BHP Group Limited (BHP) 6-K 2023 Q2 Current report (foreign)

Exhibit 99.1

Forward-looking statements

This release contains forward-looking statements, including statements regarding: trends in economic outlook; commodity prices and currency exchange rates; demand for commodities; medium-term guidance; reserves and resources and production forecasts; operational performance; expectations, plans, strategies and objectives of management; climate scenarios; approval of certain projects and consummation of certain transactions, including, but not limited to, our announced proposed acquisition of OZ Minerals Limited; closure or divestment of certain assets, operations or facilities (including associated costs); anticipated production or construction commencement dates; capital expenditure or costs and scheduling; operating costs, including unit cost guidance, and shortages of materials and skilled employees; anticipated productive lives of projects, mines and facilities; provisions and contingent liabilities; and tax and regulatory developments.

Forward-looking statements may be identified by the use of terminology, including, but not limited to, ‘intend’, ‘aim’, ‘ambition’, ‘aspiration’, ‘goal’, ‘target’, ‘prospect’, ‘project’, ‘see’, ‘anticipate’, ‘estimate’, ‘plan’, ‘objective’, ‘believe’, ‘expect’, ‘commit’, ‘may’, ‘should’, ‘need’, ‘must’, ‘will’, ‘would’, ‘continue’, ‘forecast’, ‘guidance’, ‘outlook’, ‘trend’ or similar words. These statements discuss future expectations concerning the results of assets or financial conditions, or provide other forward-looking information.

These forward-looking statements are based on management’s current expectations and reflect judgements, assumptions, estimates and other information available as at the date of this release and/or the date of the Group’s planning processes or scenario analysis processes. These statements do not represent guarantees or predictions of future financial or operational performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results to differ materially from those expressed in the statements contained in this release. BHP cautions against reliance on any forward-looking statements or guidance, including in light of the current economic climate and the significant volatility, uncertainty and disruption arising in connection with the Ukraine conflict and

COVID-19.

For example, our future revenues from our assets, projects or mines described in this release will be based, in part, on the market price of the minerals or metals produced, which may vary significantly from current levels. These variations, if materially adverse, may affect the timing or the feasibility of the development of a particular project, the expansion of certain facilities or mines, or the continuation of existing assets.

Other factors that may affect the actual construction or production commencement dates, revenues, costs or production output and anticipated lives of assets, mines or facilities include our ability to profitably produce and transport the minerals and/or metals extracted to applicable markets; the impact of foreign currency exchange rates on the market prices of the minerals or metals we produce; activities of government authorities in the countries where we sell our products and in the countries where we are exploring or developing projects, facilities or mines, including increases in taxes and royalties; changes in environmental and other regulations, the duration and severity of the Ukraine conflict and the

COVID-19

pandemic and their impact on our business; political or geopolitical uncertainty; labour unrest; weather, climate variability or other manifestations of climate change; and other factors identified in the risk factors discussed in BHP’s filings with the U.S. Securities and Exchange Commission (the ‘SEC’) (including in Annual Reports on Form

20-F)

which are available on the SEC’s website at

www.sec.gov

.

Except as required by applicable regulations or by law, BHP does not undertake to publicly update or review any forward-looking statements, whether as a result of new information or future events.

Non-IFRS

Financial Information

Our results are reported under International Financial Reporting Standards (IFRS). This release includes various

non-IFRS

financial information to reflect our underlying performance. These

non-IFRS

measures include: underlying EBIT, underlying EBITDA, underlying attributable profit, underlying basic earnings per ordinary share, underlying EBITDA margin, capital and exploration expenditure, net debt and gearing ratio.

Non-IFRS

measures have not been subject to audit or review. For further information on the reconciliations of certain

non-IFRS

financial information measures to our statutory measures, reasons for usefulness and calculation methodology, please refer to

non-IFRS

financial information set out on

pages R-1

to

R-13.

