BHP Group Regulatory News (BHP)

20 February 2024

Safety

Social value

Fatality at BMA

Female employee representationi

36.2% Up 2.6% pts

HY23 33.6%

A team member from one of BHP Mitsubishi Alliance (BMA)'s sub-contracting partners was fatally injured in an incident at BMA's Saraji mine in January. Investigations into the incident are underway.

We have more than doubled our female employee representation since announcing in 2016 our aspiration to achieve a gender-balanced workforce, and more than 30% of our people leaders are female.

Financial performance

Underlying attributable profitii

US$6.6 bn

HY23 US$6.6 bn

Attributable profit

US$0.9 bn Down 86%

HY23 US$6.5 bn

Our underlying attributable profit was in line with HY23, as a result of strong revenue generation and disciplined cost control. All assets are on track to meet their FY24 production and unit cost guidance. FY24 production and unit cost guidance for BMA was revised at the Q2 Operational Review.

Our attributable profit decreased as a result of an exceptional loss of US$5.6 bn following an impairment of Western Australia Nickel, and an increase to the provision related to the Samarco dam failure.

Capital management

Capital and exploration expenditureii

US$4.7 bn Up 57%

HY23 US$3.0 bn

Fully franked interim dividend

US$0.72 per share

56% payout ratio

We are investing in growth and increased our capital and exploration spend by 57% including at Jansen and Copper South Australia.

We have determined an interim dividend of US$3.6 bn. This follows our strong returns to shareholders in CY23, when we were the highest dividend payer on the ASX.

Revenue

US$27.2 bn Up 6%

HY23 US$25.7 bn

Attributable profit

US$0.9 bn Down 86%

HY23 US$6.5 bn

Underlying attributable profit

US$6.6 bn

HY23 US$6.6 bn

Profit from operations

US$4.8 bn Down 56%

HY23 US$10.8 bn

Underlying EBITDAii

US$13.9 bn Up 5%

HY23 US$13.2 bn

Underlying EBITDA marginii

53.3%

HY23 53.5%

Adjusted effective tax rateii

31.0%

HY23 29.5%

FY24e 30 - 35%

BHP's revenue increased by US$1.5 bn primarily as a result of higher iron ore and copper prices, as well as the contribution of new mines Prominent Hill and Carrapateena. These were partially offset by New South Wales Energy Coal (NSWEC), where despite a 43% increase in sales volumes, realised prices decreased by 65%.

We continue to experience the impacts of inflation on our underlying cost base, particularly on labour and parts, as reflected in a global inflation rate of 6.3% across our operating jurisdictions during CY23.

Unit costsii were however approximately 5.4%iii higher across our major assets during HY24 reflecting our disciplined cost and reliable operational performance and the normalisation of commodity linked consumable prices such as diesel and acid.

This strong operational performance saw Western Australia Iron Ore (WAIO) maintain its lead as the lowest cost major iron ore producer globally and overall Group Underlying EBITDA increase by 5%, with an Underlying EBITDA margin of 53.3%.

For further details see Underlying EBITDA waterfall.

We expect the lagged impact of global inflation to continue into H2, particularly in relation to labour, and as we negotiate long-term supply arrangements.

We continue to assess the impact of the Australian Federal Government's 'Same Job Same Pay' industrial relations reforms which will add to our labour costs.

Underlying attributable profit was in line with the prior period, however we reported an exceptional loss, which decreased attributable profit by US$5.6 bn, due to:

· a US$2.5 bn impairment of Western Australia Nickel; and

· a US$3.2 bn charge related to the Samarco dam failure.

For further details see note 2 - Exceptional items and note 9 - Significant events - Samarco dam failure.

Our adjusted effective tax rate of 31% was above the 30% Australian corporate tax rate. The adjusted effective tax rate for FY24 is still expected to be in the range of 30 to 35%.

Our operating costs include US$1.8 bn of revenue or production based royalties. Once these are included, our Group effective tax rate was 40.9%. The average comparable rate of ASX50 companies is approximately 30%iv.

For further details see Adjusted effective tax rate.

Detailed financial information is included in Appendix 1

Net operating cash flow

US$8.9bn Up 31%

HY23 US$6.8 bn

Capital and exploration expenditure

US$4.7 bn Up 57%

HY23 US$3.0 bn

Free cash flowii

US$3.8bn Up 9%

HY23 US$3.5 bn

Net debtii

US$12.6 bn

FY23 US$11.2 bn

HY23 US$6.9 bn

Gearing ratioii

21.7%

FY23 18.7%

HY23 12.9%

Our net operating cash flow increased by 31% as a result of the higher Underlying EBITDA and lower income tax and royalty-related taxation payments, partially offset by an increase in working capital.

In line with our Capital Allocation Framework (CAF), we generated free cash flow of US$3.8 bn after investing US$5.1 bn. Our investments in the period included:

·  US$3.4 bn in organic development including US$1.7 bn on improvement projects; US$1.3 bn major capital in facing?commodities; and US$199 m of exploration spend; and

·  US$1.4 bn of maintenance and decarbonisation expenditurev.

Capital and exploration expenditure is expected to bevi:

·  For FY24 and FY25, ~US$10 bn per annum, including US$0.4 bn of exploration in FY24; and

·  In the medium term, ~US$11 bn per annum on averagevii.

We have flexibility to adjust capital spend and phasing of projects to accommodate market dynamics and cash flow generation.

BHP's balance sheet remains strong. During the half, BHP issued US$4.8 bn of new bonds and retired US$5.7 bn of debt of which US$5 bn related to the OZL acquisition facility.

Our net debt increased by US$1.5 bn to US$12.6 bn from 30 June 2023, largely reflecting net operating cash flow more than offset by:

·  Payment of dividends to BHP shareholders of US$4.0 bn, and to non?controlling interests of US$0.6 bn; and

·  Capital and exploration expenditure of US$4.7 bn.

Our net debt target range of between US$5 and US$15 bn enables us to maintain a resilient balance sheet during periods of change and external uncertainty while retaining the flexibility to allocate capital within our CAF towards shareholder returns and growth opportunities.

For further details see Net debt waterfall.

Detailed financial information is included in Appendix 1

Interim dividend

72 US cps

Fully franked

56% payout ratio

Underlying return on capital employed (ROCE)ii

26.4%

HY23 29.4%

Earnings per share - basic

18.3 US cps

HY23 127.5 US cps

Earnings per share - Underlyingii

129.6 US cps

HY23 130.3 US cps

Our operations continued to generate strong Underlying ROCE of 26.4%, including 62% at WAIO.

An interim dividend of US$0.72 per share (US$3.6 bn), equivalent to a 56% payout ratio will be paid to shareholders on 28 March 2024.

This extends our track record of strong returns. Including the determined dividend, we will have returned ~US$44 bn cash to shareholders since 1 January 2021.

