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BHP Billiton: Full year production
Miner BHP Billiton has reported increases in production of oil and gas as well as most metals. Total production of petroleum products (21% of operating profits) declined by 3% to 119 mboe in in the year to June 2005. Production for the fourth quarter of the year was up 9% over the comparative period.
Oil condensate production was 5% higher as a result of new production. Natural gas production rose even higher due to commissioning of a new LNG well and equipment in Australia. The production of alumina for the full year as well for the last quarter has remained unchanged. Aluminium production has risen 6% for the year due to first full year production at new sites in Mozambique and South Africa, but has declined 4% during the Q4 of the financial year.
Base metals (Copper, Lead and Zinc) generated 25% of the operating profit in the first half, with copper driving operating profit in the first half. The production off all the above stated base metals for the financial year and Q4 were higher than or at least in line with the comparative period.
Carbon steel materials (Iron ore, coal, manganese ore and alloys) contributed 24% of the operating profit in the first half of 2004/05 financial year. Virtually all the above mentioned materils production was up for the financial year as well as for the last quarter against the comparative periods.
BHP Billiton’s share (806p) trades at a prospective PE of 15× and has a 1.9% yield. The acquisition of Australian miner WMC Resources (now has over 90% shareholding) for US$ 7.3bn will increases BHP Billiton’s exposure to nickel and copper and thus will be poised to benefit further from rising nickel and copper prices in the world markets.
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