Antofagasta Retains Copper Outlook, BHP Profit Tumbles 86%

Nigel Thomas
25 Aug, 2015
New York City

Antofagasta profit more than doubled to $705.8 million but revenues plunged 31%. BHP Billiton net tumbled 86% and the miner lowered production outlook. Mitsubishi Electric agreed to acquire a majority stake in DeLClima. ICA Gruppen offered to increase its stake in Hemtex.

[R]4:00 PM Frankfurt – Antofagasta profit more than doubled to $705.8 million but revenues plunged 31%. BHP Billiton net tumbled 86% and the miner lowered production outlook. Mitsubishi Electric agreed to acquire a majority stake in DeLClima. ICA Gruppen offered to increase its stake in Hemtex.[/R]

European markets rebounded and halted global sell-off that knocked off many indexes near bear territory.

In London trading, FTSE 100 index jumped 164.30 or 2.8% to 6,063.73 and in Frankfurt the DAX index soared 436.73 or 4.5% to 10,085.76.

In Paris, CAC 40 index advanced 172.46 or 3.9% to 4,552.68.

Antofagasta Plc soared 6.3% to 566.50 pence after the Chile-based copper miner reported revenues in the first-half ending in June plunged 31.4% to $1.79 billion from $2.60 billion in a year ago period.

Net profit in the period more than doubled from a year ago to $705.8 million compared to $330.8 million and earnings per share increased to 71.6 cents from 33.6 cents.

The miner maintained its forecast of copper output for the year of about 665,000 tons.

BHP Billiton Plc jumped 4.6% to 1,011.50 pence after the Australia-based mining company reported total revenues in the year ending in June declined 21.4% to US$44.64 billion from US$56.76 billion a year ago period.

Net income in the quarter tumbled 86.2% to US$1.9 billion compared to US$13.8 billion and diluted earnings per share dropped to 65.3 cents from 255.7 cents in the same period a year ago.

Petroleum production in the year jumped 4% to 255.7 million barrels of oil equivalent and total iron ore production soared 13% to 232.5 million tons and metallurgical coal which used in steel making surged 13% to 42.6 million tons from a year ago period.

The miner said net operating cash flow in the year of about US$17.8 billion but free cash flow dropped 26% to US$6.3 billion.

BHP said net debt in the year fell 5% to US$24.4 billion on cost cutting of US$4 billion, two years ahead of schedule. Capital and exploration expenditure declined 24% to US$11 billion.

BHP forecasted petroleum production for fiscal 2016 to decline 7% to 237 million barrels of oil equivalent and copper output to drop 12% to 1.5 million tons while metallurgical coal production to fall 6% to 40 million tons and energy coal production to slid 2% to 40 million tons.

DeLClima SpA surged 82.1% to €4.37 after the Italy-based air-conditioning and heating systems parent De’Longhi Industrial S.A. agreed to sell 74.97% stake to Japan-based Mitsubishi Electric Corporation for about €664 million or $768 million in cash.

The transaction is expected to close by the end of November.

ICA Gruppen AB jumped 2.7% to 301.30 Swedish kronor after the Sweden-based food retailer offered 7.50 kronor in cash per share of the remaining stake in Hemtex AB or for about 719 million kronor.

The offer represents a premium of 44% from the closing price of Hemtex on August 24.

RSA Insurance Group Plc jumped 4.6% to 517.50 pence after the U.K.-based general insurer received a revised cash proposal from the rival Zurich Insurance Group of 550 pence per share, valuing the company at about £5.5 billion or $8.69 billion.