Events in respect of the interim dividend

Date

Announcement of currency conversion into RAND

27 February 2024

Last day to trade cum dividend on Johannesburg Stock Exchange Limited (JSE)

5 March 2024

Ex-dividend Date JSE

6 March 2024

Ex-dividend Date Australian Securities Exchange (ASX), London Stock Exchange (LSE) and New York Stock Exchange (NYSE)

7 March 2024

Record Date

8 March 2024

Announcement of currency conversion into AUD, GBP and NZD

11 March 2024

DRP and Currency Election date

11 March 20241 

Payment Date

28 March 2024

DRP Allocation Date2

15 April 2024

Risk and Audit

Committee

Nomination and Governance Committee

People and Remuneration

Committee

Sustainability

Committee

Michelle Hinchliffe (Chair)

Xiaoqun Clever-Steg

Ian Cockerill

Christine O'Reilly

Ken MacKenzie (Chair)

Gary Goldberg (SID)1

Michelle Hinchliffe

Christine O'Reilly

Christine O'Reilly (Chair)

Catherine Tanna

Dion Weisler

Gary Goldberg (SID) (Chair)

Ian Cockerill

Catherine Tanna

Dion Weisler

Detailed financial information on all business segments in the Financial performance summary

Production

894 kt Up 7%

HY23 834 kt

FY24e 1,720 - 1,910 kt

Average realised price

US$3.66/lb Up 5%

HY23 US$3.49/lb

Underlying EBITDA

US$3.5 bn Up 23%

HY23 US$2.8 bn

25% contribution to the Group's Underlying EBITDA

46% Underlying EBITDA margin

Underlying ROCE

10%

HY23 11%

Capital and explorationexpenditure

US$2.0 bn

HY23 US$1.3 bn

FY24e US$4.2 bn

Despite a 5% increase in prices from HY23 to HY24, copper prices declined slightly over the CY23 period, with intra-year movement driven by shifting expectations of China's recovery, and demand risk in the OECD from manufacturing weakness, global inflation and tighter financial conditions. Extremely low global copper inventories, rising mine costs and the sector's vulnerability to operational disruptions helped to establish a higher floor for prices than seen in prior downturns in OECD manufacturing.

In the near term, we expect broad-based end-user demand growth in China to continue, albeit at a somewhat slower pace than the 6% YoY rate seen in CY23. That view includes an assumption of rapidly increasing investment in lower GHG technology for energy and transport. We anticipate a modest recovery in OECD copper demand. A broadly balanced market is the most likely outcome for CY24. That compares to our view of six months ago that a modest surplus was likely. The major difference in the two forecasts are reductions in primary supply announced by copper producers late in CY23. Uncertainty in primary supply remains a key swing factor. In the medium and longer term, traditional demand (such as home building, electrical equipment and household appliances) is expected to remain solid while the decarbonisation mega-trend is expected to bolster demand. In terms of meeting that demand, we anticipate that the cost curve is likely to steepen as challenges to the development of new resources (such as societal expectations, decarbonisation and water challenges) progressively increase. We anticipate that the industry is likely to enter the final third of this decade with a low inventory buffer, which implies that should deficits occur in this phase, as we expect they will, elevated pricing that is well above the cost curve may well occur during this period. Recent negative surprises to the primary supply outlook could bring deficits forward.

Integration of the Copper South Australia province has successfully achieved more than US$50 m of annualised EBITDA synergies six months ahead of schedule, with each of Olympic Dam, Carrapateena and Prominent Hill delivering strong safety, production and development outcomes. We have also had exploration success in South Australia, announcing an Exploration Target at Oak Dam in July and multiple intersects of copper grade above 1% (and areas above 2%) beneath Olympic Dam (OD Deeps) in January. This operational performance, coupled with the significant resource base, provide a solid foundation on which to study further value realisation, including the potential to grow annual copper production at Copper South Australia to above 500 ktpa.

In Chile, we continue to progress a range of studies to unlock the next phase of value from our significant resource endowment and utilise latent capacity across our Escondida, Spence and Cerro Colorado operations. These include studying concentrator options at Escondida and the evaluation of multiple leaching technologies which could be applied across all three operations. We expect to provide further information on potential development pathways during CY24.

In Peru, Antamina has received environmental approval to extend operations from 2028 until 2036.

Copper production

Unit cost1,2

Underlying EBITDA

528 kt Up 3%

US$1.51/lb Up 5%

US$2.3 bn Up 9%

HY23 511 kt

FY24e 1,080 - 1,180 kt

FY25 and FY26e 1,200 - 1,300 ktpa

HY23 US$1.44/lb

FY24e US$1.40 - US$1.70/lb

FY25 and FY26e US$1.30 - US$1.60/lb

HY23 US$2.2 bn

1 Based on average exchange rates of: HY24 USD/CLP 874 (realised); HY23 USD/CLP 920 (realised); FY24e - FY26e USD/CLP 810 (guidance).

2 Refer to Non-IFRS financial information for detailed unit cost reconciliation.

Underlying EBITDA increased by 9% primarily as a result of:

· Higher copper prices. which had a favourable US$0.2 bn impact; and

· Increased sales volumes in line with improved concentrator feed grade and higher concentrator throughput.

These were partially offset by higher operating costs, primarily reflecting inventory drawdowns to maintain concentrator ore feed and the impacts of inflation.

Escondida production guidance for FY24 remains unchanged at between 1,080 and 1,180 kt, increasing to between 1,200 and 1,300 ktpa in FY25 and FY26, after which production is expected to decline to between 900 and 1,000 ktpa for a period in line with lower concentrator feed grades.

Escondida is assessing multiple options to offset the impact of lower concentrator feed grade, which is expected from FY27. These include the potential for a new concentrator to replace the current Los Colorados facility and the application of one or more leaching technologies to improve recoveries and unlock primary sulphide resources. We expect costs associated with the studies, which are captured as operating costs, to increase to ~US$140 m per year in both FY24 and FY25, from ~US$60 m in FY23.

Full SaL, a BHP designed leaching technology, is on track for first production in FY25 and is expected to unlock ~410 kt in copper cathodes over a 10-year period through improved recoveries and shorter leach cycle times. The capital expenditure to implement Full SaL is expected to be approximately US$300 m.

Deployment of autonomous haulage is expected to begin in the Escondida Norte pit in H2 FY24 and ramp up to approximately 50 autonomous trucks over the next three years. Escondida is evaluating transitioning its fleet of approximately 160 conventional haul trucks to autonomous operations over the next decade.

New royalties came into effect for Escondida from 1 January 2024. These will not be included in Escondida unit costs.

Copper production

Spence unit cost1,2,3

Underlying EBITDA

138 kt Down 6%

US$1.98/lb Down 10%

US$0.4 bn Up 37%

HY23 147 kt

FY24e 210 - 250 kt1

Medium-term ~250 ktpa

HY23 US$2.19/lb

FY24e US$2.00 - US$2.30/lb

HY23 US$0.3 bn

1 Production and unit cost guidance for FY24 is provided for Spence only. Cerro Colorado produced 11 kt before ceasing production on 9 November 2023.