BHP and its subsidiaries

In this release, the terms ‘BHP’, the ‘Company, the ‘Group’, ‘BHP Group’, ‘our business’, ‘organisation’, ‘we’, ‘us’, ‘our’ and ourselves’ refer to BHP Group Limited and, except where the context otherwise requires, our subsidiaries. Refer to note 28 ‘Subsidiaries’ of the Financial Statements in the FY2022 Annual Report and Form

20-F

for a list of our significant subsidiaries. Those terms do not include

non-operated

assets.

This release covers functions and assets (including those under exploration, projects in development or execution phases, sites and closed operations) that have been wholly owned and/or operated by BHP or that have been owned as a joint venture

1

operated by BHP (referred to in this release as ‘operated assets’ or ‘operations’) during the period from 1 July 2022 to 31 December 2022. BHP also holds interests in assets that are owned as a joint venture but not operated by BHP (referred to in this release as

‘non-operated

joint ventures’ or

‘non-operated

assets’). Notwithstanding that this release may include production, financial and other information from

non-operated

assets,

non-operated

assets are not included in the BHP Group and, as a result, statements regarding our operations, assets and values apply only to our operated assets unless stated otherwise.

Throughout this release, all references to ‘the prior period’ are to the half year ended 31 December 2021.

1

Release

BHP RESULTS FOR THE HALF YEAR ENDED 31 DECEMBER 2022

Note: All results presented in the Release are on a continuing operations basis, except as noted.

Safety and sustainability: Unwavering focus on making our operations safe, sustainable and inclusive

• A colleague tragically lost his life in a rail incident at our Port Hedland operation in February 2023. We remain resolute in our commitment to making BHP safe.

• Females now represent 33.6% of our workforce, a near doubling since we announced our aspirational goal for gender balance in 2016.

• We continue to make good progress against our Social Value Framework, creating value for our people, partners, the economy, the environment and local communities.

Operational excellence: Reliable operational performance and disciplined cost control

• Strong supply chain performance at Western Australia Iron Ore (WAIO) underpinned record half year production and our continued leading C1 unit cost position of US$15.50 per tonne. 1

• Profit from operations of US$10.8 billion, down 27% from the prior period, driven by a US$4.8 billion reduction in revenue which largely reflects lower iron ore and copper prices. Underlying EBITDA 1 of US$13.2 billion.

• Attributable profit from total operations of US$6.5 billion and Underlying attributable profit 1 of US$6.6 billion, each down 32% from the prior period.

• Net operating cash flow of US$6.8 billion and free cash flow 1 of US$3.5 billion.

• We paid US$7.5 billion in tax and royalty payments to governments in the December 2022 half year.

Disciplined capital allocation: Strong balance sheet enables our strategy

• Capital expenditure of US$2,871 million and exploration expenditure of US$156 million. Capital and exploration expenditure 1 of US$3.0 billion. Guidance for capital and exploration expenditure for the full year of US$7.6 billion remains unchanged.

• The Jansen Stage 1 project is tracking to plan, with targeted first production brought forward to 2026, from 2027. We have commenced a feasibility study for Jansen Stage 2, which we expect to be completed during the 2024 financial year.

• We continued to expand our opportunities in future facing commodities through additional drilling at Oak Dam, adding to our portfolio of early-stage entry investments, and the launch of BHP Xplor.

• In December 2022, we entered into a Scheme Implementation Deed with OZ Minerals Ltd (OZL) to acquire 100% of OZL by way of a scheme arrangement for a cash price of A$28.25 per OZL share, which corresponds to an enterprise value of A$9.8 billion ii .

• Our commitment to a strong balance sheet through the commodity price cycle remains, with interest bearing liabilities of US$14.7 billion (30 June 2022: US$16.4 billion; 31 December 2021: US$19.0 billion), Cash and cash equivalents of US$9.6 billion (30 June 2022: US$17.2 billion; 31 December 2021: US$12.4 billion) and net debt 1 at 31 December 2022 of US$6.9 billion, towards the bottom of our target range for net debt of between US$5 and US$15 billion.

Value and returns: Interim dividend of 90 US cps

• The Board has determined to pay an interim dividend of 90 US cents per share (or US$4.6 billion), equivalent to a 69% payout ratio.

