BHP Group Ltd.

Company Overview

Business Model: BHP Group Limited is the world’s largest mining company by market capitalisation as at 30 June 2025. The company's core value proposition is the extraction and sale of future-facing commodities and higher-quality steelmaking materials. Its portfolio has been reshaped to increase exposure to copper and potash. Primary revenue generation mechanisms include mining and processing copper, iron ore, steelmaking coal, energy coal, uranium, gold, silver, molybdenum, zinc, and lead, operating through wholly-owned assets and joint ventures globally.

Market Position: BHP Group Limited holds the position of the world’s largest mining company by market capitalisation as at 30 June 2025. It has extended its lead as the lowest-cost major iron ore producer globally for the sixth consecutive year. Copper contributed 45% of EBITDA in FY2025. Over the past decade, BHP Group Limited's EBITDA margin averaged 55%, approximately 10 percentage points above its closest major competitor. The Jansen potash project is expected to have operating costs at the low end of the cost curve when fully ramped up.

Recent Strategic Developments: BHP Group Limited has made progress strengthening its pipeline of growth options in copper and potash. Key initiatives include the full SaL leaching project achieving first production in Q4 FY2025 at Escondida and Hydrofloat technology being commissioned in Q4 at Carrapateena. The company formed the Vicuña joint venture with Lundin Mining in January 2025 to develop copper deposits on the Argentina-Chile border. In iron ore, BHP Group Limited approved commissioning of a sixth car dumper (CD6) and related infrastructure at Port Hedland for approximately US$0.9 billion to maintain production above 305 Mtpa (100% basis) from Q4 FY2028. The company is divesting its Carajás assets to CoreX Holding for up to US$465 million, expected to complete early CY2026. Operations at Western Australia Nickel and the West Musgrave project transitioned into temporary suspension at the end of H1 FY2025, with a review expected by February 2027, and BHP Group Limited exited its 17% interest in Kabanga Nickel Limited on 18 July 2025. New South Wales Energy Coal received approval to extend mining activities at Mt Arthur Coal for an additional four years, from July 2026 to June 2030, as part of its planned closure by end of FY2030. In FY2025, BHP Group Limited launched a Technology Strategy to accelerate data, digital solutions, and innovation, and achieved its aspirational goal of gender balance within its global employee workforce by CY2025, with women comprising 41.3%.

Geographic Footprint: BHP Group Limited is incorporated in Victoria, Australia, with its global headquarters in Melbourne. Its primary operational regions include Australia, Chile, Peru, Brazil, Canada, and the United States. Key markets for revenue in FY2025 were China (US$32.083 billion), Japan (US$4.177 billion), India (US$2.661 billion), South Korea (US$2.664 billion), Rest of Asia (US$3.331 billion), Australia (US$2.545 billion), North America (US$2.251 billion), Europe (US$1.121 billion), and South America (US$429 million).

Cross-Border Operations: BHP Group Limited maintains a primary listing on the Australian Securities Exchange, international secondary listing on the London Stock Exchange, secondary listing on the Johannesburg Stock Exchange, and an American Depositary Receipt program on the New York Stock Exchange. The company operates through a network of wholly-owned assets and joint ventures across multiple jurisdictions. Significant international subsidiaries include entities in Singapore, Switzerland, The Netherlands, and Canada, alongside its Australian and Chilean operations. Key joint ventures include Escondida (Chile), Antamina (Peru), Resolution Copper (United States), Vicuña (Argentina/Chile), Samarco (Brazil), and BHP Mitsubishi Alliance (Australia). The company's functional currency is US dollars. Operations are subject to diverse regulatory frameworks covering environmental protection, occupational health and safety, human rights, competition, foreign investment, export, and taxation across these jurisdictions. Australian Foreign Acquisitions and Takeovers Act 1975 conditions require BHP Group Limited to remain an Australian resident company, ASX-listed, with headquarters in Australia, the CEO's principal office and residence in Australia, and a majority of Board meetings in Australia.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 37.9% (FY2025)
• Operating Margin: 39.5% (FY2025)
• Net Margin: 17.6% (FY2025)
• Underlying EBITDA margin: 53% (FY2025)
• Underlying return on capital employed: 20.6% (FY2025)

