BHP Delivers Impressive Financial and Operational Results for the Half-Year Ending 31 December 2024
On 18 February 2025, BHP released its half-year results for the period ending 31 December 2024, showcasing a strong financial performance supported by disciplined cost management and sustainable operational strategies. The company demonstrated operational resilience with outstanding production performances at its key mines, including Escondida in Chile, WAIO in Western Australia, and BMA in Queensland, Australia. The company’s industry-leading margins and strong cash flow have reinforced BHP’s ability to navigate challenging market conditions and generate consistent returns for shareholders.
BHP's Chief Executive Officer (CEO), Mike Henry, and Chief Financial Officer (CFO), Vandita Pant, presented the results, providing key insights into the company’s operational highlights, growth investments, and future outlook.
Financial Highlights: Robust Earnings and Strong Cash Flow
The financial performance for the period reflected a solid underlying performance across BHP's diverse portfolio of operations. The company declared an interim dividend of 50 US cents per share, amounting to a total of US$2.5 billion. This marks a significant payout to shareholders, underlining the company’s ability to generate strong earnings while maintaining a 50% payout ratio. The interim dividend also reinforces the company’s commitment to delivering value to shareholders, even amidst global economic uncertainties.
Despite lower commodity prices impacting some areas of BHP’s operations, the company maintained strong operational control, leading to record margins. CEO Mike Henry emphasized, "BHP’s performance reflects our ability to generate superior returns through disciplined capital allocation and cost efficiency, with strong cash flow from our core assets."
Operational Excellence: Strong Production and Record Efficiency
BHP’s operational resilience was evident in its key production assets. Escondida, the world’s largest copper mine, saw an impressive 22% increase in copper production. This significant rise was driven by operational improvements and strong underlying performance at the site. As a result, BHP's total copper equivalent production increased by 5.3% compared to the same period last year.
Meanwhile, Western Australia Iron Ore continued to shine, with the region maintaining its status as the lowest-cost iron ore producer globally. WAIO’s production increased by 1%, reaffirming its leadership in the global iron ore market. Similarly, the BHP Mitsubishi Alliance, which operates large coal mining operations in Australia, achieved a 14% production increase despite the divestment of the Blackwater and Daunia mines. This growth indicates BHP's ability to adapt and scale in response to changing market conditions and asset portfolio adjustments.
The company’s strong commitment to safety was also reflected in its impressive safety performance. BHP's High Potential Injury frequency dropped by ~54% from H2 FY24, with the company achieving zero high-potential injuries in Q2 FY25. These results demonstrate the company’s ongoing focus on fatality elimination and its dedication to ensuring the safety and well-being of its employees.
Growth Investments in Future-Facing Commodities
BHP continues to direct significant investment toward growth opportunities in sectors poised to benefit from long-term global trends. During the half-year, the company invested US$3.2 billion in potash and copper, reinforcing its strategic focus on future-facing commodities. The investment aligns with BHP’s commitment to supporting the global energy transition, where copper and potash are key elements in sustainable energy solutions.
In addition to its organic investments, BHP also completed the formation of Vicuña Corp, a 50/50 joint venture with Lundin Mining valued at US$2.0 billion. Vicuña Corp will oversee the development of the Filo del Sol and Josemaria copper projects in Argentina, two highly prospective assets in a region expected to see growing demand for copper due to its central role in the global transition toward renewable energy, electric vehicles, and infrastructure.
The US$5.2 billion capital and exploration expenditure for the half-year represented a 10% increase compared to the prior year. The company estimates that approximately 65% of this expenditure will be directed toward future-facing commodities, reinforcing BHP’s strategy to focus on products critical to the energy transition, technology, and infrastructure growth.
Financial Summary and Shareholder Value
Attributable profit for the half-year reached US$4.4 billion, a marked improvement compared to US$0.9 billion in the previous period. However, after adjusting for exceptional losses in HY24, the underlying attributable profit saw a 23% decrease. This reflects fluctuations in commodity prices, which impacted revenue in certain segments, but was mitigated by the company’s strong operational and cost-control efforts.
BHP continues to prioritize shareholder returns, with its interim dividend reflecting the company’s healthy cash flow and commitment to returning value to investors. The 50% payout ratio on the interim dividend of US$2.5 billion is a clear indicator of the company’s financial discipline and commitment to rewarding shareholders, even while investing in future growth initiatives.
Tax Contributions and Community Investments
As one of the largest corporate taxpayers in Australia, BHP paid US$3.4 billion in net income tax and royalty-related taxation during the half-year. The company remains committed to its social responsibility and continues to play a significant role in supporting the economies of the countries in which it operates, particularly in Chile and Australia.
In Brazil, BHP made significant progress in its efforts to resolve the tragic consequences of the Samarco dam disaster. The company signed a comprehensive settlement agreement that will deliver expanded programs for environmental restoration and community support. The agreement also brings greater clarity regarding future cash flows tied to the aftermath of the disaster, helping the company provide long-term sustainability to affected communities.
Global Market Conditions and Future Outlook
Despite global economic uncertainties, the demand for BHP’s products remains strong. China’s early signs of recovery, combined with resilient economic growth in the United States and strong growth in India, provide a solid foundation for the company's future performance. The global trajectory toward an increased urban population (growing from 8 billion today to an estimated 10 billion by 2050) and the rise of energy transition technologies, data centers, and artificial intelligence will continue to fuel the demand for metals and minerals.
As a key player in the global mining sector, BHP is well-positioned to leverage its strong balance sheet, technical expertise, and sustainable business practices to capitalize on these global trends. The company is committed to delivering both long-term growth and resilient shareholder returns through its diversified portfolio and strategic investments.
Leadership Transition: Ross McEwan to Succeed Ken MacKenzie as Chair
In addition to the financial and operational updates, BHP also announced that Ken MacKenzie, current Chair of the Board, will retire on 31 March 2025, after a successful tenure in which he helped guide the company through several strategic transformations. MacKenzie’s leadership played a critical role in positioning BHP for future growth, particularly through the focus on cost discipline, operational efficiency, and community engagement.
Ross McEwan will succeed MacKenzie as Chair of the Board, effective 31 March 2025. McEwan, who has been an independent non-executive director since April 2024, brings extensive experience in capital allocation, risk management, and value creation, having previously served as CEO of National Australia Bank and Group CEO of the Royal Bank of Scotland. McEwan’s appointment is seen as a natural progression for the company, and BHP is confident in his ability to lead the Board and continue to drive shareholder value.
Safety and Risk Management: Ongoing Commitment to Worker Safety
BHP has continued its emphasis on safety, with a strong focus on the elimination of fatalities and improving operational risk management across its global operations. The company’s zero tolerance for high-potential injuries and rigorous safety protocols have helped reduce its High Potential Injury (HPI) frequency by 54% from H2 FY24, further reinforcing the company’s commitment to the health and well-being of its employees and contractors.
BHP's half-year results for 2024 underscore the company’s operational resilience, strategic growth initiatives, and commitment to delivering value to shareholders. By investing in future-facing commodities, expanding its global operations, and ensuring sustainable business practices, BHP is well-positioned to capitalize on the growing demand for metals and minerals, driven by global economic trends and technological advancements.
