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Orica halves dividend as profit drops, outlook worsens

Published 09/05/2016, 09:08 am
Updated 09/05/2016, 09:10 am
© Reuters.  Orica halves dividend as profit drops, outlook worsens
ORI
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MELBOURNE, May 9 (Reuters) - Orica Ltd ORI.AX , the world's largest maker of mine explosives, slashed its dividend in half to shore itself up against a prolonged mining slump after reporting a 10 percent fall in underlying half-year profit.

After predicting a year ago that 2015 would mark the trough for the mining downturn, Orica Chief Executive Alberto Calderon said on Monday conditions had worsened in January and February this year.

"Market conditions deteriorated more than we anticipated during the half, marked by increased volatility. It is expected that the market will remain challenged for the foreseeable future," Calderon said in a statement.

Underlying profit for the six months to March fell to A$190 million ($140 million) from A$211 million a year earlier, in line with a forecast of A$191 million from Macquarie.

Orica sliced its interim dividend to 20.5 cents a share from 40 cents a year ago, and said it would pay out 40 to 70 percent of underlying earnings each year, with the total dividend weighted toward the second half of the year.

($1 = 1.3569 Australian dollars)

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