Investment in Growth:

• R&D Expenditure: $396 million (0.77% of revenue)
• Capital Expenditures: $9,398 million
• Strategic Investments:
  • Jansen Stage 1 capital expenditure revised to US$7.0 billion–US$7.4 billion (from US$5.7 billion).
  • US$200 million approved for Olympic Dam Southern Mine Area underground development.
  • US$0.9 billion approved for Port Hedland sixth car dumper (CD6).
  • US$2.1 billion cash payment for acquisition of Filo Corp and 50% interest in Josemaria copper deposit (Vicuña joint venture).
  • US$0.5 billion estimated spend for operational decarbonisation plans over the decade to FY2030, with at least US$4 billion anticipated in the 2030s.
  • US$60 million spent in FY2025 to support collaborative partnerships, consortiums, R&D, and BHP Ventures investments.

Currency Impact Analysis:

• Foreign exchange impact on revenue and earnings: Positive impact of US$354 million on Underlying EBITDA in FY2025.
• Hedging strategies and effectiveness: Uses derivative financial instruments to hedge cash and borrowings to reduce volatility from foreign exchange and interest rates.
• Functional currency considerations: The US dollar is the predominant functional currency of Group operations.

Business Segment Analysis

Copper

Financial Performance:

• Revenue: $22,530 million (+21.4% YoY)
• Underlying EBITDA: $12,326 million (+44.7% YoY)
• Operating Margin: 44.2%
• Key Growth Drivers: Record production (2,017 kt, +8% YoY), higher concentrator feed grade and throughput at Escondida, operational improvements, mine sequencing, and record production at Spence. Stronger than expected Chinese copper demand in FY2025. Global demand expected to grow from ~33 Mt today to >50 Mt by 2050.

Product Portfolio:

• Major product lines: Copper concentrate and cathodes, gold, silver, molybdenum, uranium.
• New product launches: Full SaL leaching project achieved first production in Q4 FY2025 at Escondida. Hydrofloat technology commissioned in Q4 at Carrapateena.

Market Dynamics:

• Competitive positioning within segment: BHP Group Limited is a major global copper producer, with Escondida being a significant asset.
• Key customer types and regional market trends: Chinese copper demand was stronger than expected.
• Regulatory environment by jurisdiction: New collective agreements with Union N°1 and Union N°3 at Escondida (36 months from Aug 2024 and Dec 2024, respectively).

Geographic Revenue Distribution:

• Chile (Escondida, Pampa Norte): Escondida revenue US$13,177 million. Pampa Norte revenue US$2,726 million.
• Australia (Copper South Australia): Copper South Australia revenue US$4,655 million.
• Growth Markets: Vicuña joint venture (Argentina-Chile border) and Resolution Copper (Arizona, US) represent future growth options.

Iron Ore

Financial Performance:

• Revenue: $22,919 million (-17.9% YoY)
• Underlying EBITDA: $14,396 million (-23.9% YoY)
• Operating Margin: 53.0%
• Key Growth Drivers: Record production (263 Mt, +1% YoY) driven by supply chain excellence, improved rail cycle times, and enhanced car dumper and ship loader performance from Port Debottlenecking Project 1 (PDP1). South Flank exceeded nameplate capacity.

Product Portfolio:

• Major product lines: Iron ore fines and pellets.

Market Dynamics:

• Competitive positioning within segment: BHP Group Limited is the lowest-cost major iron ore producer globally for the sixth consecutive year.
• Key customer types and regional market trends: Not explicitly detailed, but global steelmaking demand is a primary driver.

Geographic Revenue Distribution:

• Western Australia (WAIO): WAIO revenue US$22,767 million.
• Brazil (Samarco): Samarco iron ore pellets and ore fines production: 6.3 Mt (BHP Group Limited share) (+34% YoY). Achieved full phase two ramp up in May 2025, reaching 60% of total 26 Mtpa (100% basis) capacity.

