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(Alliance News) - BHP Group Ltd warned on Thursday that the geopolitical landscape continued to change and economic conditions remained uncertain in the short term.
Speaking ahead of the annual general meeting to be held in person on Thursday, BHP Chair Ken MacKenzie said the mining firm was "fundamentally repositioned" for the future, highlighting its foray into potash.
The Australian miner recognises that demand for potash will increase because the world will need more food. Potash is potassium-containing salts used as fertiliser.
BHP has said it was working to bring forward first production at its Jansen potash project in Canada to 2026. In 2021, it approved capital expenditure of USD5.7 billion for its Jansen stage 1 potash project.
"Potash is a new commodity for BHP which has the potential to deliver value for a century or more," MacKenzie will tell shareholders.
MacKenzie also noted the group has recently merged its petroleum business with Woodside Energy Group Ltd; simplified its coal portfolio to focus on higher-quality metallurgical coal used for steelmaking; and unified its corporate structure.
The chair will also tell shareholders that the short-term outlook was complex, with the geopolitical landscape continuing to change and economic conditions remaining uncertain.
There are ongoing labour and skills shortages, while countries are emerging from the impact of the global Covid-19 pandemic at different paces, he said.
Despite the challenging environment, the company delivered strong operational and financial results for the financial year to June 30.
Over this period, BHP posted record earnings before interest, taxes, depreciation and amortisation of USD40.6 billion, up 16%.
Revenue for the financial year ended June 30 rose 14% to USD65.10 billion from USD56.92 billion. Pretax profit was 36% higher at USD33.14 billion from USD24.29 billion.
BHP's full-year payout totalled 325.0 cents, up 8.0% from 301.0 cents the previous year. It also paid a specie dividend of 386.4 cents as a result of its merger with Woodside.
MacKenzie said the repositioning of the company will align it with the "megatrends" of decarbonisation, population growth and demand for higher standards of living.
The demand for copper, nickel and steel will grow to enable the infrastructure and products required for the energy transition, he said.
Chief Executive Mike Henry, addressing the AGM, will tell shareholders that the company continued its track record of transforming itself to meet the needs of the world.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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