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Slump in global commodity prices blamed for soft BHP profits

Xinhua, August 25, 2015 Adjust font size:

The sharp drop in global commodity prices have seen BHP Billiton's annual profit sliced in half, forcing the mining giant to cut its spending in response.

Underlying profit in the year to June 30 dropped 52 percent to 6.4 billion U.S. dollars, slightly weaker than market expectations of 6.6 billion U.S. dollars, the miner announced on Tuesday.

Falling iron ore, copper, coal and petroleum prices wiped 16.4 billion U.S. dollars from its underlying earnings, with the price of iron ore the main culprit, down 41 percent from the year prior.

BHP said it can decrease investment and stretch the capacity of its existing operations to increase volumes at low cost, aiming to reduce capital expenditure in the next two financial years by five billion U.S. dollars. Endi