BHP Billiton due to report largest loss since its inception

 
Jessica Morris
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BHP Billiton Announces Record Financial Results
BHP has also announced a $1.1bn to 1.3bn loss charge related to the Samarco dam disaster (Source: Getty)

Struggling mining giant BHP Billiton is expected to reveal a historical near $7bn (£5.4bn) loss in its full-year results next week.

Analysts have predicted that the Samarco dam disaster and a tough business environment led to the largest loss in BHP's history, which goes back to the 1850s.

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"This represents BHP Billiton's largest corporate loss since the formation of the dual listed company and we believe the largest reported loss for BHP since its inception," analysts at investment bank UBS said in a note.

The loss will be driven by a previously announced $4.9bn (£3.8bn) writedown to the value of its US onshore oil and gas assets amid tumbling crude prices. "There is also the possibility that further write-downs … are taken given the continued deterioration on the futures curve for oil,” UBS warned.

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BHP has also announced a $1.1bn to 1.3bn loss charge related to the Samarco dam disaster last year. Additionally, the firm said it would recognise direct costs of $100m.

This coincides with a $175m charge related to its business restructuring efforts, alongside an exceptional item for global taxation matters between $150-200m.

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