Coal

Financial Performance:

• Revenue: $5,046 million (-34.2% YoY)
• Underlying EBITDA: $573 million (-75.0% YoY)
• Operating Margin: -0.7%
• Key Growth Drivers: Steelmaking coal production (BHP Mitsubishi Alliance) increased 5% to 18 Mt (excluding divested mines). Energy coal production (New South Wales Energy Coal) was 15 Mt (-2% YoY).

Product Portfolio:

• Major product lines: Steelmaking coal (Goonyella Riverside, Broadmeadow, Peak Downs, Saraji, Caval Ridge) and Energy coal (Mt Arthur Coal).

Market Dynamics:

• Competitive positioning within segment: Focus on higher-quality steelmaking coals preferred by customers.
• Key customer types and regional market trends: Not explicitly detailed.
• Regulatory environment by jurisdiction: New South Wales Government approved extension of mining activities at Mt Arthur Coal for an additional four years, from July 2026 to June 2030.

Geographic Revenue Distribution:

• Queensland (BHP Mitsubishi Alliance): BMA revenue US$3,422 million.
• New South Wales (New South Wales Energy Coal): NSWEC revenue US$1,624 million.

Other Assets (Potash, Nickel)

Financial Performance:

• Potash (Jansen potash project):
  • Underlying EBITDA loss: US$284 million (FY2025).
  • Capital expenditure: US$1,642 million.
  • Jansen Stage 1 (JS1) 68% complete, first production estimated mid-CY2027. Estimated capital expenditure for JS1 increased from US$5.7 billion to US$7.0 billion–US$7.4 billion.
  • Jansen Stage 2 (JS2) 11% complete, first production shifted from FY2029 to FY2031.
• Western Australia Nickel:
  • Revenue: US$758 million (-48.1% YoY).
  • Underlying EBITDA loss: US$0.6 billion (FY2025).
  • Production: 30 kt (-63% YoY).
  • Operations transitioned into temporary suspension at end of H1 FY2025.

Product Portfolio:

• Major product lines: Potash (Jansen potash project), Nickel (Western Australia Nickel).

Market Dynamics:

• Competitive positioning within segment: Jansen is expected to have operating costs at the low end of the cost curve when fully ramped up. Western Australia Nickel operations were impacted by oversupply in the global nickel market and a sharp decline in forward nickel prices.

Geographic Revenue Distribution:

• Canada (Jansen potash project): BHP Group Limited holds mineral leases covering approximately 9,600 square kilometres in the Saskatchewan potash basin.
• Western Australia (Western Australia Nickel): Operations transitioned into temporary suspension.

International Operations & Geographic Analysis

Revenue by Geography:

International Business Structure:

• Subsidiaries: Key international subsidiaries include BHP Billiton Freight Singapore Pte Limited (Singapore), BHP Billiton Marketing AG (Switzerland), BHP Billiton Marketing Asia Pte Ltd (Singapore), BHP Billiton Finance B.V. (The Netherlands), BHP Canada Inc. (Canada), Compañia Minera Cerro Colorado Limitada (Chile), Minera Escondida Ltda (Chile), Minera Spence SA (Chile).
• Joint Ventures: Strategic partnerships include Escondida (57.5%), Antamina (33.75%), Resolution Copper (45%), Vicuña (50%), Western Australia Iron Ore (85% for main JVs, 65% for POSMAC), Samarco (50%), BHP Mitsubishi Alliance (50%), and Newcastle Coal Infrastructure Group (28%).
• Licensing Agreements: Not explicitly detailed as licensing agreements, but BHP Group Limited's designed technology, Full SaL leaching project, achieved first production at Escondida.

Cross-Border Trade:

• Export Markets: Primary export destinations for commodities (copper, iron ore, steelmaking coal, potash, uranium, gold) include China, developing Asia, Developed Asia, Europe, and the United States.
• Transfer Pricing: The company's international tax strategy includes transfer pricing policies and documentation requirements.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: No on-market or off-market share buy-back programs occurred in FY2025.
• Dividend Payments: US$5.6 billion in cash dividends (US$1.10 per share) determined for FY2025. Total dividends paid during FY2025 were US$6,286 million (US$1.24 per share). Over the past five years, total cash dividends exceeded US$50 billion.
• Future Capital Return Commitments: The dividend policy provides for a minimum 50% payout of Underlying attributable profit.