2 Based on average exchange rates of: HY24 USD/CLP 874 (realised); HY23 USD/CLP 920 (realised); FY24e USD/CLP 810 (guidance).

3 Refer to Non-IFRS financial information for detailed unit cost reconciliation.

Underlying EBITDA increased by 37% predominately as a result of:

· Increased sales volumes at Spence driven in part by record concentrate production following improvement in concentrator throughput and recoveries;

· Higher copper prices, which had a favourable US$51 m impact; and

· Lower commodity-linked consumable prices.

These were partially offset by costs associated with Cerro Colorado's transition to temporary closure in December 2023.

Our application for environmental approval to extend the life of the Spence leaching facilities to 2039, was lodged in FY23. If approved, this would involve the implementation of a novel approach to re-processing previously leached ores followed by a planned medium-term transition to chalcopyrite ore leaching.

Spence remains on-track to achieve fully autonomous mine haulage operations in Q4 FY24 following the successful extension of autonomous truck operations to the cathode ore crushing circuit in January 2024. In total, Spence has deployed 23 of 33 planned autonomous trucks.

The concentrator plant modifications, which commenced in August 2022, are expected to be completed in FY24. In the Q2 FY24 Operational Review, we announced approval of an incremental US$570 m in sustaining capital to progress remediation of previously identified anomalies in the Spence Tailings Storage Facility (TSF). These remediation plans have been developed in consultation with the Engineer of Record, Independent Tailings Review Board and expert consultants.

Production guidance for Spence for FY24 remains unchanged at between 210 and 250 kt, and is expected to average 250 ktpa over the next five years. This guidance remains subject to successful remediation of the TSF anomalies.

Cerro Colorado entered temporary care and maintenance in December 2023. Cerro Colorado's estimated expenditure of US$45 m for H2 FY24 remains unchanged. We are exploring options to extend the life of Cerro Colorado, including through the use of novel leaching technologies and desalinated water, which could see the operation restart after 2030, subject to environmental approvals.

Copper production

Underlying EBITDA

154 kt Up 48%

US$0.6 bn Up 128%

HY23 104 kt

FY24e 310 - 340 kt

HY23 US$0.3 bn

Underlying EBITDA increased 128% predominantly as a result of:

· The contribution of US$0.3 bn from Carrapateena and Prominent Hill which were acquired in May 2023 as part of the acquisition of OZL; and

· Higher average realised prices for copper, uranium, gold and silver, which had an impact of US$0.1 bn.

This was partially offset by inflationary impacts on labour and contractors, additional planned maintenance and increased exploration activity at Oak Dam and OD Deeps.

Integration of OZL has successfully delivered more than US$50 m of annualised EBITDA synergies ahead of schedule through supply chain optimisation and reducing corporate overheads. The operations are performing well with record copper concentrate production at Carrapateena, record gold production at Olympic Dam and record development metres at Prominent Hill. We are looking to apply best practice from across the operations to further optimise operational performance and lift productivity.

Production guidance for FY24 remains unchanged at between 310 and 340 kt, net of the planned transfer of copper concentrate from Prominent Hill to Olympic Dam for processing to realise improved margins by processing high-uranium concentrate into cathode.

We are assessing options for a new two-stage smelter which could produce more than 500 ktpa of copper, with a Final Investment Decision expected between FY26 and FY27. In addition to productivity improvements mentioned above, we are undertaking the following growth projects:

· At Prominent Hill, the Wira shaft mine expansion project is under construction. After a review of this project, it is expected to come online in FY26, for a total investment of US$673 m, both in-line with our estimates as part of the acquisition. The hoisting shaft is expected to extend the mine life to at least 2036 and may provide access to potential mineralisation outside the current mine plan.

· At Carrapateena, the Block Cave Expansion project is progressing and is expected to (i) extend the mine life beyond the existing sub-level cave and (ii) increase production at Carrapateena from FY29. Crusher 2 is still expected to come online in Q3 FY24 and to ramp up in Q4 FY24, which will provide an uplift in mine productivity.

We have had continued exploration success at Oak Dam and OD Deeps, and are progressing the external approval process for an access decline at Oak Dam to enable faster and lower cost resource definition drilling of the mineral deposit.

Production

129 Mt Down 2%

HY23 132 Mt

FY24e 254 - 264.5 Mt

Average realised price

US$103.70/wmt Up 21%

HY23 US$85.46/wmt

Underlying EBITDA

US$9.7 bn Up 27%

HY23 US$7.6 bn

68% contribution to the Group's Underlying EBITDA

69% Underlying EBITDA margin

Underlying ROCE

85%

HY23 61%

Capital and exploration expenditure

US$1.0 bn

HY23 US$0.9 bn

FY24e US$2.0 bn

China posted record iron ore consumption and near-record blast furnace utilisation rates in CY23, while India continued to exhibit rapid growth in steel production. In contrast developed regions saw steel output contract once again, albeit at a lesser rate than in CY22. The global result was a considerable improvement from the 4% decline in CY22, although the precise scale of the turnaround in China for CY23 is not clear from publicly reported data.

Over the next two years we expect a small further improvement in global steel production with growth led by India, Southeast Asia and to a lesser extent China. We expect that reduced drag from developed regions will also help.

In China, steel production was resilient at high levels in CY23, making it the 5th consecutive year the country produced more than 1 Bt of steel. Weakness in the real estate sector, was more than offset by healthy growth in infrastructure, machinery and autos, as well as net steel exports reaching a seven-year high. In CY24 we expect modest growth in steel production in line with our long-held view that China's steel production would sit at a plateau in the 1.0 to 1.1 Btpa range in the first half of the 2020s.

India was a continued bright spot with steel production rising around 12% to ~140 Mt in CY23. That is a 40% increase since the beginning of the decade. In CY24 we expect another year of strong growth as construction demand remains robust. Medium term, we note that the Indian government is targeting 300 Mtpa of steel-making capacity by 2030.

In iron ore, conditions improved in CY23 with a broadly balanced market overall, notwithstanding volatility in pricing within the year. For CY24 we expect similar dynamics for the mass balance, but with both supply and demand growth to slow somewhat from the rates of the prior year. Low-cost supply is not growing at a rate sufficient to displace the high-cost production which is required to keep the market balanced. Our estimate of real-time cost support sits in the US$80 - US$100/t range on a 62% Fe CFR basis, unchanged from our previous reporting period. How effectively China's stimulus policy is implemented, especially with regards to real estate, and how the government chooses to regulate steel production, are both swing factors in CY24.

In the medium term, China's demand for iron ore is expected to be lower than it is today as it moves beyond its crude steel production plateau and the scrap-to-steel ratio rises, though we expect demand for our products from elsewhere in developing Asia will offset this to a degree.

At WAIO, we are focused on increasing production to greater than 305 Mtpa over the medium term. We are also studying options for growth of the WAIO business up to 330 Mtpa and we expect to complete these studies in CY25. Options under consideration include developing new mines, expanding and leveraging existing infrastructure, including at Yandi and Port Hedland, increasing ore beneficiation and building a new hub.

