Mining giant BHP Billiton, bidding for rival Rio Tinto in what would be the world's second-biggest takeover, posted a 30 percent rise in half-year profit on Monday, boosted by Chinese demand.
The world's biggest miner said cost controls and its emphasis on high-margin growth projects had propelled its bottom line to a record profit of $15.4 billion for the full year to June 30, but also warned of weaker global economic growth in the short term.
"Our results were outstanding in the context of a challenging supply environment, which was characterised by unexpected disruptions, rising input prices, skills shortages and the further devaluation of the U.S. dollar," the firm said.
BHP said higher operating costs, such as fuel, staff and equipment replacement, had inflated costs across the group by $1.18 billion for the year.
"Strong global demand for resources continues to provide cost challenges for the whole industry.
This is mainly due to rising prices for inputs such as diesel, (steel-making) coke and explosives, and shortages of skilled labour," it said.
Cost inflation has emerged as an achilles heel for miners reaping big profits from global demand for minerals such as copper and iron ore.
