Mining giant BHP has posted a 37 per cent drop in full-year year net profit after writedowns on its oil business but will pay shareholders a record final dividend.
The miner’s net profit for the year to June 30 fell to $US3.70 billion ($A5.10 billion), after impairments and charges worth $US5.2 billion.
The impairments related to costs and writedowns from the Samarco dam disaster in Brazil, US tax reforms and the company’s troublesome US oil business.
Underlying profit for the company rose 33 per cent to $US8.93 billion, missing analyst expectations for profit of around $9.1 billion.
BHP declared a fully-franked final dividend of 63 US cents a share, 20 US cents higher than a year ago and equal to 69 per cent of underlying profit.
Chief executive Andrew Mackenzie said the increased dividend reflected the group’s strong financial position, with low debt and disciplined growth plans within its self-imposed $US8 billion ceiling.
“Given that we’re now at the bottom end of our net debt target, that means that any excess cash, over and above the ($US8 billion) of course, can be returned to the shareholder,” he said.
Mr Mackenzie said BHP had nine significant projects under way and was spending almost $US1 billion on exploration.
“So we are really pulling the growth lever pretty hard,” he said.
“We continue to improve our capital efficiency and if you look at what you’re getting for your money right now, it’s pretty impressive.
BHP announced in July that it was selling its US shale assets to British petroleum giant BP and US group Merit Energy in a $US10.8 billion deal.
Revenue for the year rose 21 per cent to to $US43.64 billion, helped by higher production and stronger copper, coal and oil prices.
BHP’s full-year iron ore production was three per cent higher at 275 million tonnes, while copper output jumped 32 per cent. However, the petroleum division posted an eight per cent fall in production.
The company recorded a loss of $US650 million related to the 2015 Samarco dam failure in Brazil.
BHP shares were down 60 cents, or 1.8 per cent, to $32.56 at 1215 AEST.
BHP MISSES PROFIT ESTIMATES
*Net profit down 37pct to $US3.7b
*Revenue up 21pct to $US43.6b
* Underlying profit up 33pct to $US9.6b
* Fully franked final dividend 63 US cents vs 43 US cents year ago