BHP announced that its annual profit fell to its lowest level in five years. Weak demand from China weighed on iron ore prices, prompting the company to signal cuts in capital and exploration spending. However, a higher-than-expected dividend payment led to a 1% rise in shares.
The company’s profit fell 26% to $10.16 billion in the fiscal year ending June 31. While revenue from iron ore fell by 19%, this loss was partially offset by the rise in copper prices. BHP announced a total annual dividend of $1.10, the lowest since 2017, exceeding analyst expectations. Analysts considered the higher dividend payout rate a positive sign. The company also raised its debt target to $10-20 billion and stated it would explore growth opportunities, particularly in areas such as copper and potash. $11 billion in investment and exploration is planned for the next two years.
BHP CEO Mike Henry emphasized that commodity demand has remained resilient despite uncertainties in trade policies.
