MINING CORPORATIONS – AUSTRALIA

Rio splashes cash with $19bn payday

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Original article by Paul Garvey
The Australian – Page: 17 & 20 : 28-Feb-19

Rio Tinto has posted a 2018 underlying net profit of $US8.8bn, which is two per cent higher than previously, while net earnings rose by 56 per cent to $US13.6bn. The full-year result was bolstered by the proceeds of asset sales and an increase in copper production. Rio Tinto shareholders will receive a full-year return of $US13.5bn, which includes share buybacks, a final dividend of $US1.80 per share and a special dividend of $US2.43. Meanwhile, CEO Jean-Sebastien Jacques notes that there are signs of a slowdown in global economic growth.

CORPORATES
RIO TINTO LIMITED – ASX RIO, SHAW AND PARTNERS LIMITED, BARCLAYS BANK PLC

Yancoal delivers thumping profit

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Original article by Paul Garvey
The Australian – Page: 19 & 22 : 27-Feb-19

Yancoal Australia has posted a 2018 net profit of $852m, compared with $229m previously, while factors such as rising coal prices lifted operating EBIT to $2.18bn. CEO Reinhold Schmidt notes that Yancoal has reduced its dependence on exports to China after increasing its export volumes to other countries in Asia. He has also rejected suggestions that China’s recent coal import restriction were prompted by trade tensions with Australia. Yancoal shareholders will receive a final dividend of $0.126 per share, and a full-year payout of $0.2855.

CORPORATES
YANCOAL AUSTRALIA LIMITED – ASX YAL, COAL AND ALLIED INDUSTRIES LIMITED, RIO TINTO LIMITED – ASX RIO, GLENCORE PLC, ADANI MINING PTY LTD

Franking fantastic: Forrest’s $327m payday

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Original article by Brad Thompson
The Australian Financial Review – Page: 15 & 18 : 21-Feb-19

Fortescue Metals Group has posted a 2018-19 interim net profit of $US644m ($900m), which is five per cent lower than previously. Fortescue has reported revenue of $US3.54bn for the half-year, and the pure-play iron ore miner has maintained its guidance for shipments of 165 tonnes to 173 million tonnes for the full year. Shareholders will receive an interim dividend of $0.19 per share and a special dividend of $0.11. Fortescue’s founder and chairman Andrew Forrest will receive a total of $327m in dividend payouts, from a total payout of $924m.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, AUSTRALIAN LABOR PARTY, SHAW AND PARTNERS LIMITED, RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, VALE SA, INTERNATIONAL COUNCIL ON MINING AND METALS

BHP shares rise on dividend optimism

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Original article by Paul Garvey
The Australian – Page: 21 : 21-Feb-19

Investors have welcomed BHP’s latest interim financial results, with its share price closing at a long-term high of $37.94 on 20 February. The stock has gained 35.5 per cent in the last year and is now trading at or above the share price targets of seven out of the 12 analysts who are tracked by Bloomberg. BHP has flagged a strong rise in full-year profit if commodity prices remain at current levels, while it announced an interim dividend of $US0.55 per share.

CORPORATES
BHP GROUP LIMITED – ASX BHP, BLOOMBERG LP, CREDIT SUISSE (AUSTRALIA) LIMITED, UBS HOLDINGS PTY LTD

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

South32 warns of strike risk if ALP wins poll

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Original article by Brad Thompson
The Australian Financial Review – Page: 13 & 18 : 18-Feb-19

South32 CEO Graham Kerr is concerned that Labor’s workplace reform agenda could lead to increased industrial action, particularly in the resources sector. He says the outcome of the upcoming federal election could affect business confidence for at least 12 months. Kerr notes that stability of supply is a major priority for buyers of Australia’s metallurgical coal buyers. He adds that if supply is disrupted they will source coal elsewhere, and it is very hard to regain a customer’s trust once it has been lost. Employers’ groups are also concerned about any move to reinstate industry-wide bargaining.

CORPORATES
SOUTH32 LIMITED – ASX S32, AUSTRALIAN LABOR PARTY, THE AUSTRALIAN INDUSTRY GROUP, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY, AUSTRALIA. REGISTERED ORGANISATIONS COMMISSION, CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION OF AUSTRALIA, TAHMOOR COAL PTY LTD, CENTENNIAL COAL COMPANY LIMITED, WOLLONGONG COAL LIMITED – ASX WLC, PEABODY ENERGY AUSTRALIA COAL PTY LTD, PORT KEMBLA COAL TERMINAL LIMITED

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