BHP shares take hit with $ 5b wiped off market value
BHP Billiton shares have taken their biggest one- day slide in almost a year, wiping $ 5 billion off the group’s market value.
Shares in the mining titan tumbled 5 per cent yesterday in their biggest fall for any session since last March.
It came after the group released its first- half results after the market closed on Tuesday, revealing higher- thanexpected costs had weighed on earnings.
BHP’s underlying profit — which strips out one- off costs — clocked in at $ US4.05 billion ($ 5.14 billion) for the six months to December.
Fuelled by higher oil and copper prices, it was up 25 per cent on the same period a year earlier.
But it fell short of market expectations for a $ US4.25 billion haul because of increased costs.
Those costs included a $ US493 million “negative productivity movement” because of maintenance at the Olympic Dam copper and uranium mine in South Australia and its Queensland coal operations.
“The result did not quite meet market expectations, which was largely due to oneoffs such as smelter maintenance at Olympic Dam, a fire at WA Iron Ore, and writeoffs at Escondida,” UBS analyst Glyn Lawcock said.
UBS has nonetheless boosted its price target for BHP shares, noting the miner said it would achieve $ US7 billion of free cash flow this half at current commodity prices.
BHP shares fell $ 1.55 yesterday to $ 29.75.