BHP Billiton Limited’s (ASX:BHP) share price has risen by 80 cents or 2.66% to $30.87 after the mining giant announced it has trimmed its full-year iron ore production guidance after being forced into unexpected dumper car maintenance.
The company now expects to produce between 272 million tonnes and 274 million tonnes for the 2018 financial year, compared to previous guidance of between 275 million and 280 million tonnes.
Third-quarter iron ore production was 57.7 million tonnes – up 8% on the prior corresponding period – bringing the total for the nine months to March to a record 175 million tonnes.
But third-quarter production slipped 6% from the previous quarter because of the unreliable dumper cars needing maintenance to improve availability and performance.
That remedial work on the dumper cars should help the company increase annual production at its Port Hedland operations to the 290 million tonnes for which it already has regulatory approval.
Third-quarter copper production doubled from the prior corresponding period, and increased 6% from the December quarter, thanks to the start up of the Los Colorados Extension project in September.
RBC Capital Markets analyst Paul Hissey said he rated BHP at fair value, on par with rival Rio Tinto Limited (ASX:RIO).
“The 2018 March quarterly result was softer than our estimates across the board, with the exception of the copper group,” he said.
The BHP Billiton Limited share price has fallen 2.31% in the last 3 months, while the S&P/ASX 200 Index has fallen roughly 2.18%. The BHP Billiton Limited share price has gained 29.26% in the last 12 months.
with Stuart Condie, AAP