BHP (BHP) is trading at its highest level since January, as investors ready for an iron ore-charged set of 2020 financial year results. The steelmaking ingredient is over $110 (£84) per tonne (t) on Chinese demand and supply issues. Fellow iron ore giant Rio Tinto (RIO) paid out a higher interim dividend last month although stopped short of the special pay-out given last year.
The ‘Big Australian’ produced 248mt of iron ore in the 12 months to 30 June, a 4 per cent increase on 2019. It has flagged $100m-$150m in Covid-19 costs for the period, but FactSet consensus for earnings per share is an 8 per cent increase on 2019. Consensus also sees a 3 per cent drop in cash profits, to $22.3bn.
Investors should be happy overall, however, with the company overcoming poor oil prices and flagging its net debt would be at the lower end of the $12bn-$17bn target range. New chief executive Mike Henry has had just about the most dramatic introduction to the job possible.
