and diluted earnings per share (attributable to the Company's shareholders - US$) | 0.39 | 0.41 | -5% | 0.56 | -30% |
Equity income (loss) by business segment
US$ million | 1Q24 | % | 1Q23 | % | ∆ y/y | 4Q23 | % | ∆ q/q |
Iron Ore Solutions | 58 | 89 | (96) | 109 | n.a. | 21 | 53 | 176% |
Energy Transition Metals | - | - | - | - | - | - | - | - |
Others | 7 | 11 | 8 | (9) | n.a. | 19 | 47 | -63% |
Total | 65 | 100 | (88) | 100 | -174% | 40 | 100 | 63% |
23 |
Balance sheet
US$ million | 3/31/2024 | 3/31/2022 | ∆ y/y | 12/31/2023 | ∆ q/q |
Assets | |||||
Current assets | 17,528 | 14,508 | 21% | 18,700 | -6% |
Cash and cash equivalents | 3,790 | 4,705 | -19% | 3,609 | 5% |
Short term investments | 44 | 53 | -17% | 51 | -14% |
Accounts receivable | 2,233 | 2,687 | -17% | 4,197 | -47% |
Other financial assets | 420 | 381 | 10% | 271 | 55% |
Inventories | 5,195 | 4,992 | 4% | 4,684 | 11% |
Recoverable taxes | 840 | 1,345 | -38% | 900 | -7% |
Judicial deposits | 672 | - | n.a. | 611 | 10% |
Other | 364 | 345 | 6% | 444 | -18% |
Non-current assets held for sale | 3,970 | - | n.a. | 3,933 | 1% |
Non-current assets | 13,446 | 14,785 | -9% | 13,587 | -1% |
Judicial deposits | 669 | 1,255 | -47% | 798 | -16% |
Other financial assets | 336 | 393 | -15% | 593 | -43% |
Recoverable taxes | 1,384 | 1,143 | 21% | 1,374 | 1% |
Deferred income taxes | 9,699 | 10,799 | -10% | 9,565 | 1% |
Other | 1,358 | 1,195 | 14% | 1,257 | 8% |
Fixed assets | 60,703 | 58,254 | 4% | 61,899 | -2% |
Total assets | 91,677 | 87,547 | 5% | 94,186 | -3% |
Liabilities | |||||
Current liabilities | 15,676 | 12,977 | 21% | 14,655 | 7% |
Suppliers and contractors | 5,546 | 4,464 | 24% | 5,272 | 5% |
Loans, borrowings and leases | 1,286 | 354 | 263% | 824 | 56% |
Leases | 192 | 189 | 2% | 197 | -3% |
Other financial liabilities | 1,708 | 1,581 | 8% | 1,676 | 2% |
Taxes payable | 1,698 | 672 | 153% | 1,314 | 29% |
Settlement program ("REFIS") | 492 | 388 | 27% | 428 | 15% |
Provisions for litigation | 117 | 112 | 4% | 114 | 3% |
Employee benefits | 602 | 610 | -1% | 964 | -38% |
Liabilities related to associates and joint ventures | 923 | 2,133 | -57% | 837 | 10% |
Liabilities related to Brumadinho | 1,063 | 1,122 | -5% | 1,057 | 1% |
De-characterization of dams and asset retirement obligations | 1,045 | 785 | 33% | 1,035 | 1% |
Dividends payable | - | - | n.a. | - | n.a. |
Other | 464 | 567 | -18% | 376 | 23% |
Liabilities associated with non-current assets held for sale | 540 | - | n.a. | 561 | -4% |
Non-current liabilities | 36,988 | 35,689 | 4% | 38,550 | -4% |
Loans, borrowings and leases | 11,962 | 11,110 | 8% | 11,647 | 3% |
Leases | 1,234 | 1,331 | -7% | 1,255 | -2% |
Participative shareholders' debentures | 2,621 | 2,846 | -8% | 2,874 | -9% |
Other financial liabilities | 3,043 | 2,805 | 8% | 3,373 | -10% |
Settlement program (REFIS) | 1,515 | 1,856 | -18% | 1,723 | -12% |
Deferred income taxes | 848 | 1,379 | -39% | 870 | -3% |
Provisions for litigation | 885 | 1,244 | -29% | 885 | 0% |
Employee benefits | 1,288 | 1,304 | -1% | 1,381 | -7% |
Liabilities related to associates and joint ventures | 3,267 | 1,266 | 158% | 3,590 | -9% |
Liabilities related to Brumadinho | 1,831 | 2,236 | -18% | 2,003 | -9% |
De-characterization of dams and asset retirement obligations | 6,261 | 6,462 | -3% | 6,694 | -6% |
Streaming transactions | 1,956 | 1,636 | 20% | 1,962 | 0% |
Others | 277 | 214 | 29% | 293 | -5% |
Total liabilities | 52,664 | 48,666 | 8% | 53,205 | -1% |
Shareholders' equity | 39,013 | 38,881 | 0% | 40,981 | -5% |
Total liabilities and shareholders' equity | 91,677 | 87,547 | 5% | 94,186 | -3% |
24 |
Cash flow
