BHP Billiton Profit Dives 86% Due to Commodity Slump

August 25, 2015

BHP Billiton reported a net profit of $1.91 billion for the year through June, down from $13.83 billion in the 12 months earlier, an 86 percent year-over-year drop.

The price of commodities including coal, oil and iron ore have tumbled to multiyear lows in recent weeks. Production increases from projects planned when prices were booming have led to global over-supply, at a time when the economy in China, the world's biggest buyer of many resources, is retracting.

Billiton said it would give shareholders a final payout of $0.62 a share, increasing its full-year payout 2 percent to $1.24.

“We will cut costs further and exercise our growing capital flexibility to improve our competitiveness and support our progressive dividend policy,” says CEO Andrew Mackenzie.

The company reported productivity gains of $4.1 billion, two years ahead of target. More cuts are planned for 2016.