BHP Billiton: Digging Into A Dividend Cut

Summary
Share prices continue to be stuck around 10-year lows as shareholders suffer.
Chairman opens the door to a dividend cut as focus shifts toward the balance sheet.
I'm expecting a 50% dividend cut in 2016, reducing yield to around 4.4% based on today's prices.
BHP Billiton (BHP, BBL), the world largest diversified resources company, gathered on November 19th to hold its annual general meeting given by the Chairman Jacques Nasser and CEO Andrew Mackenzie. While the general meeting did not provide a lot of outlook regarding the sector, the all important board leader did highlight the general focus for the company going forward.
As you know, there has been a significant drop in the share price and this is disappointing from a shareholder perspective and by the board itself. During the meeting the Chairman reiterated the company's focus on creating value through the cyclical cycles and the focus remains to be on a long-term basis despite the volatility.
The Outlook and Dividend
In 2015 record production of iron ore, metallurgical coal and oil helped the company sustain fairly good earnings. That said, it's difficult to give a definitive view of 2016 as the major world economies remain in flux. A recovery of growth in China and the U.S. and the developing economies will be required for the company to return to previous levels of growth.
The dividend was addressed by the chairman in his portion of the presentation. He described the... Read more