In Brazil, Samarco is ramping up production and supporting the local community through jobs, investment and taxes. The Renova Foundation continues to make progress on remediation activity and compensation.

Iron ore production

Unit cost1,2

Underlying EBITDA

126 Mt Down 3%

US$18.46/t Up 1%

C1ix US$15.98/t3

US$9.6 bn Up 27%

HY23 130 Mt

FY24e 282 - 294 Mt (100% basis)

Medium-term >305 Mtpa (100% basis)

HY23 US$18.30/t

FY24e US$17.40 - US$18.90/t

Medium-term

HY23 US$7.6 bn

1 Based on average exchange rates of: HY24 AUD/USD 0.65 (realised); HY23 AUD/USD 0.67 (realised); FY24e and medium-term AUD/USD 0.67 (guidance).

2 Refer to Non-IFRS financial information for detailed unit cost reconciliation.

3 C1 unit costs for HY23 were US$15.50/t. WAIO C1 unit cost excludes third party royalties of US$1.99 per tonne (HY23: US$1.52 per tonne), net inventory movements US$(0.43) per tonne (HY23: US$0.57 per tonne), depletion of production stripping US$0.77 per tonne (HY23: US$0.84 per tonne), exploration expenses, marketing purchases, demurrage, exchange rate gains/losses, and other income US$0.15 per tonne (HY23: US$(0.14) per tonne).

Underlying EBITDA increased by 27%, primarily driven by:

· Higher average realised prices for iron ore, which increased by 21% and had a favourable impact of US$2.3 bn; and

· Lower diesel prices.

This was partially offset by higher price-linked royalties and the impacts of inflation.

During HY24, WAIO maintained its lead as the lowest cost major iron ore producer globally with a C1 unit cost of US$15.98/t.

South Flank remains on track to ramp up to full production capacity of 80 Mtpa (100% basis) by the end of FY24. South Flank's high quality ore is expected to maintain WAIO's average iron ore grade of at least ~61% (excluding Yandi) and increase the overall proportion of lump to between 30% and 33%.

WAIO production guidance for FY24 remains unchanged at between 282 and 294 Mt (100% basis). In support of growing the business to produce >305 Mtpa in the medium term, we are undertaking the following projects:

· The Port Debottlenecking Project (PDP1) which remains on track to be completed in CY24 following commissioning in December 2023, and is expected to deliver an uplift in port throughput;

· The Rail Technology Programme (RTP) will be rolled out over the next few years, and is expected to improve communications and signalling, enhance operational safety and reduce variability on our WAIO rail network;

· The Western Ridge Crusher Project (WRC) was approved by the Board in February 2024 for an expected investment of US$943 m (100% basis). It is expected to deliver ~25 Mtpa (100% basis) from FY28 at a capital intensity of US$38/t, to replace production from the depleting orebodies around Newman.

Average annual sustaining capital expenditure guidance over the medium term, excluding costs associated with operational decarbonisation and our automation programs, remains unchanged at US$5.50/tvi.

Iron ore production

Total Renova Foundation spend

2.5 Mt Up 13%

US$7.2 bn1 Up 22%

HY23 2.2 Mt

FY24e 4 - 4.5 Mt

HY23 US$5.9 bn1

1 Refers to total Renova spend since 2016 (100% basis).

Samarco continues to operate safely and efficiently since re-starting operations in December 2020. Production increased 13% in HY24 to 2.5Mt (5.1 Mt on a 100% basis), as a result of higher concentrator throughput. Production guidance for FY24 remains unchanged at between 4 and 4.5 Mt.

The restart of the second concentrator, which will increase pellet production capacity to approximately 16 Mtpa (100% basis) through a filtration and dry stack tailings solution, is expected to deliver first production in Q3 FY25.

In December 2023, Samarco completed the restructure of its finances by issuing new debt under the Judicial Reorganisation process. All eligible employees and small suppliers who had claims under the Judicial Reorganisation process have been paid in full. The restructure provides Samarco with a stable financial position to support the funding of its remediation and compensation obligations, as well as to fund the expansion of its operations and continue to benefit its communities through job creation, investment and taxes.

BHP Brasil remains committed to supporting the Renova Foundation and its work to progress the remediation and compensatory programs to restore the environment and re-establish communities affected by the Samarco dam failure. Renova made strong progress during HY24, and since March 2016, it has paid compensation and financial assistance to approximately 430,000 people and completed approximately 84% of resettlement casesx.

For the half year ended 31 December 2023, BHP Brasil has recognised an income statement charge of US$3.2 bn in relation to the Samarco dam failure, which predominantly reflects the change in the assessment of the estimated costs to resolve all aspects of the Federal Public Prosecution Office Claim and the Framework Agreement obligations. As at 31 December 2023 BHP Brasil's provision for the Samarco dam failure is US$6.5 bn.

For further information, please see note 9 - Significant events - Samarco dam failure for the Samarco dam failure provision.

Production

Metallurgical coal

11.3 Mt Down 17%

HY23 13.6 Mt

Energy coal

7.5 Mt Up 36%

HY23 5.5 Mt

Average realised price

Metallurgical coal

US$266.43/t Down 1%

HY23 US$268.73/t

Thermal coal - export

US$123.29/t Down 65%

HY23 US$354.30/t

Underlying EBITDA

US$1.0 bn Down 63%

HY23 US$2.6 bn

7% contribution to the Group's Underlying EBITDA

26% Underlying EBITDA margin

Underlying ROCE

15%

HY23 55%

Capital and exploration expenditure

US$0.4 bn

HY23 US$0.2 bn

FY24e US$0.7 bn

Metallurgical coal prices moved higher in the second half of CY23 on tight fundamentals, particularly on the supply side of the industry. Pig iron production grew strongly in India and China, while it contracted heavily in Europe and was flat in developed Asia. Australian seaborne supply fell for a 4th consecutive year, while Mongolian exports doubled year-on-year.

In the near term, based on public company guidance we expect a modest supply recovery from Australia into the seaborne market. The availability of land borne imports and the operational performance of Chinese domestic mines are key uncertainties for assessing China's role in the seaborne trade in CY24. On seaborne demand, India is expected to maintain its current strong momentum while we believe that OECD importing regions are likely to see a gradual pickup in their steel industries.

Over the longer term, we believe that higher quality metallurgical coals (such as those produced by our BMA assets) will continue to be required in blast furnace steel-making for decades, driven by the growth of the steel industry in hard coking coal importing countries such as India. In particular, such higher quality coking coals are expected to be valued for their potential to help reduce the GHG emissions intensity of blast furnaces. And with the major seaborne supply region of Queensland having become less conducive to long-life capital investment as a result of changes to the royalty regime, the scarcity value of higher quality coking coals may well increase over time.

Aligned with this longer-term forecast, our strategic objective is to focus on producing higher quality metallurgical coal. In October 2023, we announced that together with Mitsubishi Development Pty Ltd (our 50:50 joint venture partner in BMA) the sale of our Blackwater and Daunia mines to Whitehaven Coal for up to US$4.1 bn (100%). The sale is expected to complete on 2 April 2024.

