BHP 1st Half Net Profit Falls by 32% on Weaker Commodity Prices
20 Fevereiro 2023 - 07:12PM
Dow Jones News
By Rhiannon Hoyle
BHP Group Ltd. reported a 32% fall in first-half net profit and
pared its interim dividend from a record-high level, mostly because
of weaker prices for some of the commodities it sells including
steel ingredient iron ore and industrial metal copper.
The world's largest miner by market value said it made a net
profit of $6.46 billion in the six months through December. It made
a profit of $9.44 billion in the same period a year earlier, when
strong commodity prices boosted its bottom line.
BHP said its underlying attributable profit--a closely watched
measure that strips out exceptional items to illustrate the
underlying performance of the business--totaled $6.60 billion, down
32% on the year-prior period. The market expected an underlying
profit of roughly $6.82 billion, according to 15 analyst forecasts
compiled by Vuma Financial.
"Significant wet weather in our coal assets impacted production
and unit costs, as did challenges in securing sufficient labor,"
Chief Executive Mike Henry said.
Directors declared an interim dividend of $0.90 a share,
compared to a record midyear payout of $1.50 a share a year
The earnings decline mainly reflected a downswing in commodity
prices during the six-month period, he said.
Prices for iron ore, BHP's most lucrative commodity, tumbled to
a three-year low late last year amid concerns about the state of
China's property market and the outlook for the global economy. The
average price the miner got for its iron ore was 25% below the
For its copper, another core business, the miner was paid 19%
less than the same period in 2021.
In recent months, prices for those commodities have been rising
once more, as China has sought to stabilize its real-estate market
and emerge from almost three years of strict Covid-19 controls.
"We are positive about the demand outlook in the second half of
FY23 and into FY24, with strengthening activity in China on the
back of recent policy decisions the major driver," Mr. Henry said.
"We expect domestic demand in China and India to provide
stabilizing counterweights to the ongoing slowdown in global trade
and in the economies of the U.S., Japan and Europe."
BHP has been seeking to increase its exposure to commodities
such as copper that it expects to be in high demand as the world
decarbonizes and electrifies.
The company in December signed an agreement to buy Australian
copper miner OZ Minerals Ltd. in what would be its biggest
acquisition in more than a decade. The OZ Minerals board has
unanimously recommended shareholders vote in favor of the deal,
which gives the company an enterprise value of 9.6 billion
Australian dollars, or roughly $6.6 billion.
Write to Rhiannon Hoyle at email@example.com
(END) Dow Jones Newswires
February 20, 2023 16:57 ET (21:57 GMT)
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