OREANDA-NEWS. Released this Wednesday, April 30th, Vale's performance in 1Q14 showed strong operational performance. Iron ore production reached 71.1 Mt, the best performance for a first quarter since 2008, and Vale also registered production of 67,500 tons for nickel and 1.8 Mt for coal, production records for a first quarter.

Adjusted EBITDA totaled UUSD 4.1 billion, and net income, UUSD 2.515 billion. Generation of cash flow this quarter was affected by a more challenging price environment and by adjustments in prices of iron ore sales from the fourth quarter of last year (4Q13) in relation to the 1Q14 price. This happens when the price of iron ore, which is estimated at the time of sale, ends up being different from the price realized when the ship effectively arrives at the client.

The base metals segment produced a very healthy EBITDA, reaching UUSD 549 million, more than double the UUSD 243 million generated in 4Q13, driven by the record production of nickel at Onca Puma, in Para, and at Vale Caledonia, as well as by a good performance from Salobo I.

"We were very pleased with base metals performance and cash flow generation and we expect even better results for the second quarter with a recovery in nickel prices", stated the Luciano Siani, Executive Director for Finance and Investor Relations Officer, in the video on the1Q14 results.

Continuous and consistent cost reductions

The 1Q14 results also show a significant reduction in costs and expenses, with a reduction of UUSD 218 million when compared to the first quarter of 2013 (1Q13), following the trend seen in recent results. General and administrative expenses fell by 20% and sustaining capex fell 30% in relation to 1Q13.