In thermal coal, we are seeking the relevant approvals to continue mining at NSWEC beyond the current mining consent that expires at the end of FY26, and proceed with a managed process to cease mining at the asset by the end of FY30.

Metallurgical coal production

Unit cost1,2

Underlying EBITDA

11.3 Mt Down 17%

US$129.00/t Up 29%

US$0.8 bn Down 43%

HY23 13.6 Mt

FY24e 46 - 50 Mt (100% basis)

HY23 US$100.23/t

FY24e US$110 - US$116/t

HY23 US$1.4 bn

1 Based on average exchange rates of: HY24 AUD/USD 0.65 (realised); HY23 AUD/USD 0.67 (realised); FY24e AUD/USD 0.67 (guidance).

2 Refer to Non-IFRS financial information for detailed unit cost reconciliation.

Underlying EBITDA decreased by 43% predominately driven by:

· Lower sales volumes in line with lower production volumes, which had an unfavourable impact of US$0.4 bn; and

· Higher costs as a result of the increase in prime stripping to recover depleted inventory positions following extended weather impacts and labour constraints in prior periods, the impacts of inflation, and planned higher maintenance activity, which were partially offset by lower diesel prices.

Queensland remains one of the highest royalty jurisdictions in the world. The change to the royalty regime in CY22 increased coal royalties to the highest maximum rate in the world, and resulted in an additional US$0.3 bn in royalties paid to the Queensland Government by BHP in relation to HY24 than would have otherwise been paid. Combined with income taxes, this equates to an adjusted effective tax rate including royalties of 62%.

We are focused on improving value chain stability following depleted inventory positions arising from extended weather impacts and labour constraints over recent years, and we expect this will continue into CY25.

Following the planned sale of the Blackwater and Daunia mines, we expect 86% of BMA's products will be sold by reference to the Platts PLV HCC FOB Qld index, the highest quality metallurgical coal index, increasing from 64% currently. BMA is also expected to benefit from simplified operations and transport logistics, including the sale and shipment of all products through the 100% owned Hay Point Coal Terminal. After the completion of the sale, we will no longer recognise the closure and rehabilitation provisions for the two sold mines of US$0.6 bn.

Given the negative impact on investment economics resulting from the change in coal royalty rates, and the increase in sovereign risk due to the decision to raise royalties without consultation, we will not be investing in any further growth in Queensland, however we will sustain and optimise our existing operations.

Energy coal production

Underlying EBITDA

7.5 Mt Up 36%

US$0.2 bn Down 84%

HY23 5.5 Mt

FY24e 13 - 15 Mt

HY23 US$1.2 bn

Despite higher sales volumes in line with strong production, Underlying EBITDA decreased by 84%, primarily due to lower average realised prices for thermal coal of 65% which had an unfavourable impact of US$1.7 bn.

The additional volumes resulted in higher operating costs, however these were more than offset by lower royalties (linked to lower prices).

As announced in June 2022, we made the decision to retain NSWEC in our portfolio and proceed with a managed process to cease mining by the end of FY30.

We submitted a modification request to the NSW Government to extend mining approval to 30 June 2030 in support of the 2030 closure plan. The modification submission went on public exhibition for four weeks in November 2023. The approval process will continue through FY24 alongside continued stakeholder and community engagement on closure plans.

Subject to receiving the necessary approvals, as we look ahead to 2030 we will not be allocating any growth capital to NSWEC. We will continue to optimise the operation for value, with absolute costs expected to be stable in the medium term after a period of higher inflation and input prices. The royalty rates in NSW will rise from 8.2% to 10.8% for open cut mines, effective from 1 July 2024.

Production

40 kt Up 4%

HY23 38 kt

FY24e 77 - 87 kt

Average realised pricexi

US$18,602/t Down 24%

HY23 US$24,362/t

Underlying EBITDA

US$(0.2) bn Down 276%

HY23 US$0.1 bn

Capital and exploration expenditure

US$0.8 bn

HY23 US$0.3 bn

FY24e US$1.4 bn

The nickel industry moved into significant surplus over the course of CY23 as Indonesian supply continued to grow at pace at a time of weak traditional end use demand in the OECD, and mixed outcomes across the electric vehicle value chain versus expectations. Indonesian production of Class-II nickel products is up around 3.6 times since CY19, and its production of intermediates has increased dramatically in the last two years. Whilst electric vehicle and battery demand grew across CY23, a significant destocking cycle in the battery value-chain impacted nickel and all battery metals. The conversion of Indonesian-origin nickel products into cathode, which the London Metal Exchange (LME) chose to allow onto its platforms, saw the significant non-Class-I surplus spill over into visible Class-I inventory, and then LME pricing. LME prices had fallen deep into the cost curve by the end of CY23. Whilst voluntary curtailments have been publicly announced by various operators, we estimate that we are in a multi-year run of surpluses that are likely to average out well over 5% of annual demand.

Longer term, we continue to believe nickel will be a core beneficiary of the electrification mega-trend and that nickel sulphides will be particularly attractive. Notwithstanding that, the industry is expected to experience a difficult multi-year run as excess current and committed supply is gradually absorbed by rising demand. Among the many cases we consider for this timing, our base case is that the market may rebalance by the late 2020s.

During HY24 we integrated the West Musgrave project with the Nickel West operations to create the Western Australia Nickel business unit. As the West Musgrave project is still in execution and is not yet operational, its financial impact for the period is seen in capital and exploration expenditure.

Despite higher production volumes at Nickel West, Underlying EBITDA decreased by US$0.3 bn, to a loss of US$(0.2) bn, predominantly as a result of:

· Significantly lower realised prices for nickel metal and intermediate products, which had an unfavourable impact of US$0.3 bn; and

· The unfavourable impact of inflation on the cost base including increased labour and contractor costs.

Nickel West also had increased deliveries of third party concentrate and ore, however the lower nickel prices in the period largely offset the impact of these volumes.

Due to the deterioration in the short-term and medium-term outlook for nickel, BHP has lowered its nickel price assumptions. In addition, capital costs for Western Australia Nickel have increased due to inflation. With regard to these factors, we have recognised an impairment of US$2.5 bn (post tax) against the carrying value of Western Australia Nickel. For further details please refer to note 2 - Exceptional items.

In the context of the above, we are assessing our plans for Western Australia Nickel. These include optimising operations, reducing discretionary expenditure and reviewing capital plans. We are also looking at the longer-term future of Western Australia Nickel, including potentially entering a period of care and maintenance at Nickel West, and assessing phasing and capital spend for the development of the West Musgrave project.

Capital expenditure

US$0.53 bn Up 64%

HY23 US$0.33 bn

FY24e US$1.2 bn

Underlying EBITDA

US$(0.13) bn

HY23 US$(0.09) bn

Potash prices declined across CY23 as prices reverted to more normal ranges with both demand and supply adjusting following the major supply related shocks of the last few years. The existing operations in Russia and Belarus are now back to around four-fifths of pre-shock capacity and global shipments are tracking at 93% of CY20 levels.