Balance Sheet Position:

• Cash and Equivalents: $11,894 million
• Total Debt: $24,496 million
• Net Cash Position: Net debt of $12,924 million (FY2025), an increase of US$3.8 billion from FY2024.
• Credit Rating: Moody’s A1/P-1 outlook stable; Fitch A/F1 outlook stable.
• Debt Maturity Profile:
  • US$3.0 billion USD bonds issued in February 2025 (due CY2030, CY2032, CY2035).
  • US$1.0 billion three-year term loan entered in December 2024.
  • US$5.5 billion committed standby facility available and undrawn, refinanced on 10 July 2025 with a five-year maturity and two one-year extension options.
  • Undiscounted contractual maturities for total financial liabilities: US$10,119 million (in one year or less), US$3,469 million (1-2 years), US$10,944 million (2-5 years), US$19,607 million (more than 5 years).

Cash Flow Generation:

• Operating Cash Flow: $18,692 million
• Free Cash Flow: $5,342 million

Currency Management:

• Cash holdings by major currencies (FY2025): USD US$4,507 million, AUD US$3,611 million, CAD US$3,369 million, EUR US$8 million, GBP US$25 million, Other US$374 million.
• Financial hedging instruments and strategies: Uses derivative financial instruments to hedge cash and borrowings to reduce volatility from foreign exchange and interest rates.

Operational Excellence

Production & Service Model: BHP Group Limited employs both open-cut and underground mining methods across its diverse portfolio. Its operational philosophy is driven by the BHP Operating System (BOS), which focuses on continuous improvement and operating excellence to enhance safety, operational, and financial performance. The company's integrated supply chain manages products from extraction through to market.

Global Supply Chain Architecture: Key Suppliers & Partners:

• Traditional Owners and Indigenous businesses: Record spend of over A$500 million (+14% YoY) in Western Australia Iron Ore, including over A$300 million with 67 Traditional Owner businesses. Direct global spend with Indigenous businesses increased 40% to US$853 million in FY2025.
• ACCIONA Energía: Partnered to explore a pumped hydro energy storage project at Mt Arthur Coal.
• Mitsubishi Development: 50% joint venture partner in BHP Mitsubishi Alliance.
• Rio Tinto: 30% partner in Escondida and 55% operator of Resolution Copper.
• Lundin Mining: 50% joint venture partner in Vicuña Corp.
• Vale S.A.: 50% joint venture partner in Samarco Mineração S.A.

Facility Network:

• Manufacturing: Key production facilities include concentrators and leaching projects at Escondida, concentrators at Spence, Hydrofloat technology at Carrapateena, and a smelter at Olympic Dam. Iron ore processing facilities are located in Western Australia (Port Hedland) and Brazil (Samarco). Nickel processing facilities (concentrator, smelter, refinery) in Western Australia are currently under temporary suspension.
• Research & Development: BHP Group Limited operates a global R&D network, including BHP Ventures which invests in companies developing game-changing technologies (e.g., ore characterisation, industrial robotics, physical AI systems, subsurface mapping, ammonia cracking for maritime decarbonisation). The BHP Xplor accelerator program supports 21 companies across seven countries.
• Distribution: The global Sales and Marketing team connects BHP Group Limited to its markets, supported by port infrastructure such as Port Hedland for iron ore.

Operational Metrics: BHP Group Limited achieved strong operational performance with no fatalities in FY2025, and total recordable injury and high potential injury frequency measures were lower than the prior year. Critical technology service availability is nearly 100%. South Flank (WAIO) exceeded its nameplate capacity of 80 Mtpa (100% basis) in its first year. Samarco achieved full phase two ramp up in May 2025, reaching 60% of its total 26 Mtpa (100% basis) capacity. The Jansen Stage 1 potash project is 68% complete, and Stage 2 is 11% complete. The global workforce comprises over 90,000 employees and contractors, with contractors making up approximately 55%.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Direct Sales: BHP Group Limited's Sales and Marketing team directly connects the company to its global customer base.
• Digital Platforms: Not explicitly detailed.

