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Overview

A strong set of results, reflecting the strength, resilience and quality of our people and portfolio. In a year marked by the challenges of the global COVID-19 pandemic, social unrest in Chile and commodity price volatility, we were safer, more reliable and lower cost.

Ken

“BHP’s relentless focus on our five priority areas – safety; portfolio; capital discipline; culture and capability; and social value – has enabled us to meet the global challenges of the crisis from a position of strength and to deliver a strong set of financial results in FY2020.”

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“We have structured our business to thrive through changing times, and we are set up well to deal with near-term market uncertainty and to prosper as the world returns to its trajectory of long-term growth.”

Read our Chief Executive Officer's Report

At a glance

BHP has been around for 135 years

We employ over 80,000 employees and contractors

We work in over 90 locations worldwide

We paid US$9.1 billion globally in taxes, royalties and other payments

Our total direct economic contribution was US$37.2 billion

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Sustainability Reporting 2020

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Economic Contribution Report 2020

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Climate Change Report 2020

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FY2020 financial results

Our results reflect the strength, resilience and quality of our people and our portfolio. We reduced our unit costs at all of our major operated assets and realised production or throughput records in a number of operations.

 

BHP delivered a strong set of results, safely achieved in the face of some significant challenges in our markets and in our operating regions. Our results were underpinned by our high-quality portfolio, great people with a culture focused on financial discipline, operational excellence and our contribution to social value.  

We achieved an Attributable profit of US$8.0 billion, broadly in line with the prior year. Our operations generated robust free cash flow of US$8.1 billion, we invested US$7.6 billion in our assets, and our balance sheet remained strong, with net debt finishing at the low end of our target range.  

On average, we lowered our unit production costs by 9 per cent across our major assets due to foreign exchange rates, better productivity and improved operating stability, including 11 per cent unit cost reductions at Escondida and WAIO. We achieved record production at WAIO, Caval Ridge and Poitrel; record coal mined at Broadmeadow and record average concentrator throughput at Escondida. 

Our basic earnings per share was 2 per cent lower at 157.3 US cents per share, while our underlying return on capital employed was a strong 17 per cent. We announced a final dividend of US$0.55 per share, taking the total dividend for the year to US$1.20 per share, a return of US$6.1 billion to shareholders, the third year in a row we have returned over US$6 billion.  

More on our financial results or our sustainability performance.

financial performance

Annual Report

Underlying attributable profit of US$9.1 billion 1, 3

Annual Report

Underlying EBITDA of US$22.1 billion at a margin of 53 per cent 2, 3

Net operating cash flows of US$8.1 billion 1

Declared a total dividend of US$1.20 a share

Underlying return on capital employed of a strong 16.9% 1, 3

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Sustainability Reporting 2020

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Economic Contribution Report 2020

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Climate Change Report 2020

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Productivity

Strong cost discipline and records for equipment utilisation, milling and production helped reduce unit costs by 9 per cent across our major assets.

Cost efficiencies: Continuing to drive higher performance 

Our strong cost performance was underpinned by consumption efficiencies at Escondida, improved operating stability across our portfolio and further reductions in overheads. These gains more than offset increased planned maintenance activities at some assets.  

We will continue to drive higher performance as we unlock value through the ongoing automation of our supply chain, reduce our reliance on labour hire through the continued roll out in Australia of our Operations Services initiative to leverage best practice in production and maintenance, and continue to set records for equipment utilisation, milling and production across our operations. 

Latent capacity: Attractive returns, limited risk 

Our latent capacity program allows us to achieve more production or replace production from our existing infrastructure with minimal risk. Our key latent capacity projects were completed or tracked to plan in FY2020: 

  • Escondida Water Supply Expansion project was completed in December 2019, on schedule and budget, further increasing total desalinated water capacity to 3,800 litres per second. Escondida has invested more than US$4 billion in desalinated water since 2006. This project enabled us to eliminate the extraction of groundwater for operational supply purposes at Escondida in FY2020, 10 years ahead of schedule.
  • West Barracouta (Bass Strait) project is on schedule and budget and is still expected to achieve first production in the 2021 calendar year, despite delays in component delivery and equipment fabrication due to COVID-19 restrictions. 
  • WAIO is working to sustainably achieve supply chain capacity of 290 Mtpa over the medium-term. 