In the medium-term we expect existing capacity in Russia and Belarus to return to normal operating rates. However, new projects in the region are expected to face significant delays versus pre-sanctions timelines. Longer term, we believe that potash stands to benefit from the intersection of global mega-trends: rising populations, changing diets and the need for the more sustainable intensification of agriculture on finite arable land. We consider this compelling demand picture, rising geopolitical uncertainty and the maturity of the existing asset base to be an attractive, accelerated entry opportunity in a lower-risk supply jurisdiction such as Saskatchewan, Canada.

In October 2023 we announced an investment of US$4.9 bn for stage 2 of the Jansen potash project, which will increase our total planned potash production capacity to ~8.5 Mtpa (representing approximately 10% of forecast FY30 supply). Transitioning directly from Jansen Stage 1 (JS1) to Jansen Stage 2 (JS2) during the construction period brings a number of operational benefits including leveraging the experience of our integrated project team and continued use of our existing suppliers and contractors. This will allow us to realise potential synergies of ~US$300 m, which are embedded in JS2's economics.

Jansen Stage 1

Progress

Production target date

Investment estimate

38%

End-CY26

US$5.7 bn

JS1 is now 38% complete and on track to deliver first production at the end of CY26, with a two year ramp up period. In HY24, earthworks at JS1 continued, with the concrete foundations for the mill nearing completion. In H2 FY24, we expect to award all remaining major equipment and construction packages for JS1 and will continue to progress underground mine construction activities.

Construction of JS2 is expected to commence in Q4 FY24 and to take approximately six years, with first production expected in FY29, followed by a three year ramp up period. JS2 will have a capital intensity of US$1,050/txii, which is lower than JS1, due to leveraging existing and planned infrastructure. At third party consensus prices, the project is expected to generate an IRR of 15-18%, and EBITDA margins of 65-70%.

Capital expenditure in HY24 for JS1 and JS2 was US$0.53 bn and we remain on track to spend US$1.2 bn for the full year.

The US$0.13 bn of operating costs incurred at Jansen relate to site services, overheads, studies and social investments, which are expected to continue throughout the project.

Exploration expenditure

US$199 m Up 28%

HY23 US$156 m

As well as the successes seen in Copper South Australia, we continued to build our portfolio of options in future facing commodities via high potential exploration projects, equity investments, joint ventures and farm-in agreements. Greenfield minerals exploration was also undertaken to advance copper targets in Sweden, Chile, Serbia, Peru, Canada, Australia and the United States.

We have announced the second cohort of our accelerator program, Xplor. After reviewing several hundred applications, six early-stage minerals exploration companies were selected to join the program. They will each receive funding of up to US$500,000 and will have access to internal and external industry experts to support their growth. Additionally, several companies were selected from the first Xplor cohort for follow on investments, after successfully completing last year's program.

We closed the acquisition of Ragnar Metals' Swedish projects, which included the Tullsta nickel sulphide project. Early drilling results at the project have demonstrated several significant intercepts. Elsewhere, we continue to progress nickel exploration activities in Australia and Canada. We also continued to progress our strategy of partnering with mining companies focused on early-stage copper and nickel exploration projects.

In H2, we intend to pilot exploration trials using generative artificial intelligence. This work extends from a successful proof of concept of the technology in HY24 which achieved early success in retrieving information from large, unstructured government datasets.

Financial Report for the half year ended 31 December 2023

Revenue

27,232

25,713

6%

Profit from operations

4,803

10,833

(56%)

Attributable profit

927

6,457

(86%)

Basic earnings per share (cents)

18.3

127.5

(86%)

Interim dividend per share (cents)

72

90

(20%)

Net operating cash flow

8,884

6,770

31%

Capital and exploration expenditure

4,744

3,027

57%

Net debt

12,648

6,910

83%

Underlying EBITDA

13,875

13,230

5%

Underlying attributable profit

6,569

6,597

(0%)

Underlying basic earnings per ordinary share (cents)

129.6

130.3

(1%)

Copper

Escondida

4,427

2,347

1,897

12,737

853

Pampa Norte5

1,133

408

199

4,740

392

Antamina6

730

469

364

1,454

258

Copper South Australia7

1,853

591

232

16,061

581

Other6

22

(107)

(141)

322

68

Total Copper from Group production

8,165

3,708

2,551

?

35,314

2,152

Third party products

1,223

28

28

?

?

?

Total Copper

9,388

3,736

2,579

?

35,314

2,152

89

89

Adjustment for equity accounted investments6

(730)

(263)

(141)

?

?

(258)

(1)

(1)

Total Copper statutory result

8,658

3,473

2,438

?

35,314

1,894

88

88

Iron Ore

Western Australia Iron Ore

13,991

9,646

8,679

20,937

927

Samarco8

?

?

?

(6,272)

?

Other

59

21

9

(127)

?

Total Iron Ore from Group production

14,050

9,667

8,688

(2,899)

14,538

927

Third party products

12

(1)

(1)

?

?

?

Total Iron Ore

14,062

9,666

8,687

(2,899)

14,538

927

44

22

Adjustment for equity accounted investments

?

?

?

?

?

?

?

?

Total Iron Ore statutory result

14,062

9,666

8,687

(2,899)

14,538

927

44

22

Coal

BHP Mitsubishi Alliance9

2,882

810

529

6,863

303

New South Wales Energy Coal10

980

257

216

(144)

43

Other

?

(31)

(44)

(27)

6

Total Coal from Group production

3,862

1,036

701

?

6,692

352

Third party products

?

?

?

?

?

?

Total Coal

3,862

1,036

701

?

6,692

352

7

2

Adjustment for equity accounted investments10

(76)

(61)

(49)

?

?

?

?

?

Total Coal statutory result

3,786

975

652

?

6,692

352

7

2

Group and unallocated items

Potash

?

(129)

(130)

5,247

533

1

1

Western Australia Nickel11

725

(174)

(240)

(311)

780

27

25

Other12

1

64

(174)

(666)

59

32

32

Total Group and unallocated items

726

(239)

(544)

(3,531)

4,270

1,372

60

58

Inter-segment adjustment

?

?

?

?

?

?

?

?

Total Group

27,232

13,875

11,233

(6,430)

60,814

4,545

199

170

Copper

Escondida

4,089

2,160

1,737

12,103

605

Pampa Norte5

1,094

298

50

4,693

307

Antamina6

752

432

343

1,417

204

Copper South Australia7

1,133

259

62

9,911

270

Other6

1

(99)

(108)

(51)

9

Total Copper from Group production

7,069

3,050

2,084

?

28,073

1,395

Third party products

988

8

8

?

?

?

Total Copper

8,057

3,058

2,092

?

28,073

1,395

64

61

Adjustment for equity accounted investments6

(752)

(244)

(154)

?

?

(204)

(3)

?

Total Copper statutory result

7,305

2,814

1,938

?

28,073

1,191

61

61

Iron Ore

Western Australia Iron Ore

11,756

7,623

6,651

20,669

805

Samarco8

?

?

?

(3,235)

?

Other

57

18

6

(41)

7

Total Iron Ore from Group production

11,813

7,641

6,657

111

17,393

812

Third party products

9

?

?

?

?

?

Total Iron Ore

11,822

7,641

6,657

111

17,393

812

50

26

Adjustment for equity accounted investments

?

?

?

?

?

?

?

?

Total Iron Ore statutory result

11,822

7,641

6,657

111

17,393

812

50

26

Coal

BHP Mitsubishi Alliance9

3,598

1,426

1,125

7,426

183

New South Wales Energy Coal10

2,016

1,288

1,247

(209)

50

Other

?

(29)

(37)

(11)

4

Total Coal from Group production

5,614

2,685

2,335

?

7,206

237

Third party products

?

?

?

?

?

?

Total Coal

5,614

2,685

2,335

?

7,206

237

4

1

Adjustment for equity accounted investments10

(48)

(54)

(41)

?

?

?

?

?

Total Coal statutory result

5,566

2,631

2,294

?

7,206

237

4

1

Group and unallocated items

Potash

?

(87)

(88)

4,008

325

?

?

Western Australia Nickel11

1,010

99

50

1,100

267

26

24

Other12

10

132

(98)

(1,545)

39

15

15

Total Group and unallocated items

1,020

144

(136)

(31)

3,563

631

41

39

Inter-segment adjustment

?

?

?

?

?

?

?

?

Total Group

25,713

13,230

10,753

80

56,235

2,871

156

127

Half year ended 31 December 2022

 13,230

 2,814

 7,641

 2,631

 144

Net price impact

 776

 406

 2,065

 (1,548)

 (147)

Change in sales prices

 629

 411

 2,300

 (1,778)

 (304)

Price-linked costs

 147

 (5)

 (235)

 230

 157

WAIO: Higher royalties in line with higher prices.

NSWEC: Lower royalties in line with lower prices.

Western Australia Nickel: Favourable impact of lower nickel price on third party volumes.

Change in volumes

 260

 164

 10

 68

 18

Escondida: Higher volumes due to higher concentrator feed grade and higher concentrator throughput.

WAIO: Stronger demand in China for portside sales, combined with a favourable product mix at Jimblebar partially offset by continued tie-in activity for the Rail Technology Programme.

NSWEC: Higher volumes reflecting eased labour constraints and improved weather conditions enabling uplift in truck productivity.

Partially offset by:

BMA: Lower volumes due to a significant increase in planned maintenance across the asset, an extended longwall move and geotechnical faulting. This was partially offset by improved weather conditions.

Western Australia Nickel: Higher volumes due to improved performance, and a shorter shutdown period at the Kalgoorlie Smelter offsetting downtime at the Kwinana Refinery.

Change in controllable cash costs

 (436)

 (105)

 17

 (130)

 (218)

Operating cash costs

 (372)

 (52)

 19

 (129)

 (210)

Escondida & Spence: Minor inventory drawdowns.

WAIO: Net favourable inventory movements, largely due to a build in pre-crush stocks, partially offset by increased maintenance activity.

BMA: Higher costs as a result of the increase in stripping to recover depleted inventory positions following extended weather impacts and labour constraints in prior periods.

NSWEC: Higher stripping costs in line with higher volumes.

Western Australia Nickel: Increased deliveries of third party nickel concentrate and ore.

Exploration and business

 (64)

 (53)

 (2)

 (1)

 (8)

development

Copper South Australia: Higher exploration spend for drilling activities at Oak Dam and Olympic Dam.

Change in other costs

 (206)

 (105)

 (42)

 (42)

 (17)

Exchange rates

80

 80

 (15)

 (10)

 25

Inflation

 (507)

 (234)

 (106)

 (107)

 (60)

Global inflation rate of 6.3%

Fuel, energy, and consumable price

 340

 176

 71

 75

 18

movements

Escondida, Spence and Copper South Australia: Primarily due to lower diesel, acid, and electricity prices.

WAIO: Primarily due to lower diesel prices.

BMA & NSWEC: Primarily due to lower diesel prices.

Western Australia Nickel: Primarily due to lower diesel and ammonia prices.

Non-Cash

 (119)

 (127)

 8

 ?

 ?

Escondida: Lower stripping capitalisation reflecting phase of mine plan.

One-off items

?  

 ?

 ?

?

?

Asset sales

 38

?

 1

 (1)

 38

Ceased and sold operations

 (23)

 (23)

 ?

 ?

 ?

Cerro Colorado: Entered temporary care and maintenance in December 2023.

New and acquired operations

 240

 257

 ?

 ?

 (17)

Copper South Australia: Contribution from OZL assets acquired in May 2023.

Other

 (4)

 65

 (26)

 (3)

 (40)

Antamina: Higher profit from higher capitalised stripping reflecting phase of mine plan.

G&U: Prior period fair value gain on OZL holdings, partially offset by HY24 VAT refund received in relation to previously divested Petroleum operations.

Half year ended 31 December 2023

 13,875

 3,473

 9,666

975

 (239)

Average

Average

Half year ended

Half year ended

As at

As at

As at

31 December

31 December

31 December

31 December

30 June

2023

2022

2023

2022

2023

Australian dollar1

0.65

0.67

0.68

0.68

0.66

Chilean peso

874

920

877

860

803

FY24e

HY24

HY23

FY23

Maintenance and decarbonisation1

3.1

1,350

1,128

2,981

Development - Minerals

6.5

3,195

1,743

3,752

Capital expenditure (purchases of property, plant and equipment)

9.6

4,545

2,871

6,733

Add: exploration expenditure

0.4

199

156

350

Capital and exploration expenditure

~10

4,744

3,027

7,083

Potash

Jansen Stage 1

(Canada)100%

Design, engineering and construction of an underground potash mine and surface infrastructure, with capacity to produce 4.15 Mtpa.

5,723

End-CY26

Project is 38% complete

Potash

Jansen Stage 2

(Canada)100%

Development of additional mining districts, completion of the second shaft hoist infrastructure, expansion of processing facilities and addition of rail cars to facilitate production of an incremental 4.36 Mtpa.

4,859

FY29

Approval announced October 2023.

