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BHP reports after-tax profit rose 87% to $3.76B in the half-year through December, its best result in four years, but underlying profit fell 85% for the period to $4.03B - below analyst consensus estimate of $4.21B - and revenues rose just 1% Y/Y to $20.74B.
- BHP continued to generate solid cash flow from its mines and oil fields and maintained its interim dividend of $0.55/share, exceeding analyst expectations.
- The miner reports mixed H1 production of its main commodities: BHP produced 2% more iron ore than a year earlier but its average realized iron ore fell by 2% as underlying EBITDA from the division edged up by $34M to $4.3B, while copper output slipped 1% and prices fell by 18% from the prior year, causing underlying earnings from the division to tumble ~40%.
- BHP cut its productivity guidance to flat for the financial year, mainly due to $460M in savings that were not achieved because of unplanned production outages at Olympic Dam, Western Australia Iron Ore, Spence and Nickel West; it slightly raises its full-year copper production forecast to 1.6M-1.7M metric tons.
- BHP says it cut net debt to $9.9B during the half year, below its $10B-$15B target.
- CEO Andrew Mackenzie says BHP's commodity sales have yet to be directly hit by the U.S.-China trade conflict, but the company sees a further rise in protectionist policies as a key risk to its 3.25%-3.75% forecast for global growth this year.