BHP Billiton posts record loss for the year

The company posted a loss of $6.4bn from a profit of $1.91bn the year before. Analysts at UBS had been expecting a full-year loss of $6.8bn.

Excluding $7.7bn of writedowns and charges, underlying profit was down 81% from 2015 to $1.2bn.

BHP declared a final dividend of 14 cents per share, which was 77% lower than the previous year’s 62 cents. This brought the full year dividend to 30 cents per share, which is down 76% from the year before.

Still, Hargreaves Lansdown analyst Nicholas Hyett said this is 75% ahead of what is implied by the group’s newly-adopted dividend policy of paying out 50% of underlying attributable profit.

Chief executive officer Andrew Mackenzie said: "The last 12 months have been challenging for both BHP Billiton and the resources industry. Nevertheless, our results demonstrate the resilience of our portfolio and the diverse ways in which we can create value for shareholders despite low commodity prices.

"Over the past five years we have actively reshaped our portfolio, and we are confident we have the right mix of commodities, assets and opportunities to create substantial value over time. 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."

Hyett said: “Today’s larger-than-expected dividend payment will be welcomed by investors in the short term, but with net debt stagnant, and gearing rising, the question is whether the cash could be better employed within the business.”

At 1100 BST, shares were up 3.7% to 1,081.50p.