BHP SEES STRONG FOURTH QUARTER BUT LOWER YEAR NET The Broken Hill Pty Co Ltd <BRKN.S> said it expects a strong full year result, helped by sigificant investment allowance credits in the fourth quarter, but net will fall short of the record 988.2 mln dlrs earned in 1985/86 ended May 31. The group earlier reported its net earnings dropped to 603.0 mln dlrs in the first three quarters ended February 28 from 813.0 mln a year earlier. Third quarter net fell to 206.0 mln dlrs from 238.6 mln a year earlier and 220.3 mln in the second quarter ended November 31, BHP said in a statement. Earnings in the first nine months were at the lower end of share analysts' forecasts yesterday of a range of 600 mln to 620 mln dlrs. BHP held its annual dividend unchanged at 37.5 cents after declaring a steady final dividend of 20 cents and announced a one-for-five bonus issue to shareholders registered May 1. The bonus is being made from reserves which will not qualify for tax-free distribution after the introduction of dividend imputation next July 1. The bonus shares will not rank for the final dividend, BHP said. BHP said it should not be expected that the present rate of dividend will be maintained on the increased capital. The level of future dividends will be influenced by the implications of the proposed dividend imputation legislation, it said. As previously reported, dividends will become tax-free in shareholders' hands provided they are paid out of profits that have borne the full 49 pct company tax rate. BHP, which confined comment to the third quarter, said petroleum net earnings dropped to 98.8 mln dlrs from 139.6 mln a year earlier, and steel profit to 27.0 mln from 48.8 mln. BHP said the petroleum division earnings fall reflected generally lower oil prices and sales volumes from Bass Strait while the steel decline was due to a five pct fall in domestic sales and higher costs associated with the commissioning of new plant and some operational difficulties. The rise in third quarter minerals net to 95.7 mln dlrs from 81.5 mln a year earlier largely reflected the increase in ownership of the Mt Newman iron ore project, it said. The 60.7 mln dlr extraordinary gain, all in the third term, reflected a 240.7 mln profit on the sale of <Blue Circle Southern Cement Ltd> offset by a U.S. Oil acreage writedown.