Balanced Update – BHP Group Limited (BHP)

*** GENERAL ADVICE ONLY***

BHP Q2 FY2025 Operational Performance Report

BHP delivered a strong operational performance in the second quarter of FY2025 (Q2 FY25), with increased production across key commodities compared to the previous quarter. Here’s a detailed summary of the quarterly production report:

Copper Production

Copper production increased to 510.7 kt in Q2 FY25, up 7% from Q1 FY25. This growth was primarily driven by:

• Escondida: Production rose 12% to 339.8 kt due to higher grades and improved recoveries.
• Pampa Norte: Output increased 10% to 66.2 kt.
• Copper South Australia: Production slightly decreased by 3% to 71.2 kt due to a weather-related power outage at Olympic Dam.

Iron Ore Production

Total iron ore production reached 66.2 Mt in Q2 FY25, a 2% increase from Q1 FY25. Key highlights include:

• Western Australia Iron Ore (WAIO): Production rose 2% to 64.8 Mt, benefiting from strong supply chain performance and the completion of the Port Debottlenecking Project (PDP).
• Samarco: Production increased 14% to 1.5 Mt.

Coal Production

Steelmaking Coal

• BMA production decreased slightly to 4.4 Mt in Q2 FY25, down 2% from Q1 FY25. This was due to:
  • Significant wet weather impacts
  • A longwall move at Broadmeadow.

Energy Coal

• NSW Energy Coal production increased marginally to 3.7 Mt, up 1% from Q1 FY25.

Nickel Production

Nickel production from Western Australia operations decreased significantly to 8.0 kt in Q2 FY25, down 59% from Q1 FY25. This sharp decline was expected as operations transitioned into temporary suspension in December 2024.

Operational Highlights

• Escondida achieved a 10-year production record in the first half of FY25.
• WAIO shipped record half-year tonnes through the port, enabled by supply chain improvements.
• The formation of Vicuña Corp., a joint venture with Lundin Mining, was completed to advance copper projects in Argentina.
• The Jansen Stage 1 potash project is now 63% complete, with first production scheduled for late 2026.

Guidance Updates

• FY25 production guidance remains unchanged for most assets, with expectations to deliver in the upper half of the range for WAIO, BMA, NSWEC, and Samarco.
• Copper SA production guidance for FY25 has been lowered due to the impacts of the weather-related power outage.

Financial Performance

While detailed financial results were not provided in this operational review, BHP noted that it maintains sector-leading cost discipline and remains on track to deliver FY25 unit cost guidance across all assets.