More Australian Miners Lower Outlook and Take Earnings Charges

Marcus Jacob
29 Jul, 2013
New York City

Australian indexes closed higher in thin trading and more mining companies warned of tougher times ahead. Newcrest Mining credit rating was cut. OZ Minerals announced a one-time charge. Rio Tinto agreed to sell a stake in a copper mine to a China based company.

[R]5:00 PM Sydney – Australian indexes closed higher in thin trading and more mining companies warned of tougher times ahead. Newcrest Mining credit rating was cut. OZ Minerals announced a one-time charge. Rio Tinto agreed to sell a stake in a copper mine to a China based company.[/R]

Australian stocks managed to close higher and more mining companies announced earnings warnings and lowered outlook.

The ASX 200 index edged up 4.30 to close at 5,046.30 and the broader All Ordinaries rose 4.10 to 5,027.90.

Australian dollar lowered to 92.56 U.S. cents and in stock trading turnover plummeted to 522 million shares worth $2.8 billion.

Stocks in Review

Rio Tinto fell 13 cents to $57.11 after the mining company plans to cut costs and debt, plan to sell its 80% stake in the Northparkes copper mine in Australia to China based Molybdenum Co valued $820 million.

BHP slid 5 cents to $34.55.

Woodside Petroleum Limited fell 28 cents to $37.50 after the oil and gas producer lowered its production target by as much as 9.6% after the technical issue with unplanned shutdown in liquefied natural gas processing unit at its $15 billion Pluto project and delay in vessel refurbishment.

David Jones Limited closed unchanged at $2.65 and Breville Group up 1 cent to $7.45. Woolworths gained 16 cents to $33.77.

Mirvac Group added 1 cent to $1.71. Lend Lease climbed 19 cents to $8.96.

Westpac increased 30 cents to $30.82 and Commonwealth rose 0.3% to $73.86. National Australia Bank advanced 16 cents to $31.16. ANZ jumped 23 cents to $29.64.

Leighton Holdings Limited slipped 1.2% to $16.28 after the company’s subsidiary Thiess agreed to acquire 50% stake of Silcar Pty Ltd. from German engineering and technology conglomerate Siemens AG for an undisclosed amount.

Newcrest Mining, Ltd. dropped 2.1% to $12.15 for the year the gold producer expects to to write-down gold asset to in the range of $350 million to $400 million.

OZ Minerals Limited fell 1.9% to $4.05 after the mining company expects non-cash after-tax asset impairment charge for the first-half profit to decline between $200 million and $240 million on lower copper and gold prices.

Transpacific Industries Group Ltd surged 7.9% to 88.5 cents after the waste management company sell off its commercial vehicles group Western Star Trucks Australia to the U.S. based automotive retailer Penske Automotive Group, the for $219 million to reduce the debt.

The Penske Automotive expects acquisition to generate about $420 million to $460 million in revenues.