Lower commodity prices hurt profits at miner BHP

The world’s biggest miner yesterday said annual profits fell by more than a third after weaker economic growth reduced prices for its key commodities.

BHP Billiton’s net profit for the year to June 30 was 15.4 billion US dollars (£9.8bn), compared with 23.6 billion US dollars a year ago. Revenues were broadly flat at 72.2 billion US dollars (£45.8bn).

The Melbourne-based firm also announced it was delaying the expansion of a copper and uranium mine in southern Australia due to lower commodity prices and higher capital costs.

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BHP said it expects more near-term volatility in commodity markets amid weakness in the manufacturing and construction sectors.

However, it added: “In the medium term we expect supportive economic policy and a broad growth bias, particularly in China, to lead to measured improvement in the external environment beginning in the first half of the 2013 financial year.”

BHP also produces aluminium, iron ore, manganese, nickel, silver and titanium minerals and has substantial interests in oil and gas.

It operates from 100 locations and has 100,000 employees and contractors.

BHP raised its final dividend by 2 cents to 57 cents, but that was below analysts’ forecasts of 58 cents, which was seen as another sign of caution on the outlook.

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