BHP Billiton Share Discussion Threads

[togglebrush] 23/2/2016 05:41

Press CNBC
'
Top global miner BHP Billiton slashed its interim dividend by 75 percent, the first reduction since 1988, amid a rout in commodity markets that has sent prices of oil, iron ore, coal and other raw materials tumbling.
'
The world's biggest diversified miner reported a net loss of $5.67 billion for the first half of the 2016 financial year, its first loss in more than 16 years, and cut its interim dividend to 16 cents. Analysts had expected a dividend of 31 cents.

[creddy] 23/2/2016 01:50

At least there is a dividend to speak of unlike the other large cap mining plays.

[goldpiguk] 23/2/2016 00:58

Hi,

It will certainly be interesting to see how markets react to BHP's results. Have just watched the results presentation where the new dividend policy was announced with strong hints the company will look to acquire distressed assets as "buy rather than build is attractive" if a suitable opportunity arises.

Keeping an 'A' rated balance sheet throughout the cycle is at the heart of BHP's thinking, in what may well be a prolonged period of lower prices

The new dividend policy is a 50% minimum payout ratio of underlying attributable profit. In the current six months this would have been just 4 cents but an additional 12 cents has been added from cashflow making a 16c dividend in total.

The whole presentation is well worth watching in full together with the Q & A.
Although the dividend cut is far more savage than I expected BHP's strong balance sheet puts it in a great position to potentially pick up quality assets at the bottom of the cycle.

Goldpig

[rickmay] 22/2/2016 21:28

DIVI CUT !!!!!! TARGET £2 to £3.

[edjge2] 22/2/2016 12:19

Results tomorrow, divi etc, looks like market bullish on those?
Metals and oil on the up for now. 1200 gold bounce

Banks showing their sores this week.

[idioterna] 22/2/2016 11:03

..so according to our TA specialist 730 would provide serious resistance, of course that was on Friday, ages ago in the traders world.

[idioterna] 18/2/2016 08:49

So an agreement has been reached outside the courtroom (as anticipated here). Put simply that means another $5 on the share price in the next two months (they rarely do it all in one go in the other direction). Speculation and too much leverage will be the death of the stockmarket.

[anley] 17/2/2016 17:42

Seems good news...............

"Brazilian authorities reach agreement with BHP Billiton, Vale and their Samarco joint venture on a model for paying compensation over November's deadly dam failure, Brazil’s attorney general says.

The arrangement will allow Samarco to pay damages for specific programs rather than in one lump sum, and a final deal is expected to be signed by the end of the month".

"Discussions include the creation of a foundation to plan and execute all remediation and compensation programs,” BHP says on the status of talks.

So this allows BLT to pay from cash flow rather than a capital sum.........

[tpaulbeaumont] 17/2/2016 12:41

doesnt matter what colour graph you view it on ID, it backed away from resistance at 730, assuming it breaks above at some point then 765 and 830 are the next inflection points imvho, whenever it reverses back down itll print a lower low than 585 (although low tick was some 15p lower than cited support from memory, 560ish)

[idioterna] 17/2/2016 11:41

…Noise is also truth, and price fluctuates so it is only causally truthful.

[essentialinvestor] 17/2/2016 10:03

Price is truth, everything else just noise.

[sogoesit] 17/2/2016 10:01

Well, from a TA point of view i don't think a double bottom is merited yet (it needs a significant re-test of the lows, in my view).
There appears to be a short term uptrend which meets resistance, as said by tpaul, at 730.
From my short view I am now out at 696, for a loss on the trade. With interims next week, where imv the dividend should be cut, the market looks optimistic to me but the market counts so I now wait and see.

[idioterna] 16/2/2016 11:32

…no I meant the 6 month chart at the top of the page.

[tpaulbeaumont] 16/2/2016 09:12

lol, but doubtful ID ;)
its pulling back from natural resistance at 730 (as FT hits applicable level) so if it continues higher the next short term hurdles lie at 765 and 830




free stock charts from uk.advfn.com

[idioterna] 16/2/2016 08:21

I'm not much of a TA type, but it would appear we have both a bottom and a double-bottom retest in on the 6 month chart. Perhaps an auspicious moment in fengshui anyone?

[sirhedgealot] 13/2/2016 10:32

The bankers benevolence fund...one would like to be on the payroll.

