Brazil’s Vale SA on Thursday reported a $1.64 billion quarterly net loss as the world’s top iron ore miner struggled with the aftermath of one of the country’s deadliest mining disasters.
The first-quarter loss was driven by a series of provisions for the cost of the disaster, including $2.42 billion for compensation and remediation programs and $1.86 billion for shutting down dams.
The company shuttered various mines after the dam at Brumadinho collapsed in late January, unleashing a torrent of toxic mud that buried nearby buildings, including a company cafeteria, killing at least 237 people.
Vale, which had posted a net profit of $1.59 billion in the year-ago period, also reported a $652 million loss before interest, taxes, depreciation and amortization for the period, its first-ever quarterly loss on an EBITDA basis.
Quarterly revenue fell 4.6% to $8.20 billion due to weaker sales as several key mines were taken offline in the wake of the disaster.
Under pressure from prosecutors for failing to do enough to prevent the disaster, Vale named company veteran Eduardo Bartolomeo to replace Fabio Schvartsman as chief executive. The miner also included an additional independent member on its board in the months following the dam burst.
“I am committed to leading Vale through the most challenging moment in its history,” Bartolomeo said in a statement issued with the quarterly results.
(By Christian Plumb and Marta Nogueira; Editing by Lisa Shumaker and Peter Cooney)