Higher Payouts Seen as BHP Combats Cost Creep -- Earnings Preview
20 Agosto 2018 - 5:58AM
Dow Jones News
By Rhiannon Hoyle
BHP Billiton Ltd. (BHP.AU) will report its fiscal-year earnings
before the Australian market opens on Tuesday. Here's what you need
to know:
REVENUE FORECAST: The world's largest mining company by market
value is expected to record revenue of US$45.66 billion for the 12
months through June. That would be up from US$38.29 billion in the
year-earlier period, according to a median of nine analyst
forecasts.
PROFIT FORECAST: BHP is expected to post a profit before one-off
items of US$8.80 billion, up from US$6.73 billion a year earlier,
according to the analysts' predictions.
---WHAT TO WATCH---
CAPITAL RETURNS: BHP should follow rivals including Rio Tinto
PLC (RIO.LN) in boosting investor returns as the company benefits
from firmer commodity markets, an ongoing productivity drive and
gains from asset sales. The analyst forecasts point to a full-year
dividend of around US$1.15 a share. That would be up from US$0.83 a
year earlier. BHP has also pledged to give proceeds from the sale
of its U.S. onshore oil-and-gas unit--to be offloaded in deals with
BP PLC and Merit Energy Co. for a combined US$10.8 billion--back to
shareholders, although it isn't expecting to get that cash until
the end of October. When announcing those deals last month, BHP
said it had yet to decide on whether it would put the money toward
dividends or buybacks.
COSTS: Investors will also be keeping a close eye on comments
about mining costs, given recent remarks from rivals that bills for
power and other necessities are getting bigger. Shares in Rio
Tinto, the world's No. 2 mining company, fell sharply after its
first-half earnings report earlier this month as investors focused
on higher costs, even the company announced a record interim
dividend and plans to repurchase more shares.
CHARGES: One-time charges will once again weigh on BHP's bottom
line. The miner has already flagged expectations of a roughly
US$2.8 after-tax--or US$2.9 billion pretax--impairment charge
against the carrying value of the U.S. onshore assets it's selling
to BP and Merit Energy.
Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com
(END) Dow Jones Newswires
August 19, 2018 23:43 ET (03:43 GMT)
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