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productivity

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Sustainability Reporting 2020

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Economic Contribution Report 2020

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Climate Change Report 2020

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Future options

Major development projects in petroleum, copper, iron ore and potash are tracking well.

Project pipeline 

At the end of FY2020, BHP had six major projects under development, with a combined budget of US$11.4 billion over the life of the projects. First production from Atlantis Phase 3 was achieved in July 2020, with the Spence Growth Option and South Flank expected to deliver first production within the next 12 months. 

The Spence Growth Option is continuing to progress. However, because of measures put in place to reduce the spread of COVID-19, first production is now expected between December 2020 and March 2021.  

The Jansen Stage 1 potash project in Canada is now expected to be presented to the BHP Board for Final Investment Decision in the middle of CY2021 following delays to the completion of the shafts. These delays were a result of initial challenges with placement of the shaft lining, since rectified, and impacts from our COVID-19 response plan. The forecast capital cost for the execution of Jansen Stage 1 is unchanged at between US$5.3 billion to US$5.7 billion.   

Exploration: focused on petroleum, copper and nickel  

We continue to advance our exploration programs in petroleum, copper and nickel, with results of the third phase of the drilling program completed at our Oak Dam copper discovery in South Australia currently under analysis. We have also added to our early stage optionality in nickel with the acquisition of the Honeymoon Well tenements in Western Australia.   

We spent US$740 million on exploration in FY2020, and anticipate similar expenditure in FY2021, including approximately US$450 million for petroleum exploration and appraisal expenditure. 

Read more about exploration

exploration

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Sustainability Reporting 2020

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Economic Contribution Report 2020

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Climate Change Report 2020

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Inclusion and diversity

We believe our people should have the opportunity to fulfil their potential and thrive in an inclusive and diverse workplace. Inclusion and diversity promotes safety, productivity and wellbeing and underpins our ability to attract new employees.

Gender balance1 

We have an aspirational goal to achieve gender balance globally by CY2025. In FY2020, we increased the representation of women working at BHP from 24.5 per cent to 26.5 per cent. There were 1767 more women working at BHP than at the start of the financial year and we have almost 4,000 more women working at BHP that when we set our aspirational goal four years ago.

Respectful Behaviours campaign

In FY2020 we began a Group-wide Respectful Behaviours campaign to create greater awareness and build understanding of what disrespectful behaviour is and how it affects our people. We shared real-life examples from within BHP to highlight the initiative and generate conversations. Further development of a ‘culture of care’ within our business is a fundamental element of our FY2020 business plan. 

Flexible working  

Flexible work supports the diversity and wellness of our workforce. We further implemented our flexible work principles during the COVID-19 crisis by encouraging and supporting flexible work in different ways, like new rosters, shifts for people in office buildings and working from home offices (for people from our functions and also our operations if they were at risk). COVID-19 has rapidly challenged the mindset on work flexibility.  

Indigenous employment 

We aim to provide employment opportunities in the communities in which we operate that contribute to sustainable social and economic benefits for Indigenous peoples. 

In Minerals Australia, Indigenous employment within our employee and contractor workforce2 increased from 5 per cent to 6.5 per cent (1,726 employees and 475 contractors) in FY2020, exceeding our target of 5.75 per cent.  

In North America, we have focused on working with our contracting partners to support the employment of First Nations and Métis peoples, who now comprise 22 per cent of our workforce at the Jansen Potash project. Our total workforce in North America comprises 15 per cent Indigenous people.  

In Chile, representation of Indigenous workers at our operations rose to 6.6 per cent in FY2020 (from 5.9 per cent in FY2019). 

Read more about our people

Footnote:

1 Based on a ‘point in time’ snapshot of employees as at 30 June 2020, as used in internal management reporting for the purposes of monitoring progress against our goals. This does not include contractors. This methodology differs from the data reported in section 1.6.2 of the BHP Annual Report 2020, which is calculated based on the average of the number of employees at the last day of each calendar month for a 10-month period from July through to April and in accordance with our reporting requirement under the UK Companies Act 2006.

2 Based on a ‘point in time’ snapshot of employees and labour hire contractors as at 30 June 2020.

inclusion and diversity

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Sustainability Reporting 2020

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Economic Contribution Report 2020

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Climate Change Report 2020

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