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Annual profit drops 7 pct at Australia's Orica, dividend disappoints

Published 04/11/2016, 08:54 am
Updated 04/11/2016, 09:00 am
© Reuters.  Annual profit drops 7 pct at Australia's Orica, dividend disappoints
ORI
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MELBOURNE, Nov 4 (Reuters) - Orica Ltd ORI.AX , the world's top supplier of commercial explosives, reported a 7 percent drop in annual underlying profit on Friday, in line with analysts' forecasts, but paid a weaker dividend than expected.

The company said conditions remained volatile in the second half of the year, despite sharp improvements in commodity prices helping its customers.

"While there has been some external optimism on market conditions, we remain conservative and will continue to focus on business improvement initiatives that improve profitability and shareholder value," Orica said.

Net profit before one-offs fell to A$389 million ($299 million) for the year to September from A$417 million a year ago. Analysts had expected a net profit of A$385 million, according to Thomson Reuters I/B/E/S.

Orica's final dividend of 29 cents was 4.5 cents below analysts' forecasts.

The company in May ditched its policy of never cutting dividends and switched to a payout ratio of 40 to 70 percent of underlying earnings to shore up its balance sheet and stave off a credit downgrade.

($1 = 1.3019 Australian dollars)

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