Profit at BHP has slumped to a five-year low as lower iron ore prices and economic turbulence have hit the mining giant.
The firm posted underlying attributable profit of $10.2bn (£7.6bn) in the year to June, a decline of 26 per cent compared to last year and the lowest since the start of the pandemic in 2020.
Revenue fell 8 per cent to $51.3bn, while BHP’s final dividend of 60 cents a share, a drop of nearly a fifth, was its lowest in eight years, though it came in slightly higher than analysts had expected.
BHP bemoaned a sustained fall in iron ore prices, adding global demand was “mixed.”
“Demand from developing Asian economies continued to grow along with new blast furnace capacity, while Developed Asia and European demand was impacted by planned blast furnace capacity retirements and maintenance in response to subdued steel demand,” the miner said.
“Rising trade protectionism could weigh on global iron ore and steel demand in the near term,” BHP warned, adding: “Policy uncertainty, particularly around tariffs, fiscal policy, monetary easing, and industrial policy, has been elevated and continues to influence investment and trade flows.”
The Australian mining giant said weaker iron ore prices had been offset by higher copper prices, with the firm upping its copper production by 28 per cent since 2022 to hit a fresh record.
BHP shares rose 1.6 per cent to A$42 in Sydney. The stock is up 5.4 per cent since the start of the year, after rebounding from an April slump triggered by Donald Trump’s “Liberation Day” tariff announcements.
In April last year, BHP made an attempt to acquire London-listed rival Anglo American for £31bn, a takeover which was rejected as “highly unattractive.” A second, improved offer in May was also rebuffed.
BHP warns on Chinese demand
BHP said China’s economic growth in the first half of 2025 had “exceeded expectations” amid increased government support for manufacturing in steel-intensive industries like machinery and car production.
But the firm cautioned that growth in the Country, which is one of its largest markets, was likely to be more muted in the second half of the year “as the temporary boost from ‘pulled-forward’ exports fades and tariffs continue to take effect.”
“Over the long term, population growth, urbanisation, rising living standards, and the infrastructure required for digitalisation and decarbonisation are all expected to drive demand for steel, non-ferrous metals and fertilisers,” BHP said.
Adam Vettese, market analyst for eToro, said: “Ultimately, BHP offers resilience and defensive attributes that appeal to long term investors, even as near-term profits are hit by commodity weakness.
“The company’s evolving focus on future facing commodities and its operational flexibility leave it well placed to benefit when the cycle turns. Investors will need to accept some short-term pain for the longer-term opportunity, but BHP’s scale, asset quality and strategy underpin a compelling investment case as the energy transition accelerates.”