Finance Finance News BHP Billiton profits plummet

BHP Billiton profits plummet

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BHP Billiton half-year profits have fallen by almost 50 per cent, in a stark illustration of the plummeting price of iron ore and oil.

Nevertheless, the half year attributable (after tax) profit was still a huge US$4.67 billion, or AU$6 billion. That is by far the largest half-year profit announced in Australia this year.

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The resources giant calculated its underlying profit – a figure which discounts costs the company considers unreflective of the overall position – even higher, at US$5.35 billion (AU$6.86 billion).

Shareholders, including almost everyone who is a member of an Australian super fund, will receive a dividend of 60 cents per share.

Overall, the company sold US$29.9 billion (AU$38.3 billion) worth of commodities. Interestingly, that figure is quite close to the amount of merchandise sold by Wesfarmers over the same period (AU$31.79).

Wesfarmers, however, only managed to milk AU$1.3 billion worth of profits for the half year.

While BHP’s result was a massive drop from last year’s US$8.1 billion, it is a stronger performance than many analysts were expecting.

BHP Billiton chief executive Andrew Mackenzie said: “Despite falls in the prices of our main commodities over the last six months, Group margins remain healthy, free cash flow has increased and we have strengthened our balance sheet.

“We are confident that we can maintain our progressive dividend policy and continue to selectively invest in projects that offer compelling returns.”

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