1  We use non-IFRS financial information to reflect our underlying financial performance. Underlying EBITDA, Underlying attributable profit, free cash flow and net debt are non-IFRS financial information measures. Unit costs is one of our non-IFRS financial information measures used to monitor the performance of our individual assets and is included in the analysis of each reportable segment. For the definition and method of calculation of our non-IFRS financial information measures, including Unit costs, refer to pages R-1 to R-13.

2

Health and safety

The safety, health and wellbeing of our workforce and the communities in which we operate is our highest priority. Tragically, on 7 February 2023, one of our colleagues was fatally injured in an incident at our rail yard in Port Hedland, Western Australia. A full investigation is underway to understand what happened and the circumstances that led to this fatality.

Our strong focus on safety and health includes our commitment towards the elimination of sexual harassment, racism and bullying in our workplaces and our accommodation villages. There is no place for these behaviours in society or at BHP. We are continuing to build awareness, understanding, and capability across our workforce, enhancing prevention controls globally, and strengthening how we respond and support impacted persons when these incidents occur. Over the last 12 months, this focus has included holding global safety stops, with leaders directly engaging with all our teams in all locations about sexual harassment, racism and bullying, as well as progressively deploying active bystander training, which seeks to empower everyone to speak up against disrespectful or harmful behaviours. In parallel, we are also taking further steps to encourage reporting of sexual harassment, and ensure our workforce feel safe to do so. We continue to engage with external experts and our workforce to learn from best practice and enhance our approach.

Key safety indicators

1

:

	Target/Goal	H1 FY23		H2 FY22		H1 FY22		FY22		Comment
Fatalities	Zero work-related fatalities		0		0		0		0	A fatal incident occurred subsequently at our WAIO operations in February.
High-potential injury (HPI) frequency iii (per million hours worked)	Year-on-year improvement in HPI frequency		0.13		0.12		0.17		0.14	20 per cent decrease from H1 FY22. Decrease of 45 per cent since FY20.
Total recordable injury frequency (TRIF) iii (per million hours worked)	Year-on-year improvement in TRIF		4.1		4.2		3.8		4.0	Increase of 6 per cent from H1 FY22 and 4 per cent decrease since FY20.

1 All data points are presented on a total operations basis, unless otherwise noted, and are indicative and subject to non-financial assurance reviews. FY22 data includes the operated assets in our Petroleum business up to the date of the merger (1 June 2022) and BHP Mitsui Coal (BMC) up to the date of completion of the sale (3 May 2022).

Creating social value

By prioritising both financial and social value, we can create mutual benefits for our stakeholders and deliver long-term value for our shareholders. Social value is our positive contribution to society – our people, partners, the economy, the environment and local communities – anchored in enduring, mutually beneficial and trusting relationships.

In June 2022, we launched our social value scorecard with 2030 goals, metrics and milestones. Below is an indication of progress over the past six months.

Key milestones and achievements

• Baseline mapping of Important Biodiversity and Ecosystems (IBEs) in the Minerals Australia region is complete, and on track to complete in the Minerals Americas region by the end of the 2023 financial year. This will be used to identify priority areas for action to meet our 2030 goal of creating nature-positive iv outcomes by having at least 30 per cent of the land and water we steward under conservation, restoration or regenerative practices.

• In November 2022, we released our updated Indigenous Peoples Policy Statement . The revised global policy statement outlines our commitment to working with Indigenous Peoples to support reconciliation and contribute to improved social, economic and environmental outcomes.

• Context Based Water Targets (CBWTs) are intended to contribute to more effectively addressing the shared water challenges in our operating regions and are informed by our catchment knowledge and our Water Resource Situational Analyses. Development of the CBWTs is on track and we intend to publish them prior to the end of the 2023 financial year.

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Release

Samarco

BHP Brasil remains committed to Samarco supporting the Renova Foundation and its work to progress the remediation and compensatory programs to restore the environment and

re-establish

communities affected by the Samarco dam failure, as set out in the Framework Agreement entered into in March 2016 by BHP Brasil, Samarco, Vale and relevant Brazilian authorities.

