BHP reported a 23% decline in its first-half profit as lower prices for iron ore owing to slowing demand from China’s property sector offset higher contributions from copper mining, said The Times.
The Australian group reported underlying attributable profit of $5.08bn for the six months to the end of December, below analyst estimates of $5.39bn and lower than the $6.57bn reported last year.
It declared an interim dividend of 50 cents per share, in line with forecasts, but below the 72 cents per share a year ago and the lowest payout since 2017.
The company sounded a cautiously optimistic note about demand prospects for its two main products, the steel ingredient iron ore, and copper, which has grown to account for nearly half of its profits.
“Central banks’ ongoing rate cuts are expected to translate into a recovery for steel and copper demand across the Organisation for Economic Co-operation and Development in the near term,” the miner said.
“However, potential trade tensions present a risk to the recovery in developed economies and across the globe.”
Earnings from iron ore – BHP’s biggest profit-generating commodity – declined 26% to $7.2bn as the average realised price fell to $81.11 per ton from $103.7 a year ago, said The Times.
Copper’s underlying operating earnings jumped 44% to $5bn as tight fundamentals, Chinese stimulus plans and interest rate cuts in the US kept copper prices elevated.
“The demand for BHP products remains strong despite global economic and trade uncertainties, with early signs of recovery in China, resilient economic performance in the US and strong growth in India,” said Mike Henry, CEO of BHP.
