Newspaper article The Evening Standard (London, England)

BHP Digs Deep with Even More Cost Cuts as Iron Ore Price Falls

Newspaper article The Evening Standard (London, England)

BHP Digs Deep with Even More Cost Cuts as Iron Ore Price Falls

Article excerpt

Byline: Jim Armitage

BHP Billiton today stepped up its efforts to deal with a plunging iron ore price by declaring it would push through an extra $500million (PS312million) a year of productivity improvements in the next two years.

The world's biggest mining company issued its new cost-cutting plan amid a reshuffle of operations management ahead of its plan to split off its smaller businesses like aluminium into a separate, standalone company.

Taking the knife even deeper into its capital expenditure programme would safeguard the company's dividend at a time of plummeting commodities prices, chief executive Andrew Mackenzie said.

"We will strike the right balance between investment in high-return opportunities and returning cash to shareholders," said Mackenzie.

It was only in October that he announced a target of improving productivity by at least $3.5 billion a year by 2017 thanks in part to the demerger, but now he is aiming at $4 billion. …

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