Fortescue posts record profit and pays out bumper dividend

Fortescue Metals Group (FMG) made a record $3.19 billion in profit in the 12 months to end June, enabling it to pay out a bumper dividend of AUS$1.14.

Surging iron ore prices over the last year helped the Australian iron ore miner more than double its net profit after tax, a slight beat on consensus.

“This was a strong set of results for FMG, in line with our estimates,” said broker RBC Capital in a report. The final dividend was stronger than we had expected.”

FMG’s chief executive Elizabeth Gaines said the company had enjoyed a strong start to the 2020 financial year and was still seeing solid demand growth despite trade tensions between China and the United States.

“What underpins our confidence in the outlook is that we have seen China’s steel production up 9% in the first seven months of the year and we are still seeing strong demand for our products,” she told journalists on a results call.

“We are certainly seeing the investment in infrastructure continue to underpin that strength in demand,” she added.