Customer Portfolio: Enterprise Customers:

• Customer Concentration: The 10 largest customers represented 35% of total credit risk exposures in FY2025.
• Strategic Partnerships: Not explicitly detailed.

Regional Market Penetration:

• Australia: Western Australia Iron Ore achieved record spend with Traditional Owners and Indigenous businesses, exceeding A$500 million (+14% YoY), including over A$300 million with 67 Traditional Owner businesses.
• Growth Markets: Not explicitly detailed for market share, but copper demand in China was stronger than expected in FY2025.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics:

• Industry growth rates: The world needs approximately 10 Mt of new annual copper mine supply over the next 10 years, with demand expected to grow from ~33 Mt today to >50 Mt by 2050.
• Key trends driving industry evolution: A strategic shift towards future-facing commodities (copper, potash) and higher-quality steelmaking materials, alongside significant decarbonisation efforts across the value chain.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Closest major competitor: BHP Group Limited's EBITDA margin averaged 55% over the past decade, approximately 10 percentage points above its closest major competitor (name not disclosed).
• Rio Tinto: A significant competitor, particularly in copper (30% partner in Escondida, 55% operator of Resolution Copper).
• Vale S.A.: A key competitor and 50% joint venture partner in Samarco Mineração S.A.
• Glencore, Teck, Mitsubishi: Partners in the Antamina copper and zinc mining operation.
• Lundin Mining: A partner in the Vicuña copper development joint venture.

Regional Competitive Dynamics: The competitive landscape varies by commodity and region, with BHP Group Limited maintaining a cost advantage in iron ore and strategically investing in future-facing commodities like copper and potash to enhance its long-term competitive position.

Risk Assessment Framework

Strategic & Market Risks

Global Market Dynamics:

• Commodity Price Volatility: Significant impact on financial performance. A US¢1/lb change in copper price impacts profit after taxation by US$29 million, and a US$1/t change in iron ore price impacts profit after taxation by US$162 million. Oversupply in the global nickel market and a sharp decline in forward nickel prices led to the temporary suspension of Western Australia Nickel operations.
• Technology Disruption: High risk associated with adopting new technologies and maintaining digital security.
• Customer Concentration: The 10 largest customers represented 35% of total credit risk exposures in FY2025.

Operational & Execution Risks

Global Supply Chain Vulnerabilities:

• Regional Disruptions: Operational events are assessed as a medium risk. Physical risks, including those from operational events and significant social or environmental impacts, are considered high. Inadequate business resilience is a medium risk.
• Trade Restrictions: Trade actions such as sanctions, tariffs, and restrictions imposed by the UN Security Council and various governments (UK, US, EU, China, Australia) may restrict BHP Group Limited's ability to sell or purchase goods and services.

Financial & Regulatory Risks

Currency & Financial Risks:

• Foreign Exchange: The US dollar is the functional currency, but significant exposure exists to AUD, CLP, CAD, EUR, GBP, and BRL. A one-cent strengthening in AUD, CAD, EUR, one penny strengthening in GBP, 10 pesos strengthening in CLP, or one centavo strengthening in BRL against the US dollar would decrease equity and profit after taxation by US$29 million. Derivative financial instruments are used for hedging.
• Interest Rate Risk: 98% of the Group’s borrowings are exposed to floating interest rates. A one percentage point increase in SOFR would decrease equity and profit after taxation by US$72 million.
• Credit & Liquidity: BHP Group Limited maintains stable credit ratings (Moody’s A1/P-1 outlook stable; Fitch A/F1 outlook stable) and has a US$5.5 billion committed revolving credit facility available and undrawn.