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Cash flow from operations | 4,479 | 4,280 | 5% | 5,591 | -20% |
Interest on loans and borrowings paid | (186) | (169) | 10% | (200) | -7% |
Cash received on settlement of Derivatives, net | 43 | 38 | 13% | 325 | -87% |
Payments related to Brumadinho | (135) | (124) | 9% | (417) | -68% |
Payments related to de-characterization of dams | (119) | (78) | 53% | (145) | -18% |
Interest on participative shareholders debentures paid | - | - | n.a. | (106) | n.a. |
Income taxes (including settlement program) paid | (506) | (337) | 50% | (259) | 95% |
Net cash generated by operating activities | 3,576 | 3,610 | -1% | 4,789 | -25% |
Cash flow from investing activities | |||||
Short-term investment | (44) | (55) | -20% | 47 | -194% |
Capital expenditures | (1,395) | (1,130) | 23% | (2,118) | -34% |
Additions to investment | - | (7) | n.a. | (11) | n.a. |
Payments related to Samarco dam failure | (86) | (77) | 12% | (128) | -33% |
Dividends received from joint ventures and associates | 3 | - | n.a. | 99 | -97% |
Payments from disposal of investments, net | - | (67) | n.a. | (72) | n.a. |
Other investment activities, net | 3 | 10 | -70% | (44) | n.a. |
Net cash used in investing activities | (1,519) | (1,326) | 15% | (2,227) | -32% |
Cash flow from financing activities | |||||
Loans and financing: | |||||
Loans and borrowings from third parties | 870 | 300 | 190% | - | n.a. |
Payments of loans and borrowings from third parties | (62) | (39) | 59% | (25) | 148% |
Payments of leasing | (41) | (47) | -13% | (94) | -56% |
Payments to shareholders: | |||||
Dividends and interest on capital paid to Vale's shareholders | (2,328) | (1,795) | 30% | (2,040) | 14% |
Dividends and interest on capital paid to noncontrolling interest | - | (3) | n.a. | (33) | n.a. |
Share buyback program | (275) | (763) | -64% | (44) | 525% |
Net cash used in financing activities | (1,836) | (2,347) | -22% | (2,236) | -18% |
Net increase (decrease) in cash and cash equivalents | 221 | (63) | n.a. | 326 | -32% |
Cash and cash equivalents in the beginning of the period | 3,609 | 4,736 | -24% | 3,967 | -9% |
Effect of exchange rate changes on cash and cash equivalents | (40) | 32 | n.a. | 19 | n.a. |
Effect of transfer to assets held for sale | - | - | n.a. | (703) | n.a. |
Cash and cash equivalents at the end of period | 3,790 | 4,705 | -19% | 3,609 | 5% |
Non-cash transactions: | |||||
Additions to property, plant and equipment - capitalized loans and borrowing costs | 5 | 5 | 0% | 4 | 25% |
Cash flow from operating activities | |||||
Income before income taxes | 2,135 | 2,296 | -7% | 3,151 | -32% |
Adjusted for: | |||||
Provisions (Review of estimates) related to Brumadinho | (6) | - | n.a. | 137 | n.a. |
Provision (Review of estimates) related tode-characterization of dams | (61) | - | - | 153 | n.a. |
Equity results and other results in associates and joint ventures | (124) | 55 | n.a. | 1,152 | n.a. |
Impairment (impairment reversal) and results on disposal of non-current assets, net | 6 | 4 | 50% | 121 | -95% |
Depreciation, depletion and amortization | 714 | 656 | 9% | 855 | -16% |
Financial results, net | 437 | 530 | -18% | 874 | -50% |
Change in assets and liabilities | |||||
Accounts receivable | 1,935 | 1,686 | 15% | (832) | n.a. |
Inventories | (626) | (363) | 72% | 403 | n.a. |
Suppliers and contractors | 378 | (105) | n.a. | (308) | n.a. |
Other assets and liabilities, net | (309) | (479) | -35% | (115) | 169% |
Cash flow from operations | 4,479 | 4,280 | 5% | 5,591 | -20% |
25 |
Reconciliation of IFRS and "non-GAAP" information
(a) Adjusted EBIT
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Net operating revenues | 8,459 | 8,434 | 0% | 13,054 | -35% |
