FY2021 financial results

BHP delivered excellent financial results in FY2021, supported by strong operational performance, disciplined capital investment and our Marketing team’s ability to negotiate competitive commercial terms for our products.

Our operational performance, when combined with higher iron ore and copper prices, drove underlying EBITDA up 69 per cent to US$37.4 billion – at a margin of 64 per cent. Underlying attributable profit increased by 88 per cent to US$17.1 billion. 

The total shareholder dividend for FY2021 was a record 301 US cents per share. This represents an 89 per cent payout ratio.

Our total direct economic contribution for FY2021 was US$40.9 billion. This includes payments to suppliers, wages and benefits for our 80,000 employees and contractors, dividends, taxes and royalties, and voluntary investment in social projects across the communities where we operate. 

In FY2021, our tax, royalty and other payments to governments totalled US$11.1 billion. Of this, 84.7 per cent or US$9.4 billion was paid in Australia. Our global adjusted effective tax rate in FY2021 was 34.1 per cent, which is broadly in line with our average adjusted effective tax rate over the past decade of 33.4 per cent.

Once royalties are included, our FY2021 rate increases to 40.7 per cent. 

We have continued to apply the Capital Allocation Framework to direct cash where it can generate the best returns. Over the year, Underlying Return on Capital Employed strengthened to 32.5 per cent.

Performance and value

BHP delivered strong operational performance across our assets in FY2021, and we continue to pursue operational excellence.

We are also committed to creating long-term value for our shareholders and consider social value and financial value in the decisions we make.

Operational performance

We achieved record production at Western Australia Iron Ore, Olympic Dam and in our Goonyella mine in Queensland, and maintained average concentrator throughput at record levels at Escondida. Unit costs were lower across our major assets. Our major capital projects in iron ore, copper and petroleum were delivered on time and on budget, despite the challenges of the pandemic.

Importantly, we have continued our focus on safety. Nothing at BHP is more important than keeping people safe, and we remained fatality free for a second consecutive year. Our efforts on this will not cease. 

Social value

Social value is our positive contribution to society – to our people, partners, economy, environment and local communities. We know that when we consider social impacts in our decision-making and when we build respectful and mutually beneficial relationships, we create value for all of our stakeholders and in particular for our shareholders.

We consider our social value work to be successful when the societies where we operate are better off through our presence; the communities we are part of are resilient and thriving, even in the face of change; our shareholders receive a superior return on their investment; and we are a partner of choice for governments, investors, employees, communities, suppliers and customers.

Positioning for the future

We are growing value and positioning our company for the future.

In August 2021, we announced proposed changes to our portfolio and corporate structure to position BHP for the future. These portfolio and capability changes are intended to enable us to even more strongly grow long-term value by sustainably producing the commodities the world needs for continued economic growth and decarbonisation.

With this in mind, we are focusing our portfolio on commodities with the potential to afford long-term value growth at scale. We are investing US$5.7 billion in the Jansen Stage 1 project in Canada. We have announced our intention to create a global international energy company through the pursuit of a merger of BHP’s petroleum business with Woodside. We also continue to make progress on our coal portfolio consolidation, with a focus on higher-quality coal for steelmaking.

Alongside these portfolio changes, we are seeking to make BHP simpler and more agile by unifying the company’s corporate structure to adopt a single company structure under BHP Group Limited with a primary listing on the Australian Securities Exchange.

Exploration: focused on copper and nickel  

Our exploration program is focused on copper and nickel to grow our future-facing resource portfolio and replenish our resource base. It is designed to enable us to generate attractive, low-cost, value-accretive options for our business and to position BHP for the best future access to our preferred resources. 

Our resource assessment exploration expenditure increased by 5 per cent in FY2021 to US$138 million, while our greenfield expenditure increased by 23 per cent to US$54 million.

Inclusion and diversity

An inclusive and diverse workforce 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 FY2021, we increased the representation of women working at BHP by 3.3 percentage points. Overall, women represent 29.8 per cent of our employee workforce including employees on extended absence such as parental leave. At the end of FY2021 we had 5,257 more female employees than reported in 2016.

Indigenous employment

Indigenous peoples are critical partners and stakeholders for many of BHP’s operations around the world.

We have set targets to achieve Indigenous employment of 8 per cent in our Australian workforce by the end of FY2025, 10 per cent in our workforce in Chile by the end of FY2026 and 20 per cent in our Potash workforce in Canada by the end of FY2027.

Indigenous employment within our employee and contractor workforce² as at 30 June 2021 was 7.2 per cent in Australia, 7.5 per cent at our operations in Chile and 13.7 per cent at our Jansen Potash Project in Canada.

LGBT+ inclusion

Our LGBT+ ally employee inclusion group, Jasper, was established in 2017 as a natural extension of our inclusion and diversity aspirations and to reflect Our Charter value of respect. The membership base of LGBT+ employees and allies has grown substantially with eight regional chapters globally.

In February 2021, we launched our Gender Affirmation Policy and leader toolkit outlining how we will support employees affirming their gender.

Flexible working

Our focus on flexible working over the past few years assisted our office-based workers to adapt to remote working requirements caused by the COVID-19 pandemic.

We expect to maintain a hybrid working model for employees based in corporate offices, depending on the nature of their work.

We also understand many site-based employees are in roles that by their very nature cannot be performed remotely. We will continue to seek to provide flexible working through part-time and job-share arrangements, flexible rosters and career breaks.

Footnotes

¹ Based on a ‘point in time’ snapshot of employees as at 30 June 2021, as used in internal management reporting for the purposes of monitoring progress against our goals. This does not include contractors. For the first time this includes  employees on extended absence (660 at 30 June 2021), who were previously not included in the active headcount.

² Based on a ‘point in time’ snapshot of employees and labour hire contractors as at 30 June 2021.