BENGALURU: Fortescue Metals Group Ltd reported its highest ever annual profit and dividend yesterday, after the Australian iron ore miner shipped a record amount of the steelmaking material to take advantage of soaring prices.
Fortescue followed rivals BHP Group and Rio Tinto in reporting record profits and paying bumper dividends after a strong year for prices on the back of resilient demand from China, the top consumer, and supply issues in Brazil.
The world’s fourth-largest iron ore miner posted an underlying net profit of US$10.35bil (RM43.2bil), up from US$4.75bil (RM19.8bil) a year ago, just below a forecast compiled by Vuma of US$10.41bil (RM43.5bil).
Iron ore prices started to ease in late May and are likely to remain under pressure from a resurgence of output in Brazil and a tougher stand on emissions in China, although miners’ profit margins are expected to remain healthy.
“The last few months have taken some of the shine out of iron ore prices, but (iron ore) miners will still have a good rest of the year,” said David Lennox of Fat Prophets in Sydney.
“We still think there is enough infrastructure spending to come through from stimulatory programmes that should keep iron ore prices back towards US$180 to US$190 (RM752 to RM794) a tonne.”
Prices peaked above US$230 (RM961) a tonne in May before dropping to US$140 (RM585) a tonne this month.
Fortescue will pay a final dividend of A$2.11 (RM6.44) per share, up from A$1 (RM3.05) a share last year, taking its total dividend for the year to A$3.58 (RM10.93), or A$11bil (US$8bil or RM33.4bil).
That will add about US$1.8bil (RM7.52bil) to the wealth of the company’s chairman and biggest shareholder Andrew Forrest, who is Australia’s richest man with a net wealth of US$17.8bil (RM74.4bil) according to Forbes.
The miner shipped 182.2 million tonnes of iron ore in fiscal 2021, and expects as much as 185 million tonnes to go out in fiscal 2022.
The company is also investing in its green energy business, Fortescue Future Industries, on which it expects to spend up to US$600mil (RM2.50bil) in fiscal 2022. ― Reuters