By Eric Onstad
LONDON (Reuters) - Chilean miner Antofagasta (L:ANTO) cancelled its final dividend on Tuesday as it posted a 58 percent fall in annual core profit, hit by a rout in the price of copper.
The miner said a statement that the board was not recommending a final dividend since the interim dividend of 3.1 cents had met its 35-percent payout target.
“We know that copper is a cyclical industry and as a result of the actions that we have taken over the past year we will be positioned to benefit from the recovery when it comes," Chief Executive Diego Hernández said.
Antofagasta has been hit along with other miners by a slide in prices and slower growth in China. Benchmark copper futures fell by 19 percent last year and touched 6-1/2-year lows in January.
The company, majority-owned by Chile's Luksic family, has also been hurt by declining ore grades, unfavourable weather and environmental protests.
Its first-half core profit from continuing operations, or earnings before interest, tax, depreciation and amortisation (EBITDA), fell to $890.7 million (625 million pounds) in 2015.
Other miners have also reduced or suspended dividends, hurt by the worst commodities downturn in a generation.
Glencore (L:GLEN) suspended its dividend last year while
BHP Billiton (AX:BHP) (L:BLT) and Rio Tinto (AX:RIO) (L:RIO) cut shareholder payouts last month.
Antofagasta said it sunk into net debt of $525.4 million at the end of last year from a net cash position of $315.4 million at the end of 2014 after it bought a 50 percent stake in Barrick Gold's (TO:ABX) Zaldívar mine.
One of the world's top 10 copper miners, Antofagasta said it was seeking to cut costs by a further $160 million this year and planned to reduce capital expenditure by $260 million.
The London-listed company said in January it would raise copper production to 710,000-740,000 tonnes in 2016, less than some analysts had expected, after slightly missing its 2015 output target.
Antofagasta shares fell by 38 percent last year, but have recovered by 15 percent in 2016.