Bloomberg News

BHP Among Miners Poised for 2012 Profit Drop, Deutsche Bank Says

January 09, 2012

Jan. 9 (Bloomberg) -- BHP Billiton Ltd., the biggest mine operator, is among companies in the industry whose earnings will probably fall this year on lower prices for commodities from copper to coal, according to Deutsche Bank AG.

“Global growth has been lower than we expected six months ago,” Deutsche Bank analysts Robert Clifford, Grant Spore and Gaetan De Buyer wrote in a report today. “We now see 2012 as a year of declining earnings for the miners,” they wrote in the note, cutting earnings estimates by an average 40 percent.

BHP may report earnings of $3.73 a share, down 8 percent from a year earlier, Deutsche Bank said, cutting its prior forecast of a 10 percent gain.

Anglo, the largest platinum and diamond producer, may post earnings of $4.79 a share, down 28 percent from the bank’s prior estimate for 2012, the analysts wrote. In addition, Aquarius Platinum Ltd. may swing to a loss of 8 cents a share from the bank’s previous forecast for 2012 of a 10 cent profit.

Deutsche Bank has cut its 2012 copper forecast 19 percent and outlook for coal burned in power plants by 5.4 percent.

Commodity prices have fallen 17 percent from a May peak in the past 12 months, based on the Thomson Reuters/Jefferies CRB commodity futures price index. Credit Suisse said Jan. 6 miners will have “muted earnings and cash flow.” Commodities are set for a “difficult environment” in 2012, UBS AG said Nov. 30.

--Editor: Tony Barrett, Ana Monteiro

To contact the reporter on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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