B08 Metal Ore Mining

Mackenzie defends dual purpose

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Original article by Paul Garvey
The Australian – Page: 22 : 20-Feb-19

US hedge fund Elliott Management recently argued that there is no reason for BHP to retain its dual-listed structure following a 2018 settlement with the Australian Taxation Office regarding its Singapore marketing hub. However, BHP CEO Andrew Mackenzie says other factors would need to be taken into account when deciding the future of its dual listing. Amongst other things, BHP would be removed from the FTSE Index if it were to have a primary listing in Australia, which may result in many UK investors existing its share register.

CORPORATES
BHP GROUP LIMITED – ASX BHP, ELLIOTT MANAGEMENT CORPORATION, AUSTRALIAN TAXATION OFFICE, FTSE 100 INDEX

BHP resists ramp-up as prices surge

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Original article by Paul Garvey
The Australian – Page: 19 & 22 : 20-Feb-19

BHP has posted an underlying profit of $US3.8bn ($5.3bn) for the first half of 2018-19, which is slightly below the consensus forecast of analysts. Underlying EBITDA also fell slightly short of expectations at $US10.5bn. Meanwhile, CEO Andrew Mackenzie says BHP will not increase its iron ore output despite a rally in the price of the steel input in the wake of the tailings dam disaster in Brazil in January. Shareholders will receive a higher-than-expected interim dividend of $US0.55 per share.

CORPORATES
BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, RBC CAPITAL MARKETS

Earnings hit tipped for BHP

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Original article by Paul Garvey
The Australian – Page: 20 : 19-Feb-19

BHP will post a net profit of $US3.9bn for the first half of 2018-19, according to the consensus forecast of analysts. This compares with $US4.1bn for the previous corresponding period. EBITDA is tipped to fall from $US12.8bn to $US10.6bn, although an expected strong rise in the petroleum division’s EBITDA will help offset the underperformance elsewhere in BHP’s portfolio. Meanwhile, BHP’s interim dividend is expected to fall from $US0.55 per share to $US0.53, although the downturn in the Australian dollar will boost the dividend payout of local investors.

CORPORATES
BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA

Investors win from BHP, Rio cash surge

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Original article by James Thomson
The Australian Financial Review – Page: 40 : 18-Feb-19

BHP returned $US10.5bn to investors in 2018, while Rio Tinto returned some $US12.5bn. Both resources groups are expected to have large cash balances when their latest financial results are released in the next week or so, and the recent rally in the iron ore price will further boost their cash holdings during 2019. James Eginton of the Tribeca Natural Resource Fund says BHP and Rio Tinto should consider using some of their franking credits via special dividends in the next six months, in preparation for a possible change of federal government.

CORPORATES
BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, TRIBECA NATURAL RESOURCES FUND, FORTESCUE METALS GROUP LIMITED – ASX FMG, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, VALE SA, AUSTRALIAN LABOR PARTY

Bigger isn’t better says CEO as Newcrest doubles its profit

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Original article by Paul Garvey
The Australian – Page: 20 : 15-Feb-19

Newcrest Mining has posted a 2018-19 interim net profit of $US237m ($334m), compared with $US98m previously. CEO Sandeep Biswas says the gold miner is well-placed to capitalise on any acquisition opportunities, but stresses that a deal would have to add value for shareholders. Biswas adds that mining companies should not pursue mergers and acquisitions simply to become larger unless the deal will add value. Newcrest shareholders will receive an interim dividend of $US0.075 per share.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, NEWMONT MINING CORPORATION, GOLDCORP INCORPORATED, BARRICK GOLD CORPORATION, RANDGOLD RESOURCES LIMITED, LUNDIN MINING CORPORATION, SOLGOLD PLC

Olympic Dam gains major development status from SA

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Original article by Simon Evans
The Australian Financial Review – Page: 2 : 15-Feb-19

BHP is expected to decide in late 2020 whether to proceed with a $2.7 billion expansion of its Olympic Dam copper and uranium mine in South Australia. The SA government advised on 14 February that any expansion of the mine would be granted major development status. The proposed expansion would see mining and production increase from 200,000 tonnes a year to 350,000 tonnes a year, and would involve an increased take of water from the Great Artesian Basin.

CORPORATES
BHP GROUP LIMITED – ASX BHP, WMC RESOURCES LIMITED, SOUTH AUSTRALIA. DEPT OF ENVIRONMENT, WATER AND NATURAL RESOURCES

Rising gold price makes Evolution think twice about acquisitions

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Original article by Brad Thompson
The Australian Financial Review – Page: 18 : 14-Feb-19

Evolution Mining has reported a 2018-19 interim net profit of $92m, down from $122.5m previously. Executive chairman Jake Klein anticipates further consolidation in the gold sector and he says the mid-tier miner is open to acquisitions. However, he stresses that Evolution will only consider assets that enhance the company’s portfolio and add value for shareholders. Meanwhile, Northern Star Resources has posted an interim net profit of $82m and revenue of $633.5m.

CORPORATES
EVOLUTION MINING LIMITED – ASX EVN, NORTHERN STAR RESOURCES LIMITED – ASX NST, BARRICK GOLD CORPORATION, RANDGOLD RESOURCES LIMITED, RBC CAPITAL MARKETS

Iron ore could surge upon China’s return

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Original article by Timothy Moore
The Australian Financial Review – Page: 21 : 11-Feb-19

March iron ore futures closed 3.1 per cent higher at $US92 a tonne in Singapore on 8 February. Capital Economics says the spot price of iron ore could rally on 11 February, when Chinese traders return to the market following the Lunar New Year break. The tailings dam disaster in Brazil in late January may also impact on the iron ore price. Shares in BHP, Rio Tinto and Fortescue Metals Group have rallied in the wake of the disaster, although Vale’s share price has slumped.

CORPORATES
CAPITAL ECONOMICS LIMITED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, TD SECURITIES, OXFORD ECONOMICS LIMITED, MACQUARIE WEALTH MANAGEMENT, ARCELOR MITTAL SA, CITIGROUP INCORPORATED, FASTMARKETS MB

Rio debt upgrade as iron ore rises

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Original article by James Thomson
The Australian Financial Review – Page: 22 : 8-Feb-19

Moody’s Investors Service has upgraded its rating on Rio Tinto’s debt from A3 to A2. The credit ratings agency has noted that Rio Tinto is better-placed to ride out periods of increased volatility in commodity prices as a result of its debt reduction strategy. The resources giant has slashed its debt from US28.5bn in 2013 to just $US12.5bn. Meanwhile, the iron ore price has risen to almost $US90 per tonne in the wake of the latest tailings dam disaster in Brazil, and some analysts say it could test $US100.

CORPORATES
RIO TINTO LIMITED – ASX RIO, MOODY’S INVESTORS SERVICE INCORPORATED, VALE SA

Brazilian closures test iron restraint

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Original article by Paul Garvey
The Australian – Page: 27 : 7-Feb-19

UBS analysts are among those to have forecast an iron ore surplus in 2019. However, this is in doubt after a Brazilian court ordered Vale to put production at its Brucutu iron ore mine on hold in the wake of the tailings dam disaster at its Feijao mine. Vale has responded by declaring force majeure over its iron ore shipments. Vivek Dhar of the Commonwealth Bank says the iron ore price could potentially rise above $US100 per tonne following the production halt at Brucutu, whose annual output is 30 million tonnes.

CORPORATES
VALE SA, UBS HOLDINGS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO