BHP Billiton, the world's largest mining company, on Monday posted record net income for the year ended June 30, helped by the rise in commodity prices and the company's ability to raise production levels and pass on higher costs.

BHP, which is seeking to buy its rival Rio Tinto, posted net income of $15.4 billion for the 12 months ended June 30, from $13.4 billion a year earlier. That rise, of 14.7 percent, matched analysts' estimates.

BHP cited "excellent operating performance, cost control and the delivery of high-margin growth projects into strong market conditions" for the results.

Revenue rose 25.3 percent to $59.5 billion. BHP also increased its dividend for the year - to 41 cents a share, from 27 cents - saying it was a "strong signal of our confidence" in the outlook.

"All in all, the results were pretty good," said Stephen Pope, chief global market strategist at Cantor Fitzgerald in London. "Their ability to sell in China and India is still strong."

In July, BHP reached an agreement with the Chinese steel maker Baosteel to nearly double the price of its iron ore for the year to March 2009, matching an agreement reached by Rio Tinto weeks earlier.

Pope said it was in a strong position to keep prices high - something that has raised concerns in China about a possible deal with Rio. "Where else are the customers going to go?"

BHP cited strong profit margins in base metals, iron ore, manganese and energy coal, and petroleum. It was the seventh consecutive year that it had posted a record net income figure.

"We're well set for the future," the chief executive, Marius Kloppers, said during a conference call with analysts. "We have a low-risk growth portfolio; we can contend with all sorts of headwinds and tail winds and still turn in great results."

Kloppers noted, however, that weaker demand from developed economies amid high food and energy prices was bringing "some flow through to the developing economies."

Still, most of the slowdown in demand in emerging economies appeared to be occurring in the light manufacturing sector, he said.

Kloppers said that BHP, which is based in Australia and Britain, was also facing "serious challenges" limiting production expansion amid the surge in demand for commodities in recent years, driven in particular by China, India, Brazil and Russia.

He cited a tight market in skilled labor, power shortages and other infrastructure problems, the emergence of export tariffs and quotas and an effort to secure control over resources in some host countries.

In recent weeks, commodity prices have fallen from their highs, led by oil and metals, pulling down the value of mining stocks.