With many issuers awash with cash, there has been an intense focus on capital management during this round of results. So it was no surprise to see BHP Billiton, one of the biggest cash producers of them all, give the topic plenty of attention during its interim results announcement today.
‘I would like to remind you of the discipline and consistent manner in which BHP Billiton has and will continue to prioritise the deployment of capital,’ commented CFO Alex Vanselow as BHP announced an expanded $10 bn share buyback program and dividend hike of 10 per cent.
Perhaps given the scepticism of some investors toward buybacks – particularly those in the UK – Vanselow stressed the importance to BHP of making good on its pledges.
‘I would like to emphasise that one of the key considerations when developing our capital management strategy is to ensure we can deliver on our promises, and in that context we have indicated that we expect to largely complete the $10 bn program by the end of the 2011 calendar year,’ he added. For BHP shareholders, the proof will be in the eating.