Fortescue Metals Group, Australia's third largest iron ore miner, posted on Wednesday a 259 percent increase in its half-year profit.

The company made a profit of $1.71 billion for the six months to Dec. 31, 2013, up from $478 million in the same period a year ago.

The miner lifted shipments of iron ore by 51 percent over the period while its revenue rose 77 percent to $5.8 billion due to strong iron ore price and rising production.

Fortescue Chief Executive Officer Nev Power said the record result reflected the success of the company's strategy to rapidly construct new capacity, ramp up production and drive down costs.

"The ongoing strong demand for our products has allowed us to accelerate debt repayment, de-risk the balance sheet and increase returns to our shareholders," he said in a statement.

Fortescue said its net debt position improved from $10.5 billion on June 30, 2013 to $8.6 billion on Dec. 31, 2013.

Fortescue expects its full year shipment of iron ore to be 127 million tonnes and the company confirms that delivery of the 155 mtpa (million tonnes per annum) run rate remains on target by the end of March 2014.

The company declared an interim fully franked dividend of 10 AU cents a share.