Copper (kt)

1,720 - 1,910

894.4

834.4

7%

Escondida (kt)

1,200 - 1,3001

1,080 - 1,180

Unchanged

527.9

510.7

3%

Pampa Norte (kt)

~2502

210 - 2502

Unchanged

138.1

147.3

(6%)

Copper South Australia (kt)

310 - 340

Unchanged

153.7

104.1

48%

Antamina (kt)

120 - 140

Unchanged

71.7

72.3

(1%)

Carajás (kt)

-

Unchanged

3.0

Iron ore (Mt)

254 - 264.5

129.0

132.0

(2%)

WAIO (Mt)

250 - 260

Unchanged

126.5

129.7

(3%)

WAIO (100% basis) (Mt)

>305

282 - 294

Unchanged

142.1

146.4

(3%)

Samarco (Mt)

4 - 4.5

Unchanged

2.5

2.2

13%

Metallurgical coal - BMA (Mt)

23 - 253

Lowered

11.3

13.6

(17%)

BMA (100% basis) (Mt)

46 - 503

Lowered

22.6

27.2

(17%)

Energy coal - NSWEC (Mt)

13 - 15

Top end

7.5

5.5

36%

Nickel (kt)

77 - 87

Unchanged

39.8

38.4

4%

HY24 at

guidance

realised

HY243

Medium-term

FY24

exchange

exchange

Vs

Escondida unit cost (US$/lb)4,5

1.30 - 1.60

1.40 - 1.70

1.59

1.51

1.44

5%

Spence unit cost (US$/lb)

2.00 - 2.30

2.10

1.98

2.19

-10%

WAIO unit cost (US$/t)6

17.40 - 18.90

18.43

18.46

18.30

1%

BMA unit cost (US$/t)

110 - 116

128.76

129.00

100.23

29%

Target/Goal

Fatalities2

Zero work-related fatalities

0

2

0

High-potential injury (HPI) frequency2

Year-on-year improvement in HPI frequency

0.10

0.18

0.13

Total recordable injury frequency (TRIF)2

Year-on-year improvement in TRIF

4.3

4.4

4.1

Operational greenhouse gas (GHG) emissions(Mt CO2-e)4

Reduce operational GHG emissions by at least 30 per cent from FY20 levels5 by FY30

5.2

9.8

4.9

Value chain emissions: 

Financial value committed in steelmaking partnerships and ventures to date (US$ m)

Steelmaking: 2030 goal to support industry to develop technologies and pathways capable of 30 per cent GHG emissions intensity reduction in integrated steelmaking, with widespread adoption expected post-2030

?

114

?

Value chain emissions:

Reduction6 in emissions intensity of BHP-chartered shipping of our products (%)

Maritime transportation: 2030 goal to support 40 per cent GHG emissions intensity reduction of BHP-chartered shipping of BHP products

43

41

42

Social investment (US$M BHP equity share)

Voluntary social investment aligned to the six pillars of our Social Value Framework

36.1

149.6

41.1

Indigenous procurement spend (US$M)

Purchases from Indigenous vendors target of US$297 million in FY24

289

332.6

141.1

Female employee representation (%)7

Aspirational goal for gender balance8 by the end of FY25

36.29

35.2

33.6

Indigenous employee representation (%)7

Australia10: aim to achieve 9.7 per cent by the end of FY27

8.411

8.6

8.3

Chile12: aim to achieve 10.0 per cent by the end of FY25

10.2

9.7

8.9

Canada13: aim to achieve 20.0 per cent by the end of FY26

9.4

7.7

6.7

Area under nature-positive management practices14 (hectares)

2030 goal of having at least 30 per cent of the land and water we steward15 under conservation, restoration or regenerative practices

-

82,132

-

Media Relations

Email: media.relations@bhp.com

Investor Relations

Email: investor.relations@bhp.com

Australia and Asia

Gabrielle Notley

Tel: +61 3 9609 3830 Mobile: +61 411 071 715

Europe, Middle East and Africa

Neil Burrows

Tel: +44 20 7802 7484 Mobile: +44 7786 661 683

Americas

Renata Fernandez

Mobile: +56 9 8229 5357

Australia and Asia

John-Paul Santamaria

Mobile: +61 499 006 018

Europe, Middle East and Africa

James Bell

Tel: +44 20 7802 7144 Mobile: +44 7961 636 432

Americas

Monica Nettleton

Mobile: +1 416 518 6293

BHP Group Limited ABN 49 004 028 077

LEI WZE1WSENV6JSZFK0JC28

Registered in Australia

Registered Office: Level 18, 171 Collins Street

Melbourne Victoria 3000 Australia

Tel +61 1300 55 4757 Fax +61 3 9609 3015

BHP Group is headquartered in Australia

Follow us on social media

Notes

Half year

ended

31 Dec

2023

US$M

Half year

ended

31 Dec

2022

US$M

Year

ended

30 June

2023

US$M

Revenue

27,232

25,713

53,817

Other income

261

269

394

Expenses excluding net finance costs

(19,982)

(15,429)

(31,873)

(Loss)/profit from equity accounted investments, related impairments and expenses

3

(2,708)

280

594

Profit from operations

4,803

10,833

22,932

Financial expenses

(1,164)

(863)

(2,060)

Financial income

343

211

529

Net finance costs

4

(821)

(652)

(1,531)

Profit before taxation

3,982

10,181

21,401

Income tax expense

(2,215)

(3,038)

(6,691)

Royalty-related taxation (net of income tax benefit)

(61)

(17)

(386)

Total taxation expense

5

(2,276)

(3,055)

(7,077)

Profit after taxation

1,706

7,126

14,324

Attributable to non-controlling interests

779

669

1,403

Attributable to BHP shareholders

927

6,457

12,921

Basic earnings per ordinary share (cents)

6

18.3

127.5

255.2

Diluted earnings per ordinary share (cents)

6

18.3

127.3

254.7

Half year

ended

31 Dec

2023

US$M

Half year

ended

31 Dec

2022

US$M

Year

ended

30 June

2023

US$M

Profit after taxation

1,706

7,126

14,324

Other comprehensive income

Items that may be reclassified subsequently to the income statement:

Hedges:

Gains/(losses) taken to equity

114

100

95

(Gains)/losses transferred to the income statement

(92)

(125)

(148)

Loss transferred to initial carrying amount of hedged item

 ?

 ?

35

Tax recognised within other comprehensive income

(7)

8

5

Total items that may be reclassified subsequently to the income statement

15

(17)

(13)

Items that will not be reclassified to the income statement:

Re-measurement gains/(losses) on pension and medical schemes

2

6

(18)

Equity investments held at fair value

(47)

(7)

17

Tax recognised within other comprehensive income

 ?

 ?

7

Total items that will not be reclassified to the income statement

(45)

(1)

6

Total other comprehensive (loss)/income

(30)

(18)

(7)

Total comprehensive income

1,676

7,108

14,317

Attributable to non-controlling interests

779

669

1,400

Attributable to BHP shareholders

897

6,439

12,917

31 Dec 2023

US$M

30 June 2023

US$M

ASSETS

Current assets

Cash and cash equivalents

10,319

12,428

Trade and other receivables

5,352

4,594

Other financial assets

607

470

Inventories

5,313

5,220

Assets held for sale

11

1,570

 ?

Current tax assets

446

508

Other

193

131

Total current assets

23,800

23,351

Non-current assets

Trade and other receivables

169

148

Other financial assets

1,050

1,115

Inventories

1,426

1,403

Property, plant and equipment

69,994

71,818

Intangible assets

1,615

1,610

Investments accounted for using the equity method

1,618

1,620

Deferred tax assets

76

56

Other

240

175

Total non-current assets

76,188

77,945

Total assets