COGS | (5,367) | (4,949) | 8% | (6,891) | -22% |
Sales and administrative expenses | (140) | (118) | 19% | (146) | -4% |
Research and development expenses | (156) | (139) | 12% | (231) | -32% |
Pre-operating and stoppage expenses | (92) | (124) | -26% | (108) | -15% |
Brumadinho event and dam de-characterization of dams | (41) | (111) | -63% | (396) | -90% |
Other operational expenses, net1 | (142) | (73) | 95% | 98 | n.a. |
EBITDA from associates and JVs | 203 | 138 | 47% | 219 | -7% |
Adjusted EBIT | 2,724 | 3,058 | -11% | 5,599 | -51% |
¹ Includes adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23, to reflect the performance of the streaming transactions at market price. | |||||
(b) Adjusted EBITDA | |||||
EBITDA defines profit or loss before interest, tax, depreciation, depletion and amortization. The definition of Adjusted EBITDA for the Company is the operating income or loss plus dividends received and interest from associates and joint ventures, and excluding the amounts charged as (i) depreciation, depletion and amortization and (ii) impairment reversal (impairment and disposals) of non-current assets. However, our adjusted EBITDA is not the measure defined as EBITDA under IFRS and may possibly not be comparable with indicators with the same name reported by other companies. Adjusted EBITDA should not be considered as a substitute for operational profit or as a better measure of liquidity than operational cash flow, which are calculated in accordance with IFRS. Vale provides its adjusted EBITDA to give additional information about its capacity to pay debt, carry out investments and cover working capital needs. The following tables shows the reconciliation between adjusted EBITDA and operational cash flow and adjusted EBITDA and net income, in accordance with its statement of changes in financial position. The definition of Adjusted EBIT is Adjusted EBITDA plus depreciation, depletion and amortization. | |||||
Reconciliation between adjusted EBITDA and operational cash flow | |||||
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Adjusted EBITDA | 3,438 | 3,714 | -7% | 6,454 | -47% |
Working capital: | |||||
Accounts receivable | 1,935 | 1,686 | 15% | (832) | n.a. |
Inventories | (626) | (363) | 72% | 403 | n.a. |
Suppliers and contractors | 378 | (105) | n.a. | (308) | n.a. |
Provisions (Review of estimates) related to Brumadinho | (6) | - | n.a. | 137 | n.a. |
Provisions (Review of estimates) related to de-characterization of dams | (61) | - | n.a. | 153 | n.a. |
Others | (579) | (652) | -11% | (416) | 39% |
Cash flow | 4,479 | 4,280 | 5% | 5,591 | -20% |
Income taxes (including settlement program) paid | (506) | (337) | 50% | (259) | 95% |
Interest on loans and borrowings paid | (186) | (169) | 10% | (200) | -7% |
Payments related to Brumadinho event | (135) | (124) | 9% | (417) | -68% |
Payments related to de-characterization of dams | (119) | (78) | 53% | (145) | -18% |
Interest on participative shareholders' debentures paid | - | - | n.a. | (106) | n.a. |
Cash received on settlement of Derivatives, net | 43 | 38 | 13% | 325 | -87% |
Net cash generated by operating activities | 3,576 | 3,610 | -1% | 4,789 | -25% |
Reconciliation between adjusted EBITDA and net income (loss) | |||||
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Adjusted EBITDA | 3,438 | 3,714 | -7% | 6,454 | -47% |
Depreciation, depletion and amortization | (714) | (656) | 9% | (855) | -16% |
EBITDA from associates and joint ventures | (203) | (138) | 47% | (219) | -7% |
Impairment reversal (impairment) and results on disposals of non-current assets,net¹ | (73) | (39) | 87% | (203) | -64% |
Operating income | 2,448 | 2,881 | -15% | 5,177 | -53% |
