KEY POINTS:
BHP Billiton
BHP Billiton is set to break its own Australian profit record by posting a June-year result of more than US$13.5 billion ($17 billion). The result was computed by Australian analysts who closely follow the company's performance, which itself stems directly from prevailing prices of commodities and volume of production. The latest profit will be 30 per cent up on last year's US$10.45 billion and 63 per cent higher than 2005. That was the year that the China-fuelled commodity boom really took off. It is not plain sailing for BHP. Soaring commodity prices tend to hide the persistent problems that a global miner like BHP encounters. Cost pressures on new projects are a persistent problem. For example, BHP reported its 50 per cent share of development costs for the Stybarrow oil project offshore in WA had risen from US$300 million to US$380 million.
Comvita
Comvita warns of an impending loss of $1.2 million in half-year earnings to June 30. The company has continued to invest in the people, infrastructure, research and development required for its honey-based products. The first-half sales were off target as it had to deal with the twin impacts of a record high dollar and significantly tightened regulatory standards for most of its products in the export markets. Meanwhile, a patented advanced wound care dressing by Comvita has become the first honey-based product for the management of wounds and burns to receive marketing clearance from the US Food and Drug Administration (FDA). The market seems to have taken notice of its success in getting FDA approval as the shares are recovering from the initial shock of a loss forecast. Although a small company by world standards operating in an obscure niche, Comvita has some potential.
* Views expressed in this article are those of IRG, not the Weekend Herald.
