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Investing.com-- Fortescue Metals Group (ASX:FMG) on Tuesday posted a 41% drop in annual profit as weaker iron ore prices weighed on earnings, though record shipments and lower costs underscored the miner’s operational strength.
Shares in the Australian miner closed 3.9% lower at 19.22 Australian dollars.
The world’s fourth-largest iron ore producer posted net profit after tax of $3.37 billion for the year ended June 30, down from $5.68 billion a year earlier.
Revenue fell 15% to $15.5 billion as average hematite prices slipped 18% to $84.79 per dry metric tonne.
Underlying EBITDA fell 26% to $7.94 billion, with the margin narrowing to 51% from 59%.
Still, Fortescue achieved record shipments of 198.4 million tonnes, up 4% on the year, while cutting its C1 cash costs to $17.99 per wet metric tonne.
The Perth-based miner declared a fully franked final dividend of A$0.60 per share, bringing the full-year payout to A$1.10.
For fiscal 2026, Fortescue guided for shipments of 195-205 million tonnes and hematite C1 costs of $17.50-$18.50 per tonne.
The slump in China’s property market has curbed demand for new housing and, in turn, steel consumption, leaving Fortescue vulnerable given its reliance on Chinese buyers.
The company said realized prices were also pressured by trade frictions, geopolitical uncertainties, and increased global supply, though it stressed that demand for its ore remained firm.
Metals and Operations Chief Executive Dino Otranto was upbeat about China’s long-term outlook. “Every time I am in China, I am unbelievably impressed by the continued growth of that economy," he said.
Fortescue spent $3.93 billion in capital expenditures during the year, including $312 million for its energy division. While the miner has invested heavily in green hydrogen projects, it has scaled back plans after the Trump administration cut support for clean energy.
Last month it scrapped a project in Arizona slated for 2026 and another in Gladstone, Australia.
The company continues to see green hydrogen as a core part of its future. “No new industry or transformational shift has ever been linear—or easy,” Executive Chairman Andrew Forrest wrote in the annual report. “We haven’t always got it right, but we learn every day from advances and setbacks.”
(Ayushman Ojha contributed to this report.)