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BHP Billiton looks beyond record loss

Tuesday, August 16, 2016 - 01:46

BHP Billiton - the world's biggest mining company - has reported a record $6.4 billion annual loss, hammered by a bad bet on shale, a dam disaster in Brazil and a commodities slump. But as Hayley Platt reports, it still expects its cash flow to more than double this year.

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BHP Billiton is digging itself out of a hole. And it's a big one - the full year loss at the world's largest mining company was $6.4 billion. It's been dealing with a huge writedown following last year's Samarco dam disaster- which killed 19 people. And falling commodity prices, not to mention a bad bet on U.S. shale. Excluding $7.7 billion in writedowns and charges, underlying profit slumped 81 percent to $1.2 billion, although shares still went up. (SOUNDBITE) (English): DARREN SINDEN, INDEPENDENT MARKET ANALYST, SAYING: "The fact that in a relatively difficult environment they still made an operating profit excluding the writedowns is a positive sign. And they've saved around 414 million US dollars of costs over the last year." Company chief Andrew Mackenzie said it was too early to say if the worst was over for the resources industry. But he hoped the "free fall" was at least at an end. He said BHP remained committed to its U.S. shale wells - even though they've taken a big hit from falling oil prices. But the full year dividend will suffer BHP will pay 30 cents after abandoning a long-held policy of never cutting dividends earlier this year. (SOUNDBITE) (English): DARREN SINDEN, INDEPENDENT MARKET ANALYST, SAYING: "If that's just a one off for this year, that's not so bad but if that sets the trend going forward then people will have to consider they're involvement in BHP shares." BHP's confident it can reduce slightly higher than expected debt. But there are questions over its promise to diversify. BHP's iron ore business was the main generator of profit - coal also reporting a loss.

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BHP Billiton looks beyond record loss

Tuesday, August 16, 2016 - 01:46