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BHP Billiton profit dives to 10-year low on commodities rout

Published 25/08/2015, 04:46 pm
© Reuters.  BHP Billiton profit dives to 10-year low on commodities rout

MELBOURNE, Aug 25 (Reuters) - BHP Billiton BHP.AX BLT.L reported a 52 percent slump in annual profit on Tuesday to a decade low, gutted by plunging iron ore, copper, coal and oil prices, and said it would cut spending more deeply to shore up dividends.

The world's biggest miner said its underlying attributable profit fell to $6.42 billion for the year to June from $13.26 billion a year earlier. The result was below analysts' forecasts around $7.73 billion.

Net profit dropped 86 percent, as BHP took $2.9 billion in post-tax charges that it previously flagged, mainly on its U.S. shale and Nickel West businesses.

The miner reiterated its pledge to never cut its dividend, and lowered its target for capital spending for the year to June 2016 to $8.5 billion from $9 billion previously to help meet the promise.

"While we recorded a sector-leading EBITDA margin of 50 per cent, we will cut costs further and exercise our growing capital flexibility to improve our competitiveness and support our progressive dividend policy through the cycle," Chief Executive Andrew Mackenzie said in a statement.

BHP spun off the company South32 S32.AX to shareholders in May with a string of unloved assets as it sought to simplify down to four main commodities - iron ore, copper, coal and petroleum - but has been hit by sliding prices for all four due to slowing growth in China.

BHP raised its full year dividend to $1.24 from $1.21, which was less than analysts' forecasts around $1.27.

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