MINING CORPORATIONS – AUSTRALIA

BHP frees cash for shareholders

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Original article by Matt Chambers
The Australian – Page: 19 & 23 : 22-Aug-18

BHP Billiton has posted a 2017-18 underlying profit of $US8.93bn, which is 33 per cent higher than previously. The resources giant boasted free cash flow of $US12.5bn for the financial year, and it expects to return about $US20bn to shareholders in 2018-19, including the proceeds from the recent sale of its shale assets in the US. Shareholders will receive a full-year dividend of $US1.18 per share for 2017-18, including a record final dividend of $US0.63.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, PENDAL GROUP LIMITED – ASX PDL, RIO TINTO LIMITED – ASX RIO

Fortescue delivers payday to Forrest

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Original article by Matt Chambers
The Australian – Page: 20 : 21-Aug-18

Fortescue Metals Group chairman and founder Andrew Forrest will be paid a total of $239m in dividend payments for the 2017-18 financial year. Forrest has received total franked dividend payments of $1.3bn before tax since 2011, with the bulk of these dividends being invested in his philanthropic organisation, the Minderoo Foundation. His 33.36 per cent stake in Fortescue is worth $4.33bn, based on the stock’s closing price of $4.26 on 20 August.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, MINDEROO FOUNDATION, AUSTRALIAN INDUSTRIAL ENERGY, SQUADRON ENERGY, HOEGH LNG

Fortescue chair Forrest’s dividend hit

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Original article by Peter Ker
The Australian Financial Review – Page: 18 : 20-Aug-18

Fortescue Metals Group posted a net profit of $US2.09bn in 2016-17, but the consensus of analysts is that its profit for 2017-18 will be around 49 per cent lower. JPMorgan is more bearish, forecasting that Fortescue’s net profit could fall by up to 59 per cent to just $US856m. The firm expects Fortescue to announce a full-year dividend of $0.20 per share, following an interim dividend of $0.11. Company founder and chairman Andrew Forrest received $467m worth of dividend payments in 2016-17, but this could fall to just $207.7m in 2017-18 based on JPMorgan’s numbers.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, JP MORGAN AUSTRALIA LIMITED, GLENCORE PLC, WHITEHAVEN COAL LIMITED – ASX WHC, MINERAL RESOURCES LIMITED – ASX MIN, EVOLUTION MINING LIMITED – ASX EVN, NORTHERN STAR RESOURCES LIMITED – ASX NST, HANCOCK PROSPECTING PTY LTD

BHP royalties to soften cost spike for Iluka

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Original article by Brad Thompson
The Australian Financial Review – Page: 28 : 17-Aug-18

Iluka Resources has posted a 2018 interim net profit of $126m and EBITDA of $279m. The mineral sands producer has advised that the cost of expanding its rutile assets in Sierra Leone could be 40-60 per cent higher than forecast, with the Sembehun deposit accounting for the bulk of the expected cost overrun. Operating costs at the Sierra Rutile assets are also forecast to exceed previous guidance. Iluka also receives royalty payments from BHP Billiton’s Mining Area C iron ore operations.

CORPORATES
ILUKA RESOURCES LIMITED – ASX ILU, SIERRA RUTILE LIMITED, BHP BILLITON LIMITED – ASX BHP

Former Rio mines a boon for Yancoal

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Original article by Peter Ker
The Australian Financial Review – Page: 19 : 17-Aug-18

Yancoal Australia has reported a 2018 interim net profit of $361m. The result was boosted by the contribution of Rio Tinto’s thermal coal mines in New South Wales and a sharp rise in the price of thermal coal since the deal was struck. About $130m of the interim profit will be returned to shareholders via dividend payments, which equates to about $0.003 per share.

