Fortescue Metals Group (FMG) on August 26 said its annual profit nearly tripled and declared a bumper dividend, helped by robust output and soaring iron ore prices amid a supply crunch.
Fortescue's result comes amid a windfall for iron ore miners earlier in the year after supply disruptions and robust demand from China sent prices soaring. The miner's shares have nearly doubled so far this year.
The world's fourth-largest iron ore miner posted a final dividend of A$0.24 per share ($0.16 per share), double what it paid last year, bringing its total dividend to A$1.14.
The price Fortescue received for its ore in the June quarter jumped 30% from the previous quarter to $92 per dry tonne, narrowing its discount to benchmark 62% iron ore to 13% from as wide as 37% a year ago, the miner said last month.
Fortescue reported a full-year underlying net profit after tax of $3.19 billion, slightly below a forecast of $3.21 billion from Credit Suisse. Last year it reported a profit of $1.08 billion.
"We have seen a strong start to FY20 and Fortescue is well positioned to continue to deliver benefits to all stakeholders," Chief Executive Officer Elizabeth Gaines said in a statement.
The miner last month forecast stronger iron ore shipments in 2020, but also flagged higher costs as it ramps up production to meet demand from China, its largest market.
The result comes as global supply is normalizing, sparking a steep fall in iron ore prices this month. Global economic headwinds from the Sino-U.S. trade war have also raised fears that demand could slow.
(Writing by Becky Du Editing by Harry Huo)
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