In total, the Renova Foundation has spent R$28.1 billion (approximately US$5.9 billion

v

) on remediation and compensation programs to 31 December 2022, with compensation and financial assistance paid to approximately 410,000 people and approximately 70 per cent of resettlement cases completed.

The Group’s provisions related to the Samarco dam failure and Germano dam decommissioning totalled US$3.3 billion as at 31 December 2022, with cost estimates for the Samarco dam failure provision unchanged from the June 2022 half. The expected cash outlay over the next 12 months in relation to these provisions is US$1.95 billion. In December 2022, BHP Brasil agreed to fund US$915 million in further financial support for the Renova Foundation. This funding is for the 2023 calendar year and will be offset against the Group’s provision for the Samarco dam failure. Further funding requirements for the period to 31 December 2023 continue to be assessed and will be subject to future approval by BHP Brasil. Please see note 9 – ‘Significant events – Samarco dam failure’ for the Samarco dam failure provisions.

BHP Brasil, Samarco, Vale, Federal and State prosecutors and other public entities have been engaging in negotiations to seek a definitive and substantive settlement of the obligations under the Framework Agreement and the R$155 billion (approximately US$30 billion

v

) claim. Outcomes of the negotiations are highly uncertain.

Samarco’s Judicial Reorganisation process is continuing in the Commercial Courts of Belo Horizonte, State of Minas Gerais. The Judicial Reorganisation is a process for Samarco to restructure its financial debts in order to establish a sustainable independent financial position that would allow Samarco to, among other things, continue its operations safely and meet its Renova Foundation obligations. BHP Brasil will continue to support Samarco in this process.

Financial performance

Results for the half year ended 31 December 2022

Half year ended 31 December	2022 US$M		2021 US$M		Change %
Revenue		25,713		30,527		(16	%)
Profit from operations		10,833		14,845		(27	%)
Attributable profit (total operations)		6,457		9,443		(32	%)
Basic earnings per share (cents)		127.5		186.6		(32	%)
Interim dividend per share (cents)		90		150.0		(40	%)
Net operating cash flow		6,770		11,529		(41	%)
Capital and exploration expenditure*		3,027		2,878		5	%
Net debt*		6,910		6,090		13	%
Underlying EBITDA *		13,230		18,463		(28	%)
Underlying attributable profit *		6,597		9,715		(32	%)
Underlying basic earnings per ordinary share (cents) *		130.3		192.0		(32	%)

* We use non-IFRS financial information to reflect our underlying financial performance. Capital and exploration expenditure, underlying EBITDA, underlying attributable profit, underlying basic earnings per ordinary share, free cash flow, net debt, gearing ratio, underlying EBITDA margin and underlying return on capital employed are non-IFRS financial information measures that are presented in this “Financial performance” section of this Release. For a discussion of the non-IFRS financial information we use refer to pages R-1 to R-13.

Earnings and margins

• Attributable profit from total operations of US$6.5 billion includes an exceptional loss of US$0.1 billion (31 December 2021: US$9.4 billion, which included an exceptional loss of US$1.2 billion).

• The exceptional loss of US$0.1 billion (after tax) relates to the current half year impact of the Samarco dam failure of US$140 million.

• Underlying attributable profit of US$6.6 billion (31 December 2021: US$9.7 billion) was underpinned by strong operational and cost performance across our operations.

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BHP Results for the half year ended 31 December 2022

• Profit from operations of US$10.8 billion (31 December 2021: US$14.8 billion) decreased as a result of lower realised prices for iron ore and copper, higher royalties as a result of the increased Queensland Government royalty rates, and inflationary impacts across the group, partially offset by record production at WAIO, higher realised prices for thermal coal and nickel, and favourable exchange rate movements.

• Underlying EBITDA of US$13.2 billion (31 December 2021: US$18.5 billion), with an Underlying EBITDA margin of 54 per cent (31 December 2021: 64 per cent). Additional commentary is included on page 12.

• Underlying return on capital employed decreased to 29.4 per cent (31 December 2021: 39.5 per cent).