[sogoesit] 11/2/2016 09:34

Good idea, Hooley. There's a lot of dust in the Pilbara.
And their oil&gas may generate smoke as well...:-)
(I'm still short below 600).
Good luck!

[hooley] 11/2/2016 08:46

Will BLT follow RTZ in slashing its own dividend? It's now respectable. The outlook is unknown, but better to be safe....I'll continue to hold-off until the dust settles.

[rickmay] 11/2/2016 08:33

BACK ON TRACK. £2 TO £3 it's coming folks

[loganair] 08/2/2016 10:24

BHP Billiton expected to cut dividend payouts to investors amid commodity rout - By business reporter Sue Lannin.

The world's biggest miner is under pressure to slash dividend payouts to investors when it releases its half-year results later this month, as the price of resources like iron ore and oil plummet.

Falling commodity prices, multi-billion-dollar write-downs and the mine disaster in Brazil have crunched BHP Billiton's share price and earnings.

Resources analyst, David Lennox, said BHP is expected to post a loss for the first half of the 2016 financial year.

"They will report a loss primarily on the back of the fact that they will have to write-down and the company has already flagged impairment charges against their assets," Mr Lennox told The Business.

"So we are expecting earnings to come in at zero to minus $250 million for the half year result."

BHP warned to get rid of current dividend policy:

Giuliano Sala Tenna, investment adviser at Bell Potter Securities, said BHP should get rid of the policy.

"I think it confirms what a lot of market commentators have been saying for a long time now that it's a little bit foolhardy for BHP to be blindly wedded to a progressive dividend policy when clearly the earnings are under a lot of pressure," Mr Sala Tenna told The Business.

Last year the big miner paid out $US6.6 billion in dividends. It made $US1.9 billion in net profit in 2015, down nearly 90 per cent from 2014.

Aberdeen Asset Management is BHP's second biggest investor in Australia and it believes the progressive dividend policy is unsustainable.

Aberdeen's head of Asia Pacific Credit Research, John Manning, said he expected BHP to halve interim dividend payouts from $US0.62 to $US0.31.

"What they need to do is make the future distributions more sustainable," Mr Manning said.

"That, in our mind, moves it away from a progressive toward a percentage payout ratio, something along the lines of a percentage of free cashflow."

But Matthew Haupt, portfolio manager at Wilson Asset Management, said the loss of the progressive dividend would be a blow for mum and dad investors.

"Retail investors like dividends so I think if BHP cut their progressive dividend it [will] definitely send a signal to the retail investor about the future income from this company," Mr Haupt said.

At the last November annual general meeting BHP chairman Jac Nasser refused to guarantee the progressive dividend policy as the company faced a barrage of questions from the media.

Mr Lennox thinks the miner will not cut dividends until its annual results are released in August. He said no dividend cut could mean BHP would have to rely on debt to pay dividends to investors.

"There is no doubt if they do borrow heavily or borrow more to actually pay out a current dividend rather than perhaps use money to focus on growth then you would expect the credit ratings [agencies] would look at downgrading them a little further," Mr Lennox said.

Mr Haupt thinks BHP will not cut its dividend until later in the year at the annual results, even if that means another credit ratings downgrade.

"Even if they cut the dividend by 50 per cent so they will still be pushing along the bottom end of the S&P range so there is a definite possibility the rating gets cut to A- after the result," Mr Haupt said.

Mr Manning wants to see BHP Billiton take urgent action to keep its A credit rating by cutting dividends and capital spending.

"The cards have laid on the table by the ratings agencies. Now is the time for management to step up to the table and to act," Mr Manning said.

More pain predicted for share price:

BHP Billiton's woes have seen its share price drop by half over the past year to a low of $14.06. Barclays predicts the share price could fall to $10.50.

Mr Haupt said Wilson Asset Management would be prepared to buy BHP shares if the price fell below $10.

"Under $10 you would definitely have to have a look at it because the company produces quite a bit of cash and I think the underlying assets are of acquired value," Mr Haupt said.

Mr Sala Tenna said there are more risks for BHP if the resources rout continues.

"BHP does have leverage to the energy markets so if we see a recovery in those prices that would signal a short term trough in their share price, but certainly the outlook for iron ore and copper looks fairly challenged over the next 12 months," Mr Sala Tenna said.

Despite the challenges, Mr Manning says Aberdeen Asset Management plans to keep investing in BHP Billiton.

"They are in our minds one of the strongest mining companies globally so they are very well positioned if we do go into a sustained downturn," he said.