Soaring metal bank Miner records profits

UK-Australian miner BHP Billiton set a profits record for an Australian company today as it benefited from soaring metal prices and demand from China and India.

Record annual production volumes for aluminium, copper, iron ore, nickel and natural gas also buoyed Billiton, which posted profits of $10.45bn (€8.1bn) in the year to June 30, up 63% on a year ago.

It is the third year in a row of record profits from the business, which lists its shares in London and Australia.

As well as favourable market conditions, Billiton pointed out that investment of $15m (€7.9) on organic growth and acquisitions over the past five years had resulted in volume increases of around 38%.

It expects demand from Asia to continue to drive the business.

In a statement, Billiton said: “China’s economic growth is expected to remain strong, even if attempts to cool strong growth are successful.”

One analyst described the annual results as “excellent”, although the performance was not enough to prevent shares falling 3% as investors booked profits following a strong run for the world’s largest miner in recent days.

The City also noted caution from the company over the possible impact of geopolitical tensions, rising energy prices and any supply disruptions.

A note from brokerage Kepler Teather & Greenwood Merrion said: “The outlook statement was resolutely positive, although the company expects rates of growth to slow as high energy prices and rising interest rates start to bite.

“However, given the almost complete absence of new sources of supply for most commodities, prices are expected to remain high for an extended period.”