BHP Bil­li­ton posts huge US$6.39 bil­lion loss

The Myanmar Times - - International Business -

BHP Bil­li­ton re­ported yes­ter­day an an­nual net loss of US$6.39 bil­lion, its worst-ever re­sult, as the im­pact of a fa­tal mine dam disas­ter in Brazil and weak com­mod­ity prices hit the world’s big­gest miner.

Min­ers have been bat­tling huge de­clines in the com­modi­ties mar­ket, with the out­look un­cer­tain de­spite a re­cent im­prove­ment in prices.

The re­sults for the year to June 30 fol­lowed a $1.91 bil­lion net profit in the pre­vi­ous cor­re­spond­ing pe­riod. Un­der­ly­ing earn­ings, which strip out one-off write­downs, came in at $1.22 bil­lion, slightly above an­a­lysts’ ex­pec­ta­tions.

“The last 12 months have been chal­leng­ing for both BHP Bil­li­ton and the re­sources in­dus­try,” chief ex­ec­u­tive An­drew Macken­zie said in a state­ment.

“Nev­er­the­less, our re­sults de­mon­strate the re­silience of our port­fo­lio and the di­verse ways in which we can cre­ate value for share­hold­ers de­spite low com­mod­ity prices.”

The An­glo-Aus­tralian com­pany slashed its pay­out, declar­ing a fi­nal div­i­dend of 14 cents, com­pared to 62 cents last year.

It fol­lowed the com­pany’s de­ci­sion in Fe­bru­ary to dump its pro­gres­sive div­i­dend pol­icy in which share­hold­ers are given grad­u­ally higher pay­outs.

The chal­leng­ing mar­ket out­look saw global rat­ings agency Stan­dard & Poor’s down­grade BHP’s rat­ing from A+ to A in Fe­bru­ary.

Mr Macken­zie said de­spite ex­pec­ta­tions that com­mod­ity prices would “re­main low and volatile in the short- to medium-term”, he was con­fi­dent about the long-term out­look, par­tic­u­larly for oil and cop­per.

At the same time, BHP has been grap­pling with the af­ter­math of the Sa­marco dam rup­ture in Novem­ber in which 19 peo­ple died.

Sa­marco, which is co-owned by Brazil­ian min­ing gi­ant Vale, is fac­ing bil­lions of dol­lars in le­gal claims for clean-up costs and dam­ages.

BHP said its losses in­cluded a $4.9 bil­lion write­down on the value of some US as­sets and a $2.2 bil­lion loss re­lat­ing to the Sa­marco dam fail­ure in Brazil.

The com­pany’s share price closed 0.45 per­cent higher to A$20.25, ahead of the profit an­nounce­ment.

South32, which was spun off from BHP last year and which has as­sets in­clud­ing alu­minium, coal, nickel, man­ganese, sil­ver, lead and zinc, is set to re­port its earn­ings on Au­gust 25. –

Photo: EPA

BHP Bil­li­ton re­ported an an­nual net loss of US$6.39 bil­lion on Au­gust 16, 2016 its worst-ever re­sult, as the im­pact of a fa­tal mine dam disas­ter in Brazil and weak com­mod­ity prices hit the world's big­gest miner.

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