BHP annual profit jumps 33 percent, misses forecast

By Reuters / August 20, 2018 / www.mining.com / Article Link

The world's biggest miner, BHP, said on Tuesday its full-year profit jumped 33 percent, helped mainly by robust oil and base metals prices.

Underlying profit for the full year ended June 30 rose to $8.93 billion from $6.73 billion a year earlier. That missed an estimate of $9.27 billion according to 15 analysts polled by Thomson Reuters I/B/E/S.

Underlying profit is watched by analysts and investors as a measure of the company's core performance exclusive of one-time gains and losses.

Including these items, profit fell 37 percent to $3.71 billion, which reflected a one-off shale charge of about $2.8 billion post-tax.

That charge arises from the sale of its U.S. shale oil and gas assets to BP Plc at a better than expected price of $10.5 billion in July, which ended a disastrous seven-year foray into shale on which the company effectively wasted $19 billion of shareholders' funds.

"Across our dramatically simplified portfolio of tier one assets, we see this year's strong momentum carried into the medium term," said Chief Executive Andrew Mackenzie.

The statutory profit also reflects a charge of $650 million in its fiscal 2018 results following the 2015 Samarco dam failure in Brazil that killed 19 people.

Total Revenue rose 20 percent during the period to $45.81 billion.

Revenue from iron ore mining, its biggest division, rose meagrely by 1.3 percent, while copper revenues rose nearly 60 percent backed by higher production from its Escondida mine in Chile.

The miner had reported record iron ore output for fiscal 2018 in July and set a slightly higher target for the current year. It set a fiscal 2019 production target of 273-283 million tonnes.

Revenue from its petroleum division grew 14.5 percent during the period on surging oil prices.

BHP said it cut net debt to $10.9 billion during the period, in the lower end of its $10-15 billion target.

Australia's biggest company by market value declared a final dividend of $0.63 per share, up from $0.43 a share last year.

(Reporting by Rushil Dutta in Bengaluru Editing by Matthew Lewis).

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