By Andre Romani and Roberto Samora
SAO PAULO (Reuters) -Brazilian miner Vale reported on Wednesday a $694 million loss in the fourth quarter, missing estimates and swinging from a hefty profit a year earlier, as it logged impairments on some of its base metals assets in Canada.
Vale, one of the world's largest iron ore producers, also announced fresh remuneration to shareholders through dividends and a share buyback, which analysts welcomed, and cut its planned spending estimate for this year.
The firm's quarterly net loss, far below the $1.95 billion profit expected by analysts in a LSEG poll and the $2.4 billion profit a year earlier, was hit by impairments of $1.4 billion on its Thompson nickel operations and $540 million on a project to expand its Voisey's Bay mine, both in Canada.
Vale noted the impairments followed a review of assets in Vale Base Metals, which last month said it had started a "strategic review" of its nickel assets in Thompson, including their potential sale.
Vale's core profit as measured by adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at $3.79 billion in the quarter, down 41% and below analysts' estimate of $3.96 billion.
Excluding the impairments and one-offs, Vale's net profit would have reached $872 million in the quarter, still 64% lower year-on-year amid a decline in iron ore prices and sales volumes.
Vale announced a dividend of about 2.14 reais per share and a share buyback of up to 120 million shares, up to 3% of its share base, to be carried out over 18 months.
Santander analysts welcomed "solid results", citing operating numbers that do not include the impairment and other one-offs.
"We expect a positive market reaction on the back of a stronger-than-expected shareholder remuneration, and the new buyback program," they wrote in a note to clients.
Itau BBA analysts also expected a positive market reaction, noting a quarter of the announced dividends are extraordinary payments.
Vale last month released its sales and production report, which showed a near 5% decline in its quarterly iron ore output compared to a year earlier, with the company prioritizing higher-margin products.
Still, the miner notched its highest annual production since 2018 in the year.
Vale said its net revenue in the fourth quarter came in at $10.1 billion, down 22% and mostly in line with analysts' expectations.
In a separate filing on Wednesday, Vale trimmed its projected capital expenditures for this year from about $6.5 billion to some $5.9 billion, mostly on lower planned investments in growth and energy-transition metals.
(Reporting by Andre Romani; Editing by Kylie Madry and Sonali Paul)