Financial results | (437) | (530) | -18% | (874) | -50% |
Equity results and other results in associates and joint ventures | 124 | (55) | n.a. | (1,152) | -111% |
Income taxes | (448) | (418) | 7% | (709) | -37% |
Net income | 1,687 | 1,878 | -10% | 2,442 | -31% |
Net income (loss) attributable to noncontrolling interests | 8 | 41 | -80% | 24 | -67% |
Net income attributable to Vale's shareholders | 1,679 | 1,837 | -9% | 2,418 | -31% |
¹ Includes adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23 to reflect the performance of the streaming transactions at market price. | |||||
(c) Net debt | |||||
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Gross debt | 13,248 | 11,464 | 16% | 12,471 | 6% |
Leases | 1,426 | 1,520 | -6% | 1,452 | -2% |
Cash and cash equivalents¹ | (4,569) | (4,758) | -4% | (4,363) | 5% |
Net debt | 10,105 | 8,226 | 23% | 9,560 | 6% |
¹ Includes US$ 735 million related to non-current assets held for sale in 1Q24 due to the PTVI divestment and US$ 703 million in 4Q23. |
26 |
(d) Gross debt / LTM Adjusted EBITDA | ||||||
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Gross debt and leases / LTM Adjusted EBITDA (x) | 0.8 | 0.8 | 2% | 0.8 | 2% | |
Gross debt and leases / LTM operational cash flow (x) | 0.9 | 0.7 | 21% | 0.8 | 6% | |
(e) LTM Adjusted EBITDA / LTM interest payments | ||||||
US$ million | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Adjusted LTM EBITDA / LTM gross interest (x) | 24.3 | 27.1 | -11% | 24.1 | 1% | |
LTM adjusted EBITDA / LTM interest payments (x) | 23.5 | 22.1 | 6% | 24.2 | -3% | |
(f) US dollar exchange rates | ||||||
R$/US$ | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q | |
Average | 4.9515 | 5.1963 | -5% | 4.9553 | 0% | |
End of period | 4.9962 | 5.0804 | -2% | 4.8413 | 3% | |
27 |
Revenues and volumes
Net operating revenue by destination
US$ million | 1Q24 | % | 1Q23 | % | ∆ y/y | 4Q23 | % | ∆ q/q |
North America | 427 | 5.0 | 653 | 7.7 | -35% | 473 | 3.6 | -10% |
USA | 243 | 2.9 | 511 | 6.1 | -52% | 358 | 2.7 | -32% |
Canada | 184 | 2.2 | 142 | 1.7 | 30% | 115 | 0.9 | 60% |
South America | 1,128 | 13.3 | 1,067 | 12.7 | 6% | 1,014 | 7.8 | 11% |
Brazil | 1,006 | 11.9 | 919 | 10.9 | 9% | 927 | 7.1 | 9% |
Others | 122 | 1.4 | 148 | 1.8 | -18% | 87 | 0.7 | 40% |
Asia | 5,170 | 61.1 | 4,726 | 56.0 | 9% | 9,497 | 72.8 | -46% |
China | 3,674 | 43.4 | 3,407 | 40.4 | 8% | 7,672 | 58.8 | -52% |
Japan | 682 | 8.1 | 689 | 8.2 | -1% | 863 | 6.6 | -21% |
South Korea | 206 | 2.4 | 312 | 3.7 | -34% | 390 | 3.0 | -47% |
Others | 608 | 7.2 | 318 | 3.8 | 91% | 572 | 4.4 | 6% |
Europe | 1,008 | 11.9 | 1,563 | 18.5 | -36% | 1,282 | 9.8 | -21% |
Germany | 326 | 3.9 | 428 | 5.1 | -24% | 368 | 2.8 | -11% |
Italy | 19 | 0.2 | 183 | 2.2 | -90% | 96 | 0.7 | -80% |
Others | 663 | 7.8 | 952 | 11.3 | -30% | 818 | 6.3 | -19% |
Middle East | 266 | 3.1 | 238 | 2.8 | 12% | 343 | 2.6 | -22% |
Rest of the World | 460 | 5.4 | 187 | 2.2 | 146% | 445 | 3.4 | 3% |
Total | 8,459 | 100.0 | 8,434 | 100.0 | 0% | 13,054 | 100.0 | -35% |
Volume sold by destination - Iron ore and pellets
'000 metric tons | 1Q24 | 1Q23 | ∆ y/y | 4Q23 | ∆ q/q |
Americas | 9,785 | 10,151 | -4% | 9,667 | 1% |
Brazil | 8,762 | 8,749 | 0% | 8,912 | -2% |
Others | 1,023 | 1,402 | -27% | 755 | 35% |
Asia | 46,872 | 38,058 | 23% | 73,341 | -36% |
China | 36,309 | 28,295 | 28% | 60,180 | -40% |
Japan | 5,065 | 5,545 | -9% | 6,825 | -26% |
Others | 5,498 | 4,218 | 30% | 6,336 | -13% |
Europe | 3,317 | 5,168 | -36% | 2,941 | 13% |
Germany | 776 | 964 | -20% | 654 | 19% |
France | 589 | 1,080 | -45% | 685 | -14% |
Others | 1,952 | 3,124 | -38% | 1,602 | 22% |
Middle East | 1,407 | 1,240 | 13% | 1,815 | -22% |
