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Global mining giant BHP Billiton today said its first-half net profit almost halved to $4.26 billion on the back of collapsing commodity prices as it reiterated a plan to demerge non-core assets.
The 47.4% slump in the six months to December 31 compared to $8.1 billion in the previous corresponding period, with revenues dropping 11.9% to $29.9 billion.
Underlying earnings which exclude one-off writedowns were down 31% to $5.35 billion, slightly better than analyst expectations.
The world's biggest miner has been hard hit by falling prices for its two main commodities, iron ore and oil, with a 23% reduction in capital and exploration expenditure helping offset some of the damage.
Despite the downbeat data, the company boosted its interim dividend by 5.1% to 62 cents with chief executive Andrew Mackenzie saying the firm had been preparing for sliding prices by reining in spending and scaling back investments in recent years.
"Despite significant falls in the prices of our main commodities over the last six months, group margins remain healthy, free cash flow has increased and we have strengthened our balance sheet," he said, adding that net debt had been reduced to $24.9 billion.
"We are confident that we can maintain our progressive dividend policy and continue to selectively invest in projects that offer compelling returns.
"We started to prepare for a sustained period of lower prices almost three years ago by increasing our focus on efficiency and lowering our investment," added Mackenzie.
"Since then, we have achieved annualised productivity gains approaching $10 billion and reduced capital spending by almost 40%."
The company said there had been stellar performances across its diversified portfolio with records achieved for eight operations, but this was partially offset by prices tumbling as demand was outpaced by a supply surge for some commodities.
Iron ore, the steel-making ingredient is BHP's most lucrative commodity and production from its key Western Australian operations jumped 15% in the half year to 124 million tonnes.
But the boost came with the economy of major customer China slowing and demand dropping due to weakness in its property sector.
Petroleum production increased 9% and metallurgical coal output jumped 21%, but copper fell by 2% and aluminium, manganese and nickel were broadly unchanged.
