MINING CORPORATIONS – AUSTRALIA

South32 eyes Anglo’s manganese

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 20 : 19-Feb-16

Australian-listed South32 has indicated that it would be interested in buying out its manganese joint venture partner, Anglo American. South32 holds a 60 per cent stake in the mining and smelting operation, and a spokesman says the group would be willing to assume full ownership at an appropriate price. Anglo American has signalled its intention to sell a significant number of assets, including coking coal mines in Queensland.

CORPORATES
SOUTH32 LIMITED – ASX S32, ANGLO AMERICAN PLC, UBS HOLDINGS PTY LTD, ROYAL BANK OF CANADA, BANK OF AMERICA CORPORATION

Newcrest dividend back on the cards

roymorgansocial Leave a comment

Original article by Barry FitzGerald
The Australian – Page: 20 : 16-Feb-16

Newcrest Mining has reported a 2015-16 interim net profit of $US63m, compared with $US180m previously. The result was marred by a sharp fall in the price of gold and copper during the half-year. Newcrest’s net debt fell by $US235m to $US2.65bn during the period. while its gearing eased from 29.3 per cent to 28.1 per cent. Newcrest has previously indicated that it may resume paying a dividend when its gearing falls to 25 per cent.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, EVOLUTION MARKETS LLC, CREDIT SUISSE (AUSTRALIA) LIMITED

Rio Tinto’s Simandou dream evaporates

roymorgansocial Leave a comment

Original article by Amanda Saunders
The Australian Financial Review – Page: 17 : 15-Feb-16

The Simandou iron ore project in Guinea has a book value of $US10bn on Rio Tinto’s accounts, although it is worth less than this given the current price of the steel input. Rio’s 2015-16 full-year results included a $US2bn writedown on the project, which is likely to cost about $US20bn ($A28bn) to develop. While Rio Tinto is scheduled to release a feasibility study on the project, some analysts do not expect Simandou to proceed for at least a decade.

CORPORATES
RIO TINTO LIMITED – ASX RIO, DEUTSCHE BANK AG, CREDIT SUISSE (AUSTRALIA) LIMITED, ARGO INVESTMENTS LIMITED – ASX ARG, STANDARD AND POOR’S CORPORATION, VALE SA, WORLD BANK, INTERNATIONAL FINANCE CORPORATION

Rio Tinto set to slash dividend as profits dive

roymorgansocial Leave a comment

Original article by Amanda Saunders
The Australian Financial Review – Page: 13 & 18 : 12-Feb-16

Rio Tinto has posted a 2015 statutory loss of $US866m, while its underlying earnings for the calendar year were 51 per cent lower at $US4.5bn. The downturn in the iron ore price resulted in a sharp fall in revenue, to $US34.8bn. Shareholders will receive a full-year dividend of $US2.15 per share, but Rio Tinto will abolish its progressive dividend policy in 2016 in favour of a payout ratio. It expects to pay a full-year dividend of around $US1.10 per share in 2016.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, ABERDEEN ASSET MANAGEMENT LIMITED, ENERGY RESOURCES OF AUSTRALIA LIMITED – ASX ERA, STANDARD AND POOR’S CORPORATION

RBC picks BHP Billiton over Rio Tinto

roymorgansocial Leave a comment

Original article by Amanda Saunders
The Australian Financial Review – Page: 30 : 11-Feb-16

Paul Hissey of RBC Capital has a share price target of $A15 on BHP Billiton, whose shares are trading at around $A15.67 at present. The analyst also has a "sector perform" rating on the resources giant, and forecasts that BHP will reduce its dividend by 75 per cent when its 2015-16 interim results are released later in February 2016. Meanwhile, Hissey has a share price target of $A37 and an "underperform" rating on Rio Tinto, whose stock is trading at $A41.53.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, RBC CAPITAL MARKETS, GLENCORE PLC

OZ Minerals reaps the reward of high grades

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 19 : 11-Feb-16

OZ Minerals has posted a 2015 net profit of $A130.2m, compared with $A48.5m for the previous calendar year. CEO Andrew Cole is upbeat about the group’s outlook for 2016, forecasting an increase in production of both gold and copper. He is confident that OZ Minerals will be able to keep paying a dividend while developing the Carrapateena copper project. Shareholders will receive a full-year dividend of $A0.20 per share.

