BHP's H1 Underlying Profit Up 25% on Year (Correction)
(Corrects currency to US$)
Australian oil and gas producer BHP Billiton February 20 reported a 25% rise in underlying profit for 2H 2017 thanks to higher commodity prices.
Underlying profit for H1 was $4.06bn compared with $3.24bn in the same the same period of last year. Profit after tax was $2.01bn, down from $3.20bn, owing to a charge arising from a change in US corporate taxes. Revenue for H1 increased 16% to $21.78bn.
The average natural gas price was $3.54/mn ft3 ($3.61/mn Btu), compared with $3.21/mn ft³ in 2H 2016.
Commenting on the commodity outlook, BHP stated that the US domestic gas price was relatively stable as growth in exports, strong power demand over summer and delays to North East pipeline projects helped eliminate the storage surplus relative to the five-year average. “We anticipate that the market will return to surplus in the 2018 calendar year, as record US production is facilitated by the start-up of major North East pipelines,” it said.
US shale assets sale by June
BHP said it continues to progress a number of alternatives to exit its onshore US shale assets. It has started to market each of the fields and the data room for the Fayetteville field has been opened.
“We continue preparing all appropriate documentation ahead of data rooms for the remaining fields being opened in March 2018. We expect to receive trade sale bids during the June 2018 quarter, evaluate and negotiate those bids in the September 2018 quarter and potentially announce completed transactions in the first half of the 2019 financial year. In parallel, we continue to explore potential asset swap opportunities and exit via demerger or initial public offering,” the company said.