The world's largest mining company BHP Billiton posted a 14.7 per cent growth to $15.39 billion as against its previous year profit of $13.42 billion as a result of higher prices and production volumes.

The company portrayed an upbeat outlook, and used the occasion to put forth its view that a possible takeover of its target, mining major Rio Tinto Ltd, now made a lot more sense than previously, given the increasing cost pressures in the industry.

The world's second-largest iron ore exporter Rio Tinto Group had earlier in June finalised iron ore contracts with Asian steel makers at a 97-per cent premium. (See: Rio hikes iron ore contract prices for Asian steel mills by 97 per cent)

BHP Billiton had launched a $147.4 billion bid for London-based Rio earlier in the year, which was duly rejected by the target company's board, with Rio Tinto maintaining that BHP's previous informal $130-billion bid undervalued the company, and that the improved bid also failed to recognise the underlying value of its mining assets.

Offering an optimistic view, BHP said it foresees short-term global economic growth to slow, though it would remain strong given continued domestic infrastructure investment and regional trade. It did caution that rising inflation would most likely have some negative impact on emerging market economies, hinting at the likes of the BRIC countries.

BHP said that China's continuing massive industrialisation translates into robust support for the global economy, and the consequent demand for raw materials remains strong, though in the short-term it expect prices to remain high relative to historical levels, ''albeit with higher volatility.

Acknowledging pressures in the mining industry, BHP said costs had gone up by $1.18 billion year on year, with around $575 million as a consequence of higher fuel, energy and raw material prices. The company's total cost base increased by 4.3 per cent year on year, excluding non-cash costs of $216 million. However, revenues too climbed 25.3 per cent year on year to $59.47 billion, from $47.47 billion in the previous year.

The miner's full year profit got a boost from strong second half production records across key commodities, at the same time when oil prices peaked at record highs, contract coking coal prices tripled, and Australian miners won an average hike of 85 per cent in contract iron ore prices, lead by Rio Tinto's hike of 97 per cent.

Industry sources expect Rio Tinto to release its first half results next week, with analysts forecasting an average of net profit hike of around 45 per cent to $5.1 billion from last year's $3.52 billion. Though Tinto benefits from higher iron ore and copper prices, it lacks an oil division and limited coking coal. Consequently, analysts say BHP will use its earnings as a great talking point to its advantage in the takeover arguments.