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Market Update

BHP Billiton Cost Focus Lifts Net, Australian Rate Outlook Stable


Author: Marcus Jacob
ticker.com
Last Update: 8:41 AM ET February 18 2014

5:00 PM Sydney – Reserve Bank of Australia indicated in the latest statement that interest rate may remain stable in the near term and the Aussie dollar traded above 90 U.S. cents. BHP Billiton first-half revenues increased 5.6% and net surged 83% on cost cutting and shelving capital spending.

Australian stocks extended gains after BHP Billiton reported bumper profit despite the recent weakness in commodities prices.

Investors also factor the latest release of minutes of meeting from the Reserve Bank of Australia. The statement indicated local interest rate may remain stable in the near term.

After the release of the statement, indexes remained stable and the dollar traded above 90 U.S. cents.

Australian dollar closed at 90.39 U.S. cents and in stock market trading turnover rose to 707 million shares worth $4.4 billion.

The ASX 200 index rose 9.90 to 5,392.80 and the broader All Ordinaries gained 7.40 to 5,402.20.

Stocks in Review

Rio Tinto climbed $1.34 to $70.88.

BHP jumped 87 cents to $38.89 after the mining company reported revenue in the first-half ending in December climbed 5.6% to $32.2 billion from $30.5 billion a year ago.

Net profit in the period surged 83.1% to $8.11 billion from $4.43 billion and diluted earnings per share jumped to $1.52 from 83 cents a year earlier.

The miner reduced its net debt to $27.1 billion from $29.1 billion at June 30 and narrowed operating costs by $4.9 billion in last 18 months. The miner earned $6.50 billion from its iron-ore division, an increase of 60%.

“There may be few ups and down in the next quarter or two perhaps little bit of a recovery in the demand but still we see some issues arising from new supply,” said Chief Executive Officer Andrew Mackenzie.

Woodside Petroleum Limited fell 8 cents to $38.50.

Westpac slid 5 cents to $32.86.

Coca-Cola Amatil Ltd plunged 5.3% to $11.22 after the beverage bottler said revenue in the year fell 1.2% to $5.08 billion from $5.14 billion a year ago period.

Profit in the year tumbled 82.5% to $79.9 million compared to $457.8 million a year earlier.

The company wrote off $317 million and impairments of $87.3 million in inventory at its packaged foods unit resulting in record low profit in last 20 years.

Seven West Media Ltd dropped 1.8% to $2.14 after the diversified media group reported revenue for the first-half ending in December fell 1.2% to $966.3 million from $977.9 million a year earlier.

Net in the period swung to a profit $150.1 million compared to a loss of $109.3 million and diluted earnings per share swung to a 13.2 cents from a loss of 9.5 cents a year ago.

The company said revenues from television segment rose 2.6% to $683.7 million while revenues from newspaper plunged 11.8% to $139.4 million.

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc