BHP Billiton’s net profit almost halves in H1

Australian mining company BHP Billiton has announced its financial results for the first half ended December 31of the current financial year.
 
According to the company's financial statement, BHP Billiton's net profit for the first fiscal half was almost reduced by half. The company's net profit amounted to US$4.26 billion, down 47.4 percent, while the company's revenue decreased by 11.9 percent year on year to US$29.9 billion.
 
BHP Billiton's Western Australia iron ore production increased by 15 percent to a record 114 million mt in the first half of the financial year, as the ramp-up of Jimblebar continued and the availability, utilization and rate of the integrated supply chain were improved. The Western Australia iron ore operations continue to perform strongly and the production guidance is maintained at 245 million mt for the full financial year.
 
Regarding metallurgical coal, BHP Billiton indicated that China's seaborne demand declined following a rise in domestic supply. Although several producers outside China have announced production cuts, the volume removed from the market has been less than anticipated and surplus supply is expected to persist in the short term.
 
"We started to prepare for a sustained period of lower prices almost three years ago by increasing our focus on efficiency and lowering our investment. Since then, we have achieved annualized productivity gains approaching US$10 billion and reduced capital spending by almost 40 percent. We have seen rapid improvement across all of our major businesses. For example, in the last six months alone we have cut unit costs at Western Australia Iron Ore by 29 percent to nearly US$20/mt," said Andrew Mackenzie, BHP Billiton chief executive officer.