Vale (NYSE: VALE) posted a loss of $1.68 billion in 2019, compared to a net income of $6.860 billion in 2018, the Brazilian miner reported on Thursday.
The $8.5 billion decrease was mostly driven by provisions and expenses related to the Brumadinho dam rupture that killed more than 230 people in January 2019.
“We have… an effective reparation program, relevant governance and operational improvements, and a decharacterization – process by which the structure of a dam is reincorporated into the relief and the environment – plan for our upstream tailings dams under accelerated implementation” said CEO Eduardo Bartolomeo in the media release.
“We are de-risking Vale. We are paving the way to make our business better, safer and more stable,” he said.
Vale reported a $1.56 billion net loss in the fourth quarter. A Refinitiv poll of analysts had predicted a net profit of $2.61 billion.
That miss was largely due to a $2.51 billion impairment at its nickel mine in New Caledonia, where Vale has revised down expected production levels due to “challenging issues” related to “production and processing.”
Vale also recognized a $1.69 billion charge at a coal mine in Mozambique for similar reasons and a previously announced $671 million charge to “decharacterize” some dams similar to the one that burst last year.
Earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted for some one-off items, totaled $3.53 billion. Vale said EBITDA was hit by about $900 million in Brumadinho-related provisions.
(With files from Reuters)