Home
  
Mining major BHP Billiton reports dip in profits
Uzbekistan News.Net
Wednesday 8th February, 2012
MELBOURNE - Global mining major BHP Billiton is planning a rethink on its focus areas for investments including the American shale gas venture, with weakening global commodity prices pulling down the company's first half profits compared to last year.
The company's $9.3 billion first-half profit reported Wednesday is 5.5 per cent weaker than the $10.52 billion first-half profit last year.
Presenting the results, BHP Billiton chief Marius Kloppers outlined plans to continue offloading "underperforming" assets in a bid to maintain profitability in the face of adverse market conditions.
"The capacity for this organization to redirect, adapt and steer things while keeping the overall cash investment and cash generated at relatively stable levels, we believe is unparalleled in the industry," Kloppers said.
Kloppers indicated that a rethink may be in offing for the company's aluminium division, which has recorded a $67 million loss in the six months to December 31. There is currently no optimism of an improvement in the short term.
"We have to continue to watch the evolution of that structural change there is no sense in trying to let something hang around on the balance sheet if it doesn't want to be there," Kloppers said.
A rethink on the American shale gas venture, less than a year after investing almost $20 billion in the acquisition, may also be in offing with BHP Billiton chief announcing plans to increase the petroleum division's focus on liquids such as oil.
A drop in US gas prices in recent months is behind the pressure on BHP to shift focus from shale gas. The company has already scaled back its shale gas exploration and drilling programme. Kloppers stressed that the drop in gas prices had been offset by improved conditions for oil production.
The iron ore and petroleum divisions dominated the result, generating more than 75 per cent of $14.6 billion in earnings before interest and tax.
Stressing on need to have long-term strategy, which provide "more predictability", rather than react to commodity price changes, Kloppers announced plans to invest a very significant capital in the BHP's Bowen Basin joint-venture coalmines.
The announcement is seen as a warning to unions threatening to strike work at the Bowen Basin.
Have your say on this story
|
|
