BHP announces 2017 financial Results

BHP released its full year results on 22 August 2017:

  • Tragically, we had a fatality at Escondida in October 2016, and more recently at Goonyella Riverside.
  • Attributable profit of US$5.9 billion, Underlying EBITDA(ii) of US$20.3 billion, Underlying EBITDA margin(iii) of 55% and Underlying return on capital employed(iii) of 10% (after tax) for the 2017 financial year.
  • Productivity gains(iv) of US$1.3 billion achieved for the period, with more than US$12 billion accumulated over the last five years. We expect to deliver a further US$2 billion by the end of the 2019 financial year, with gains weighted to the second year.
  • Net operating cash flow of US$16.8 billion and free cash flow(i) of US$12.6 billion were underpinned by higher commodity prices, strong operating performance and improved capital productivity.
  • Capital and exploration expenditure(v) reduced by 32% to US$5.2 billion, as we focused on capital efficient latent capacity projects and exercised flexibility in our Onshore US plans.
  • Capital and exploration expenditure is expected to increase to US$6.9 billion in the 2018 financial year as we focus on our suite of low-risk, high-return latent capacity projects, progress Mad Dog Phase 2 and the Spence Growth Option and ramp-up drilling activity in Onshore US.
  • In accordance with our capital allocation framework, we expect capital and exploration expenditure to remain below US$8 billion per annum for the 2019 and 2020 financial years.
  • We strengthened our balance sheet, with net debt(i) of US$16.3 billion reflecting strong free cash flow generation and a favourable non-cash movement in net debt of US$0.6 billion.
  • The Board has determined to pay a final dividend of 43 US cents per share which is covered by free cash flow generated in the current period. Total dividends of US$4.4 billion determined for the 2017 financial year include US$1.1 billion in additional amounts over and above the 50% minimum payout policy.
  • In Petroleum, positive drilling results were reported following the discovery of oil in multiple horizons at the Wildling-2 appraisal well in the Gulf of Mexico this month.
  • We have determined that our Onshore US assets are non-core and we are actively pursuing options to exit these assets for value. In the meantime, we will complete well trials, acreage swaps and assess midstream solutions to increase the value, profitability and marketability of our acreage.
  • In Brazil, progress continues on the social and environmental remediation programs following the Samarco dam failure.

Read the full 2017 fincancial results: here

Source: BHP

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