MELBOURNE (Reuters) - BHP Billiton
The world's biggest mining company said with cost cuts and a reduction in net debt it expects to generate more than $7 billion in free cash flow in the year to June 2017, at current prices for iron ore, copper, coal, oil and gas.
"While commodity prices are expected to remain low and volatile in the short to medium term, we are confident in the long-term outlook for our commodities, particularly oil and copper," Chief Executive Andrew Mackenzie said in a statement.
Excluding $7.7 billion in writedowns and charges, underlying profit still slumped 81 percent to $1.2 billion for the year to June 2016 from $6.4 billion a year ago, hit by weak prices for its major commodities.
The underlying profit was the weakest since the merger of BHP and Billiton in 2001, but better than analysts' expectations of around $1.1 billion.
Shoring itself up against tough markets, BHP, like rival Rio Tinto
It announced a full-year dividend of 30 cents, which it said was more than the minimum under its new payout policy, although it was just below analysts' forecasts around 32 cents.
Net debt rose slightly from December to $26.1 billion, which was higher than the $25 billion that analysts had expected, but BHP said it expects net debt to fall in the 2017 financial year.
"We continue to pursue capital-efficient latent capacity opportunities which will support volume growth of up to four per cent next year, excluding our onshore U.S. assets where we continue to defer activity to maximise value," Mackenzie said, referring to its shale oil and gas business.
(Reporting by Sonali Paul; Editing by Richard Pullin)
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