Brazilian mining giant Vale (VALE, Financial) reported a 15% drop in net profit for the third quarter compared to the previous year. This decline was primarily due to falling steel raw material prices and provisions related to the Mariana dam collapse. However, the company still achieved a net profit of $2.41 billion, surpassing analysts' expectations of $1.65 billion.
Despite a 10% decrease in net revenue to $9.55 billion, which was close to analysts' estimate of $9.44 billion, Vale's adjusted EBITDA came in at $3.62 billion, an 18% year-over-year decrease but slightly above the forecast of $3.61 billion. Vale's iron ore production in the third quarter hit its highest level since 2018, although the actual prices for iron ore fines fell by 14%.
The company also anticipated more than $900 million in new liabilities related to the deadly dam collapse near Mariana in the third quarter. Notably, Vale plans to sign a $30 billion compensation agreement with BHP and Samarco to address the aftermath of this incident.
Despite the challenges, Vale's financial performance demonstrated resilience, exceeding market expectations.
