The profits of Australian mining company OZ Minerals (ASX: OZL) have taken a hit this financial year dropping a drastic 72% at the half year point. Net profits at the copper mining company fell to $113.9 million from $405.7 million in the same period last year. The net profit for the calendar year 2010 had been recorded at $586.9 million.
The combination of rising costs, accounting changes and high value of the Australian dollar hit the company hard. The company also saw its production decline in the same period. OZ Minerals also paid $60 million in May in damages to settle two class actions that had been brought up against the company by shareholders.
Terry Burgess the managing director for the mining firm said that this half, they had been able to capitalize on a period of strong commodity prices through sound operations at Prominent Hill and their very strong cash flows of $388.3 million for the half have helped facilitate the purchase of the Carrapateena project.
OZ Minerals said that they looked forward to a better year as the prospects for both copper and gold are good. The price for both metals is soaring up to new highs and the company hopes to be able to take advantage of this. The company said that it was still in a strong financial position and it was in a growth phase. It has also declared an unfranked interim dividend of 30 cents per share which is in line with the previous year’s dividends.