Regulatory & Compliance Risks:

• Multi-Jurisdictional Compliance: Operations are subject to complex and evolving laws and regulations across Australia, Chile, Peru, Brazil, Canada, the United States, and Europe, covering environmental protection, health and safety, human rights, competition, foreign investment, export, marketing, and taxation.
• Trade Regulations: Australian FATA conditions impose specific requirements on BHP Group Limited's corporate structure and operations in Australia.
• Tax Regulations: New mining royalties in Chile (effective 1 January 2024) and the implementation of Pillar Two Model Rules for income taxes present ongoing compliance challenges. Uncertain tax and royalty matters exist across many jurisdictions.
• Samarco Dam Failure: Ongoing legal proceedings and financial obligations related to the Samarco dam failure in Brazil, Australia, the UK, and the Netherlands represent a significant risk. A Settlement Agreement with Brazilian Public Authorities for R$170 billion (approximately US$31.7 billion, 100% basis) was ratified, with BHP Billiton Brasil and Vale S.A. as secondary obligors.

Geopolitical & External Risks

Country-Specific Risks:

• Political Risk: The Queensland Government passed legislation to prevent future governments from reversing the current progressive coal royalties system without parliamentary approval.
• Regulatory Changes: Increasing climate-related and broader sustainability-related disclosure rules are being enacted or proposed in jurisdictions such as Australia and the EU.

Innovation & Technology Leadership

Research & Development Focus: Global R&D Network:

• BHP Ventures: Invests in companies developing game-changing technologies, including ore characterisation, industrial robotics, physical AI systems, subsurface mapping, ammonia cracking for maritime decarbonisation, Boston Metal, and Electra.
• Innovation Pipeline: Successful pilots for Hydrofloat and Jameson cells (flotation technologies) have been conducted. A flame emissions probe was developed for the Olympic Dam smelter, and automated drill rigs are being trialled. BHP Group Limited supported 40 innovators in FY2025.
• Oak Dam: An Inferred Mineral Resource was announced at Oak Dam in August 2024.

Intellectual Property Portfolio:

• Patent Strategy: While not explicitly detailed, the development and first production of the BHP Group Limited-designed Full SaL leaching project at Escondida indicates a focus on proprietary technology and intellectual property.

Technology Partnerships:

• Strategic Alliances: The BHP Xplor accelerator program, established in FY2023, offers equity-free grants up to US$500,000 and has supported 21 companies to date, with the largest cohort (8 companies) spanning seven countries, fostering strategic alliances and research collaborations.

Leadership & Governance

Executive Leadership Team

International Management Structure: The Executive Leadership Team (ELT) includes regional presidents for Americas and Australia, reporting to the Chief Executive Officer. Oversight of sustainability-related topics transitioned from the ESG and Sustainability Steering Committee to the ELT in early FY2025, assisted by the Operating Committee. A new Ethics, Compliance and Human Rights team was established under a new Chief Ethics, Compliance and Human Rights Officer.

Board Composition: The Board comprises nine members, with all Non-executive Directors, including the Chair, considered independent. The Board is gender-balanced, with 44% female Directors, satisfying both UK Listing Rules and ASX Corporate Governance Council guidance. It also meets the UK Listing Rule target of having at least one Director from a minority ethnic background. The Board's skills matrix includes strong representation in global experience (8 Directors), strategy (9 Directors), and financial acumen (9 Directors). The Board has four standing Committees (Nomination and Governance, Risk and Audit, Sustainability, and People and Remuneration) with charters reviewed annually. Climate change, sexual harassment, and technology/cybersecurity risk are Board-level issues.

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework: Primary Regulatory Environments:

• Australia: Subject to the Australian Corporations Act 2001, Australian Accounting Standards, and International Financial Reporting Standards (IFRS). From FY2026, the Australian Sustainability Reporting Standard AASB S2: Climate-related Disclosures will be mandatory. Compliance with the Modern Slavery Act and the National Greenhouse and Energy Reporting Act 2007 (including the Safeguard Mechanism) is required. The Australian Foreign Acquisitions and Takeovers Act 1975 (FATA) imposes conditions on BHP Group Limited's corporate structure.
• Chile: New mining royalties took effect from 1 January 2024. Pension reform approved in January 2025 will result in a 7% company contribution, gradually increasing over nine years from August 2025. The 40-hour work week regulation continues gradual implementation.
• United States: As a registrant with the SEC and with American Depositary Shares listed on the New York Stock Exchange, BHP Group Limited is subject to US regulatory requirements, including those related to corporate governance and disclosure.
• European Union: The Corporate Sustainability Due Diligence Directive is anticipated to be phased in from 1 July 2028.

