bhp eyes 13b record profit

BHP eyes $13bn record profit - By Robin Bromby
August 21, 2006 12:00am
Source: news.com.au

SO high are expectations, that anything less than $US10 billion ($13 billion) in profit - and a new Australian record - will be a blow when BHP Billiton's 2006 result is released on Wednesday.

BHP (bhp.ASX:Quote,News) achieved new highs in its aluminium, copper, iron ore, nickel and natural gas businesses during the June quarter.

Adding to the bottom line will be the contribution from its WMC Resources acquisition.

ABN AMRO, in a note to clients which described BHP Billiton (bhp.ASX:Quote,News) as a "money machine", said it expected the company to announce another capital management plan, which might amount to as much as $US3 billion.

Analysts have estimated the bottom line for the 12 months to June 30 will come in at $US10.2-10.5 billion, eclipsing 2005's robust $US6.5 billion - itself an Australian profit record.

This week will also give investors a better gauge of how the booming commodity prices are working their way through to profits and dividends.

Oil Search's first-half results are out tomorrow with strong oil receipts offset by the sale earlier this year of 10 per cent of its operations to AGL.

On Wednesday, Jubilee Mines should deliver another good year's result on the back of high nickel prices. And on Thursday, lead and zinc miner Zinifex and mineral sands giant Iluka will report their annual and half-year results respectively.

Analysts following BHP have been encouraged not just by a strong fiscal 2006 overall, but a stellar June quarter.

Financial advisers Fat Prophets said the standout operation during the June quarter was iron ore with output of 26 million tonnes - 16 per cent higher than the preceding quarter's.

Natural gas output in the quarter was also a record at 99 billion cubic feet, up 27 per cent.

With AAP