BHP Billiton Full-Year Profit Declines 30% After Prices Fall
BHP Billiton Ltd. (BHP), the world’s biggest mining company, said full-year profit slumped 30 percent after prices declined.
Net income dropped to $10.9 billion in the year to June 30 from $15.4 billion a year ago, the Melbourne-based company said today in a statement. Profit, excluding one-time items, was $11.8 billion, compared with $17.2 billion a year ago. That missed a median forecast of $12.7 billion of seven analyst surveyed by Bloomberg.
BHP joins Rio Tinto Group and Vale SA in reporting a decline in profit as slowing economic growth in China saps demand for raw materials, dragging down prices. BHP Chief Executive Officer Andrew Mackenzie is targeting an 18 percent drop in capital spending this fiscal year as investors including BlackRock Inc. (BLK) pressure mining companies to defer expansions, new mines and acquisitions after the industry was hurt by more than $60 billion in writedowns.
“The equity market is looking for the miners to cut spending and increase returns,” Glyn Lawcock, a Sydney-based analyst for UBS AG, said in a report before the results. “It’s been a tough year for BHP.”
BHP fell 1.4 percent to A$36.54 at the close of trading in Sydney.
To contact the reporter on this story: Elisabeth Behrmann in Sydney at email@example.com
To contact the editor responsible for this story: Jason Rogers at firstname.lastname@example.org