BHP FY profit down 4% on virus struggle

BHP’s full-year profit has slipped four per cent and it expects its major revenue earner, iron ore, will have less demand from China and greater competition from Brazil.

The miner posted full-year net profit of $US7.95 billion ($A11.02 billion) after the coronavirus pandemic challenged supply and demand.

Shareholders will receive a final dividend of 55 US cents per share, fully franked, lower from the 2019 final dividend of 78 US cents per share, fully franked.

In its commodities outlook, BHP said its main source of uncertainty was the risk of COVID-19 outbreaks in key markets.

Management expect Chinese demand for iron ore to fall in the remainder of 2020 as crude steel production plateaus.

It also expects iron supply from Brazil to improve as the industry there regroups from the collapse of the Brumadinho iron ore tailings dam.

New supply of iron ore from West Africa was also likely, the miner said.

BHP collected $US20.7 billion in revenue from iron ore over the 12 months to June 30, higher from $US17.2 billion in the previous period.

Its next biggest revenue earner was copper, which earned $US10.6 billion.

Shares were trading lower by 0.3 per cent to $39.74 at 1147 AEST.

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