CORPORATES
YANCOAL AUSTRALIA LIMITED – ASX YAL, RIO TINTO LIMITED – ASX RIO, WHITEHAVEN COAL LIMITED – ASX WHC

Restart at Koolan has Mt Gibson in sweet spot

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Original article by Peter Ker
The Australian Financial Review – Page: 20 : 16-Aug-18

Mount Gibson Iron has reported a 2017-18 net profit of $99.1m, with insurance proceeds arising from a seawall collapse at the Koolan Island mine contributing $64m to the result. The mine is expected to resume shipments within six months, more than four years after the incident put production on hold. Mount Gibson will benefit from a strong rise in the premium for higher-grade iron ore in the intervening years; ore with 65.5 per cent iron content such as that produced at Koolan Island is now fetching a premium of around 30 per cent to the benchmark price, compared with 3-5 per cent at the time of the collapse.

CORPORATES
MOUNT GIBSON IRON LIMITED – ASX MGX, VALE SA, KUMBA RESOURCES LIMITED, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, UBS HOLDINGS PTY LTD

Union fury as BHP sends South Flank steel work offshore

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Original article by Sean Smith
The West Australian – Page: Online : 15-Aug-18

BHP Billiton has attracted criticism for awarding a steel contract associated with its South Flank iron ore project in the Pilbara to China’s Tianjin BOMESC Offshore Engineering Company. BHP has indicated that it was necessary to give the steel fabrication contract to an offshore company to ensure that the work is completed on time. Steve McCartney, the state secretary of the Australian Manufacturing Workers’ Union, says local steel fabricators should have been given the contract, adding that Premier Mark McGowan should intervene.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, TIANJIN BOMESC OFFSHORE ENGINEERING COMPANY LIMITED, AUSTRALIAN MANUFACTURING WORKERS’ UNION, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET

Lawyers sniff a settlement out of BHP

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Original article by Peter Ker
The Australian Financial Review – Page: 22 : 10-Aug-18

BHP Billiton has agreed to settle a class action launched by US shareholders over losses arising from the Samarco iron ore tailings dam collapse in Brazil. BHP has offered to pay $US50m ($67.2m) in compensation to settle the case, although it will not admit any liability for the disaster. Brett Spiegel of Australian law firm Phi Finney McDonald says its class action is based on similar underlying issues, adding that the US settlement has vindicated his firm’s contention that BHP had misled investors and failed to comply with disclosure requirements.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, SAMARCO MINERACAO SA, PHI FINNEY McDONALD PTY LTD, FEDERAL COURT OF AUSTRALIA, MAURICE BLACKBURN PTY LTD, HERBERT SMITH FREEHILLS PTY LTD

Fortescue out of kilter on discounts

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Original article by Matthew Stevens
The Australian Financial Review – Page: 30 : 9-Aug-18

Fortescue Metals Group CEO Elizabeth Gaines maintains that the price discount for lower-grade iron ore is cyclical rather than structural. The general consensus among iron ore producers is that the price gap will be sustained, with executives from Rio Tinto and Vale recently expressing the view that Chinese steel mills will continue to favour higher-grade ore. The benchmark price of iron ore rose by almost three per cent on 7 August, to almost $US70 per tonne.

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

FMG sees end in sight to discounting

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Original article by Brad Thompson
The Australian Financial Review – Page: 18 : 8-Aug-18

Fortescue Metals Group CEO Elizabeth Gaines has told the Diggers & Dealers forum in Kalgoorlie that the pure-play iron ore miner still considers the price discount for lower-grade ore to be cyclical. She said the price gap will eventually narrow, although it is too soon to know when this will occur. Gaines also said Fortescue could seek a seat on Atlas Iron’s board after choosing to retain a stake in the takeover target. She added that Fortescue expects to participate in the consultation process regarding the development of new South West Creek berths at Port Hedland.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, ATLAS IRON LIMITED – ASX AGO, DIGGERS AND DEALERS FORUM, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, MINERAL RESOURCES LIMITED – ASX MIN, ROY HILL HOLDINGS PTY LTD