Cross-Border Compliance:

• Export Controls: The company is subject to trade actions, sanctions, tariffs, and restrictions by various governments and the UN Security Council, which may impact its ability to conduct cross-border trade.
• Anti-Corruption: A new Ethics, Compliance and Human Rights team has been established to manage related policies and advocacy.

International Tax Strategy:

• Transfer Pricing: The company's international tax strategy includes policies and documentation requirements for inter-company pricing.
• Tax Treaties: US holders eligible for Australian Tax Treaty benefits may receive reduced Australian withholding tax on dividends.
• BEPS Compliance: The company is subject to the Pillar Two Model Rules for income taxes.

Environmental & Social Impact

Global Sustainability Strategy: Environmental Commitments:

• Climate Strategy: Published its second Climate Transition Action Plan (CTAP 2024) in August 2024. Medium-term target: reduce operational GHG emissions (Scopes 1 and 2) by at least 30% by FY2030 from an FY2020 baseline. Long-term net zero goal: achieve net zero operational GHG emissions by CY2050. Value chain (Scope 3) goals include supporting 30% lower GHG emissions intensity for steelmaking by post-CY2030, 40% GHG emissions intensity reduction for BHP-chartered shipping by CY2030, and net zero Scope 3 GHG emissions by CY2050.
• Carbon Neutrality: Net zero by CY2050 for GHG emissions from all shipping of BHP Group Limited products and for operational GHG emissions of direct suppliers.
• Renewable Energy: Escondida’s operational water withdrawals have been sourced from desalinated seawater since FY2020. Escondida and Pampa Norte use 100% renewable electricity. The Kwinana nickel refinery's power is supplemented by a Power Purchase Agreement with Merredin Solar Farm for 50% output.
• Nature-positive outcomes: Committed to halting and reversing nature loss by 2030, with a goal to have at least 30% of land and water stewarded under conservation, restoration, or regenerative practices. In FY2025, the area under such practices increased to 98,415 hectares, and a 158,000-hectare voluntary conservation project was initiated at Copper South Australia.

Regional Sustainability Initiatives:

• Australia: The country has legislated national targets to reduce net GHG emissions to 43% below CY2005 levels by CY2030, and net zero by CY2050. The Western Australia Iron Ore progressive rehabilitation program completed over 1,000 hectares in FY2025.
• Chile: Escondida and Pampa Norte have a water efficiency target to improve by 10% by FY2030 from a FY2022 baseline.
• Supply Chain: Global supplier ESG requirements and sustainability standards are part of the company's "Responsible supply chains" goal.

Social Impact by Region:

• Community Investment: Voluntary social investment totaled US$127.8 million in FY2025, with US$70.1 million in direct funding for host communities and Indigenous partners. A$20 million Community Funds were established for Mt Arthur Coal and Western Australia Nickel.
• Labor Standards: Achieved its aspirational goal of gender balance in its global employee workforce (41.3% women) by CY2025. Indigenous employee participation rates were 8.2% in Australia, 10.5% in Minerals Americas operations in Chile, and 17.8% at the Jansen potash project in Canada.
• Indigenous Peoples: Direct global spend with Indigenous businesses increased 40% to US$853 million in FY2025. Minerals Australia's sixth Reconciliation Action Plan was released, and Canada and the US have Indigenous Partnerships Plans in place or commenced. Chile intends to publish a regional Indigenous Peoples Plan in FY2026.
• Tailings Storage Facilities (TSFs): As of August 2025, 61 of BHP Group Limited’s TSFs are aligned with GISTM, and 22 TSFs (92% of very high and extreme consequence TSFs) received third-party validation.

Currency Management & Financial Strategy

Multi-Currency Operations: Currency Exposure:

Hedging Strategies:

• Transaction Hedging: BHP Group Limited uses derivative financial instruments to hedge cash and borrowings, aiming to reduce volatility from foreign exchange and interest rates.
• Economic Hedging: Not explicitly detailed.