BHP operational review for the year ended 30 June 2023

Company News

by Peter Milios

BHP (ASX:BHP) has released its operational review for the financial year ended 30 June 2023. The review highlights the company's production achievements, financial performance, portfolio developments, and commitment to safety and sustainability. This article provides a factual overview of the key points presented in the operational review.

Production Achievements

During the financial year, BHP achieved its full-year production guidance for copper, iron ore, metallurgical coal, and energy coal. Nickel production met revised guidance, falling within the lower end of the original guidance. Some notable production records were set at key operations:
  1. Western Australia Iron Ore (WAIO) achieved a record production of 285 million metric tonnes (100% basis).
  2. Spence recorded a production of 240 thousand metric tonnes.
  3. Olympic Dam achieved annual production records for copper (212 thousand metric tonnes) and refined gold (186 troy thousand ounces).
Safety Commitment

Tragically, two fatalities occurred during the financial year. BHP expressed its commitment to sharing the learnings from these events and remains resolute in its commitment to eliminating fatalities and serious injuries within the organisation. The company emphasised the importance of safety in its operations and its determination to continuously improve safety measures.

Financial Performance

BHP faced various challenges in the financial year, including lower average realised prices for copper, iron ore, and metallurgical coal products compared to the previous year. Nickel prices remained stable, while thermal coal prices strengthened, particularly in the first half of the financial year. Inflationary pressures also impacted the company's business operations.

Portfolio Developments

BHP completed the acquisition of OZ Minerals Ltd on 2 May 2023, strengthening its portfolio in copper, nickel, and uranium. The company also made strategic investments and progressed exploration activities in copper and nickel prospects globally, including Kabanga in Tanzania, Oak Dam in Australia, Filo Mining in Argentina and Chile, and Ocelot in the United States, Serbia, and Peru.

Sustainability and Decarbonisation

BHP released its sixth Reconciliation Action Plan, which was awarded Elevate status. The plan includes commitments to increase Indigenous representation in the Australian workforce and achieve a significant spend with Traditional Owner and Indigenous businesses.

Additionally, BHP provided updates on its progress and plans for operational decarbonisation. The company outlined its medium and long-term decarbonisation targets and goals, emphasising its focus on future-facing commodities and its Jansen potash project in Canada.

Peter Milios

Peter Milios is a recent graduate from the University of Technology - majoring in Finance and Accounting. Peter is currently working under equity research analyst Di Brookman for Corporate Connect Research.

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