WA’s two speed-economy has been hard at work over the coronavirus pandemic delivering explosions in the net worth of iron ore magnates.
While industries such as tourism and retail struggle, sustained demand for iron ore has resulted in WA companies recording solid revenues and huge dividends being paid out to mining families.
Iron ore magnates have been raking in the cash over the pandemic period.Credit: Photographic
In its 2020 financial report Wright Prospecting, owned by Angela Bennett who is the billionaire daughter of its founder Peter Wright, and the daughters of his late son Michael Wright, recorded a 27 per cent jump in profits in just one year.
The company derives much of its income from royalties paid through iron ore partnerships Peter inked with Lang Hancock 60 years ago.
The company recorded $204 million in profit last financial year, up from $160 million in 2019, and paid out $199 million in dividends to its owners.
“The company recorded increased revenues from royalties and its interest in the Hancock & Wright partnership largely due to higher average commodity prices despite decreased shipment volumes during the year,” the report said.
The dividend windfall cements Ms Bennett as one of Australia’s richest women but her fortune pales in comparison to that of Gina Rinehart, who the AFR declared was Australia’s richest person in May when her estimated wealth hit $21.2 billion.
Nipping at her heels is Andrew Forrest, founder of Fortescue Metals Group.
FMG shares hit an all-time high of $19.30 in August, catapulting Mr Forrest’s 30 per cent shareholding in the company to nearly $18 billion.
In July the AFR’s Rich List estimates his net worth was more than $20 billion.
Stronger than expected demand from Chinese steelmakers and problems with supply from Australia's biggest competition Brazil has driven the mining sector's strong results.
State final demand figures released by the Australian Bureau of Statistics last week reveal the domestic economy – that is the economy not factoring in exports – had contracted 6 per cent, which was the biggest ever contraction on record.