The company posted an attributable half-year profit of $US3.2 billion, above consensus of around $3 billion, and a reversal of the December 2015 half-year loss of $5.6 billion.

Underlying earnings before interest, tax, depreciation and amortisation were $9.9 billion, while the underlying EBITDA was 54%.

Net operating cashflow rose by 46% to $7.7 billion, while the company realised $1.2 billion in productivity gains

Net debt fell from $26.1 billion over the half-year period to just $20.1 billion at the end of December, beating UBS’ forecast of $23.1 billion.

“This is a strong result that follows several years of a considered and deliberate approach to improve productivity and redesign our portfolio and operating model,” BHP CEO Andrew Mackenzie said.

“The demerger of South32 and over US$7 billion of asset sales have shaped a portfolio that is now true to its strategy.

“Our assets are large, long-life and low-cost and provide exposure to a diverse mix of commodities with an attractive outlook.

“Our new operating model has sharpened the focus of our operations on the things that matter most: safety, volume and cost.”

The company announced a 150% increase in interim dividend to 40c per share, comprising the minimum 30c per share payout plus an additional 10c per share.

“In recognition of the importance of shareholder returns and confidence in the company’s performance, the board has determined to pay an additional amount of 10c per share, taking the overall interim dividend to 40c per share,” Mackenzie said.

“We are confident in the long-term outlook for our commodities, particularly oil, with markets expected to rebalance in the near-term, and copper where we expect a deficit to emerge in the early 2020s.”

BHP said it remained on track for $1.7 billion of productivity gains over the 2017 financial year, excluding the potential impact of the ongoing Escondida strike.

The company has placed guidance for Escondida under review.

Cost guidance for the full-year has also been slightly lifted for iron ore from $14 per tonne to less than $15/t, while coal guidance is now $54/t, up from $52/t, due to negative foreign exchange impacts in Australia.

Capital and exploration spend for the half is down by 38% to $2.7 billion, though guidance has been lifted for FY17 and FY18 to reflect increased petroleum exploration.

FY17 spend is now expected to be $5.6 billion, up $1 billion, while FY18 spend has been boosted by $900 million to $6.3 billion.

Shares in BHP rose by nearly 1% to $A26.73, though the result was released after market close.