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Fortescue Metals Group flags mega profit from sky-high iron ore prices

Stuart McKinnonThe West Australian
Fri, 22 January 2021 9:01AM
Stuart McKinnon


An iron ore shiploader at Fortescue Metals Group’s Herb Elliott facility at Port Hedland. Credit: Photography Project

Fortescue Metals Group has revealed it expects to deliver a record first-half profit of $US4 billion to $US4.1b ($5.2b to $5.3b) next month, slightly above market expectations.
The figure is up more than 500 per cent on the $US644 million net profit the company delivered in the previous corresponding period.

The expected profit for the six months to the end of December could deliver shareholders an interim dividend of as much as $1.10 per share based on a payout ratio of about 65 per cent.

The iron ore miner revealed the unaudited profit expectation this morning as part of an announcement to the ASX which documented a speech delivered by the company’s chairman and founder Andrew Forrest as part of the ABC’s Boyer Lecture series.

In his speech, Mr Forrest revealed that Fortescue had achieved a net profit of more than $US940m in the month of December alone, as iron ore prices soared to nine-year highs and the company sprinted to ship as much ore as it could before the end of the year and the looming cyclone season.


Analysts expect Fortescue to deliver an after-tax profit of $9.5b in full-year 2021, which means its first half earnings are tracking slightly ahead of expectations.

However, the company’s full-year profits are still subject to another five months of unknown price, market and operational uncertainty.

Fortescue will unveil its December quarter operating results next Thursday, with its first-half profit results expected on February 18.

Fortescue shares were off 12¢ to $24.75 at 8.25am.