CORPORATES
OZ MINERALS LIMITED – ASX OZL, BELL POTTER SECURITIES LIMITED, CITIGROUP PTY LTD, AUSTRALIAN FEDERAL POLICE, RENAISSANCE MINERALS LIMITED – ASX RNS

Fair Work decision exposes IR flaws: BHP

roymorgansocial Leave a comment

Original article by Elizabeth Colman
The Australian – Page: 4 : 10-Feb-16

BHP Billiton has criticised the Fair Work Commission for ruling that union officials can hold meetings with employees of the Caval Ridge mine at a dragline cabin rather than the site’s meal-break room. BHP argues that the ruling will adversely affect productivity at the Queensland mine. The dragline cabins are 2.4km from the mine’s meal-break room. The Fair Work Act was amended in 2013 to specify that union officials must hold meetings in meal-break rooms.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, AUSTRALIA. FAIR WORK COMMISSION, CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION OF AUSTRALIA, AUSTRALIA. DEPT OF EMPLOYMENT

Rio set to slash share dividend payout

roymorgansocial Leave a comment

Original article by Amanda Saunders
The Australian Financial Review – Page: 13 & 18 : 8-Feb-16

Most analysts expect Rio Tinto’s full-year dividend for 2015 to be $US2.21 per share, compared with $US2.15 previously. However, there is growing speculation that Rio will review its progressive dividend policy after the release of its full-year results on 11 February 2016. BHP Billiton is also widely tipped to abandon its progressive dividend policy, and Pengana Capital’s Tim Schroeders notes that there would be little benefit for Rio in being the only large miner to retain this policy.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, PENGANA CAPITAL LIMITED, VALE SA, GLENCORE PLC, ANGLO AMERICAN PLC, AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED – ASX AFI, STANDARD AND POOR’S CORPORATION, ALCAN INCORPORATED, UBS HOLDINGS PTY LTD, CITIGROUP PTY LTD

South32 takes $2.4bn hit, signals job cuts

roymorgansocial Leave a comment

Original article by Paul Garvey
The Australian – Page: 20 : 5-Feb-16

Shares in South32 rose by 14.2 to $A1.085 on 4 February 2016, as it flagged plans to significantly reduce costs. The BHP Billiton spin-off will scale back capital expenditure and production at its manganese mines in South Africa, which will result in the loss of 620 jobs. South32 has also indicated that it is likely to pursue job cuts in Australia, while its financial accounts will include $US1.7bn ($A2.4bn) worth of write-downs.

CORPORATES
SOUTH32 LIMITED – ASX S32, BHP BILLITON LIMITED – ASX BHP, MORGANS FINANCIAL LIMITED, CONSOLIDATED MINERALS LIMITED, QUEENSLAND NICKEL PTY LTD, GRANGE RESOURCES LIMITED – ASX GRR, MOUNT GIBSON IRON LIMITED – ASX MGX, SHAW RIVER MANGANESE LIMITED – ASX SRR

Tweak to BHP dividend won’t cut it, says S&P

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 13 : 4-Feb-16

Standard and Poor’s recently downgraded BHP Billiton’s credit rating to "A", and analyst May Zhong says a minor reduction in its dividend will not be sufficient to avert a further downgrade. Zhong has declined to specify how large the dividend reduction would need to be, but notes that other factors also contributed to the downgrade. BHP is under pressure to abandon its progressive dividend policy when its 2015-16 interim results are released on 23 February 2016.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, STANDARD AND POOR’S CORPORATION, MOODY’S INVESTORS SERVICE INCORPORATED, RIO TINTO LIMITED – ASX RIO