Rest of the World | 2,446 | 1,042 | 135% | 2,564 | -5% |
Total | 63,827 | 55,659 | 15% | 90,328 | -29% |
Net operating revenue by business area
US$ million | 1Q24 | % | 1Q23 | % | ∆ y/y | 4Q23 | % | ∆ q/q |
Iron Ore Solutions | 7,025 | 83% | 6,411 | 76% | 10% | 11,030 | 84% | -36% |
Iron ore fines | 5,292 | 63% | 4,982 | 59% | 6% | 9,212 | 71% | -43% |
ROM | 27 | 0% | 26 | 0% | 4% | 29 | 0% | -7% |
Pellets | 1,585 | 19% | 1,322 | 16% | 20% | 1,680 | 13% | -6% |
Others | 121 | 1% | 81 | 1% | 49% | 109 | 1% | 11% |
Energy Transition Metals | 1,434 | 17% | 1,998 | 24% | -28% | 1,982 | 15% | -28% |
Nickel | 558 | 7% | 1,013 | 12% | -45% | 888 | 7% | -37% |
Copper | 587 | 7% | 583 | 7% | 1% | 767 | 6% | -24% |
PGMs | 68 | 1% | 75 | 1% | -9% | 71 | 1% | -4% |
Gold as by-product¹ | 137 | 2% | 97 | 1% | 42% | 185 | 1% | -25% |
Silver as by-product | 10 | 0% | 9 | 0% | 11% | 13 | 0% | -23% |
Cobalt¹ | 10 | 0% | 21 | 0% | -48% | 16 | 0% | -31% |
Others² | 64 | 1% | 200 | 2% | -69% | 42 | 0% | 50% |
Others | - | 0% | 25 | 0% | -100% | 42 | 0% | -100% |
Total of continuing operations | 8,459 | 100% | 8,434 | 100% | 0% | 13,054 | 100% | -35% |
¹ Exclude the adjustment of US$ 67 million in 1Q24, US$ 35 million in 1Q23 and US$ 82 million in 4Q23, related to the performance of streaming transactions at market price. ² Includes marketing activities. |
28 |
Projects under evaluation and growth options
Copper | ||
Alemão | Capacity: 60 ktpy | Stage: FEL3 |
Carajás, Brazil | Growth project | Investment decision: 2025 |
Vale's ownership: 100% | Underground mine | 115 kozpy Au as byproduct |
South Hub extension (Bacaba) | Capacity: 60-80 ktpy | Stage: FEL3¹ |
Carajás, Brazil | Replacement project | Investment decision: 4Q24 |
Vale's ownership: 100% | Open pit | Development of mines to feed Sossego mill |
Victor | Capacity: 20 ktpy | Stage: FEL3 |
Ontario, Canada | Replacement project | Investment decision: 2025 |
Vale's ownership: N/A | Underground mine | 5 ktpy Ni as co-product; JV partnership under discussion |
Hu'u | Capacity: 300-350 ktpy | Stage: FEL2 |
Dompu, Indonesia | Growth project | 200 kozpy Au as byproduct |
Vale's ownership: 80% | Underground block cave | |
North Hub | Capacity: 70-100 ktpy | Stage: FEL1 |
Carajás, Brazil | Growth project | |
Vale's ownership: 100% | Mines and processing plant | |
Nickel | ||
Sorowako Limonite | Capacity: 60 ktpy | Stage: FEL3 |
Sorowako, Indonesia | Growth project | Investment decision: 2Q24 |
Vale's ownership: N/A² | Mine + HPAL plant | 8 kpty Co as by-product |
Creighton Ph. 5 | Capacity: 15-20 ktpy | Stage: FEL3 |
Ontario, Canada | Replacement project | Investment decision: 2025 |
Vale's ownership: 100% | Underground mine | 10-16 ktpy Cu as by-product |
CCM Pit | Capacity: 12-15 ktpy | Stage: FEL3 |
Ontario, Canada | Replacement project | Investment decision: 2024-2025 |
Vale's ownership: 100% | Open pit mine | 7-9 ktpy Cu as by-product |
CCM Ph. 3 | Capacity: 5-10 ktpy | Stage: FEL3 |
Ontario, Canada | Replacement project | Investment decision: 2025 |
Vale's ownership: 100% | Underground mine | 7-13 ktpy Cu as by-product |
CCM Ph. 4 | Capacity: 7-12 ktpy | Stage: FEL2 |
Ontario, Canada | Replacement project | 7-12 ktpy Cu as by-product |
Vale's ownership: 100% | Underground mine | |
Nickel Sulphate Plant | Capacity: ~25 ktpy | Stage: FEL3 |
Quebec, Canada | Growth project | Investment decision: 2024-2025 |
Vale's ownership: N/A | ||
Iron ore | ||
Concentration Plant | Capacity: 12-15 Mtpy pellet feed | Stage: FEL3 |
Sohar, Oman | Asset-light partnership | Investment decision: 2024 |
Vale's ownership: N/A | Located next to Oman's pellet plant | |
Green briquette plants | Capacity: Under evaluation | Stage: FEL3 (two plants) |
Brazil and other regions | Growth project | Investment decision: 2024-2029 |
Vale's ownership: N/A | Cold agglomeration plant | 8 plants under engineering stage, including co-located plants in clients' facilities |
Serra Leste expansion | Capacity: +4 Mtpy (10 Mtpy total) | Stage: FEL2 |
Northern System (Brazil) | Growth project | |
Vale's ownership: 100% | Open pit mine | |
S11C | Capacity: Under evaluation | Stage: FEL2 |
Northern System (Brazil) | Growth project | |
Vale's ownership: 100% | Open pit mine | |
Serra Norte N1/N23 | Capacity: Under evaluation | Stage: FEL1 |
Northern System (Brazil) | Replacement project | |
Vale's ownership: 100% | Open pit mine | |
Mega Hubs | Capacity: Under evaluation | Stage: Prefeasibility Study |
Middle East | Growth project | |
Vale's ownership: N/A | Industrial complexes for iron ore concentration and agglomeration and production of direct reduction metallics | Vale signed three agreements with Middle East local authorities and clients to jointly study the development of Mega Hubs |
1 Refers to the most advanced projects (Bacaba and Cristalino). 2 Indirect ownership through Vale's 44.34% equity in PTVI. PTVI will own 100% of the mine and has the option to acquire up to 30% of the plant as part of the JV agreement. 3 Project scope is under review given permitting constraints. |
29 |
Revised Reporting Practices for the Energy Transition Metals (ETM) Segment
As previously outlined in the Adjusted EBITDA chapter, additional changes to the reporting practices for the Energy Transition Metals (ETM) segment, effective from the first quarter of 2024 (1Q24), were implemented. These changes are part of the ongoing efforts to enhance financial transparency and provide stakeholders with a more accurate and detailed view of the segment's underlying economic performance. These adjustments will make the financial reporting more reflective of the true operational results and support better-informed decision-making. These changes are detailed below:
Operational Results Reporting: The operational results for each business unit (e.g. Sudbury, Salobo, etc.) within the copper and nickel segments will now be reported excluding certain accounting remeasurements and other non-operational impacts. Specifically, remeasurements such as the non-realized effect of provisional price adjustment (PPA), inventory write-downs, and other non-operational transactions not directly associated with each business unit. Instead, these items will be grouped and reported under a separate category labelled "Others" within the copper and nickel segments.
Marketing results: All marketing-related results will now be consolidated and reported under the "Other ETM" category.
General and Administrative Costs: General and Administrative (G&A) expenses related to the administration of Vale Base Metals will no longer be included in the Adjusted EBITDA as non-allocated. These costs will now be reported separately under the "Other ETM" category to provide clearer visibility into the core performance of the segment.
These changes are intended to streamline reporting and improve the transparency of operational cost structures within the ETM segment. The ETM segment results from previous quarters have not been restated to reflect these new reporting practices.
30 |
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Vale S.A. (Registrant) | ||
By: | /s/ Thiago Lofiego | |
Date: April 24, 2024 | Director of Investor Relations |
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Disclaimer
Vale SA published this content on 25 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 April 2024 10:07:22 UTC.