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Australia's Fortescue Posts 40% Fall in H1 Net Profit

Fortescue Metals is Australia’s third largest miner of iron ore with a market cap of $21.2 billion.
Photo: Fortescue Metals
Fortescue Metals is Australia’s third largest miner of iron ore with a market cap of $21.2 billion.

Australia's Fortescue Metals Group, the world's No. 4 iron ore producer, reported a 40 percent fall in first-half profit as the price of the steel-making ingredient fell sharply and costs rose as it ramped up production to feed Chinese steel mills.

Fortescue, which ranks behind Rio Tinto, Vale and BHP Billiton, posted a net profit of $478 million for the six months ended December.

(Read More: BHP Names New CEO as Profit Slumps)

That compared with $801 million a year ago and an average forecast from analysts of around $466 million, although their projections had ranged widely.

Fortescue Chief Executive Nev Power said a record operational result of a 32 percent rise in shipments to 35.7 tons for the half-year had partly offset price volatility.

(Read More: Rio Tinto Posts Annual Loss; New CEO Vows to Cut Costs)

Shares in the company were down 1.8 percent at A$5.09 at 0140 GMT.

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