The world's largest mining firm, BHP Billiton, saw its profits cut by 52% over the past year, leading it to slash exploration spending and its outlook on Chinese steel demand in a bid to reposition itself for the future. The multinational mining, metals and petroleum company reports its underlying attributable profits sank to $6.4bn (£4bn), a fall of 52%, in the year ending 30 June 2015. BHP Group also saw after-tax profits fall 86.2% from $13.8bn in 2014 to $1.9bn.

BHP's production of commodities copper and coal for power plants slowed rapidly in the past year on weakening Chinese demand. It's production of petroleum and iron ore saw growth.

"In the short-term we expect ongoing economic reforms in China to contribute to periods of market volatility," said BHP Billiton Chief Executive Officer, Andrew Mackenzie. At the same time "we have lowered our forecast of peak Chinese steel demand to between 935m tonnes and 985m tonnes in the mid 2020s," he said as he worked to reposition the company moving forward.

Further changes as a result of the commodity slowdown will see BHP cut capital and exploration expenditure for new projects. It will be slashed from $11.0bn in the reporting period to $8.5bn in 2016 and again to $7bn in 2017.

The cuts will allow BHP to create "capital flexibility to improve our competitiveness", said Mackenzie. Cost reductions will be made across the company in financial 2016 he added.

Along with the cuts the company will reach for productivity gains by stretching capacity. The company reports that its Western Australia iron ore project can be modified with a small investment to increase its workload from 254m tonnes today to 290m tonnes.

The announcement saw the company's stocks gain 6.61% on the London stock exchange by mid-morning on 25 August. This partly reversed a -9.20% fall in the stock's value the day before when fears about the weakening Chinese demand for commodities gripped global markets.

"Beyond this, we continue to reduce development costs within our project portfolio," said Mackenzie. "We remain focused on value and will only approve projects when the time is right".