BHP trims dividend to lowest number since 2017 and flags reduced spend on building new mines after 2027

West Australian

3 days ago

Getting rid of its nickel pain plus record iron ore and copper output has boosted BHP's profit to $US9 billion ($13.9b), yet shareholder dividends have shrunk to their lowest in eight years.
BHP's headline financial year profit figure was healthier, but cash flow dried up on the back of weaker commodity prices plus the company's splurge on a huge potash project in Canada and new copper assets in South America.
The Big Australian recorded a 14 per cent profit rise for the 2025 financial year after making $US5.7b of asset write-downs during the 2024 financial year — mainly related to the suspension of WA Nickel, which it has now put up for sale.
The ongoing legal fallout from the 2015 Samarco Dam failure in Brazil also weighed on BHP's accounts for the 2024 financial year.
Underlying earnings were down 10 per cent to US$26b as revenue fell 8 per cent to $US51.3b. Free cash flow fell 55 per cent to US$5.3b and net debt jumped from US9.1b to $US12.9b.
On average, BHP made 19 per cent less for a tonne of iron ore sold and steel-making coal sale prices slumped by 27 per cent. Copper prices rose 4 per cent.
BHP declared a final dividend of US60¢, taking the total fully-franked investor payout for the financial year to $US1.10, which was higher than analysts had predicted but BHP's lowest figure since 2017.
The total dividend payout for the 2024 financial year was $US1.46.
BHP chief executive Mike Henry said the company had produced 'another strong year', pointing to record production results.
'We met full-year production guidance across all assets, and set new records in copper and iron ore,' he said.
'Copper production exceeded 2 million tonnes for the first time, up 28 per cent over the past three years. We maintained our position as the world's lowest-cost major iron ore producer at Western Australian Iron Ore where we delivered 290Mt — a new production record.'
Mr Henry flagged a reduction in spending on new mines once the Jansen potash project in Canada comes online.
First potash is slated for the middle of next year.
Building the first stage of Jansen originally had a $US5.7 billion ($8.8b) price tag, but last month BHP said the expected spend has risen to between $US7b and $US7.4b ($11.4b).
'In each of the next two years we expect to spend US$11b in capital and exploration, reducing to US$10n on average each year between FY2028 and FY2030,' Mr Henry said on Tuesday.
The BHP chief, who is rumoured to be stepping down from the top job next year, said the global economic outlook was 'mixed'.
'Growth is expected to ease to 3 per cent or slightly below in the near-term amid shifting trade policies, yet demand for commodities remains strong, particularly in China and India,' he said.
'Chinese copper demand outperformed in FY2025, while iron ore demand was resilient, driven by strong infrastructure investment and manufacturing activity in China.
'Steelmaking coal prices have softened due to oversupply, though policy shifts in China and new blast furnace capacity in Asia are expected to support the market.
'Potash markets are expected to continue to benefit from a growing and wealthier population and the need for more sustainable agriculture. We remain confident in the long-term fundamentals of steelmaking materials, copper and fertilisers, which are critical to global growth, urbanisation and the energy transition.'