Costs

• We continue to see the lagged impact of inflationary pressures, in particular for diesel, with an effective inflation rate of approximately 12 per cent. Across the Group, inventory movements were also a significant driver of higher unit costs 2 during the period, as a result of both planned drawdowns of stockpiles and the consequences of labour availability challenges and significant wet weather. Outside of these factors, our focus on cost discipline has allowed us to effectively manage in the current environment.

• Unit costs at WAIO were above guidance at the half year (based on guidance exchange rates of AUD/USD 0.72) primarily due to the drawdown of mine inventories as a result of labour availability, and the impact of inflation, particularly for diesel.

• Escondida unit costs were at the top end of the guidance range at the half year (based on guidance exchange rates of USD/CLP 830), reflecting volumes tracking to the low end of the production guidance range due to lower than expected concentrator feed grade and throughput.

• BHP Mitsubishi Alliance (BMA) unit costs were above the revised guidance range at the half year (based on guidance exchange rates of AUD/USD 0.72) primarily due to significant wet weather impacts on production during the first half, inventory movements and inflationary pressures. A stronger second half performance is expected following planned maintenance undertaken in the first half but remains subject to further potential wet weather impacts.

• New South Wales Energy Coal (NSWEC) unit costs were above the revised guidance range at the half year (based on guidance exchange rates of AUD/USD 0.72) primarily due to lower volumes as a result of record wet weather and increased port costs driven by higher thermal coal prices and inflation.

• Full year unit cost guidance for WAIO and Escondida remains unchanged (based on guidance exchange rates of AUD/USD 0.72 and USD/CLP 830) however are tracking towards the upper end of their guidance ranges. Unit cost guidance for BMA and NSWEC has been increased, largely reflecting the production impacts of significant wet weather and inflationary pressures.

• Historical costs and guidance are summarised below:

							H1 FY23 at
	Medium-term guidance 1			FY23 guidance 1			guidance exchange rates 1		realised exchange rates 2		H1 FY22		H1 FY23 vs H1 FY22
Escondida unit cost (US$/lb)		<1.15			1.25 -1.45			1.45		1.44		1.29		12	%
WAIO unit cost (US$/t) 3		<17			18 - 19			19.28		18.30		16.15		13	%
BMA unit cost (US$/t)		–	4		100 - 105	5		108.32		100.23		95.09		5	%
NSWEC unit cost (US$/t)		–			84 - 91	5		108.85		101.07		67.62		49	%

1 FY23 and medium-term unit cost guidance are based on exchange rates of AUD/USD 0.72 and USD/CLP 830.

2 Average realised exchange rates for H1 FY23 of AUD/USD 0.67 and USD/CLP 920.

3 WAIO unit costs exclude freight and government royalties. C1 unit costs, excluding third party royalties, are detailed on page 18.

4 Given ongoing uncertainty regarding restrictions on coal imports into China and the increase in the Queensland royalty rates, we are unable to provide medium-term unit cost guidance for BMA.

2  Unit costs is one of our non-IFRS financial information measures used to monitor the performance of our individual assets and is included in the analysis of each reportable segment. For the definition and method of calculation of our non-IFRS financial measures, including Underlying EBITDA and Unit costs, refer to pages R-1 to R-13.

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Release

5 Revised in the December 2022 Operational Review. BMA increased from US$90-100 per tonne; and NSWEC increased from US$76-86 per tonne.

• Production and guidance are summarised below:

Production	Medium-term guidance			FY23 guidance			H1 FY23		H1 FY22		H1 FY23 vs H1 FY22
Copper (kt)					1,635 –1,825			834		742		12	%
Escondida (kt)		~1,200	1		1,080 –1,180	Low end		511		488		5	%
Other copper 2 (kt)					555 – 645	Unchanged		324		254		28	%
Iron ore (Mt)					249 – 260			132		129		2	%
WAIO (Mt)					246 – 256	Unchanged		130		127		2	%
WAIO (100% basis) (Mt)		>300	3		278 – 290	Unchanged		146		144		1	%
Samarco (Mt)					3 – 4	Unchanged		2.2		2.1		8	%
Metallurgical coal – BMA (Mt)		–	4		29 – 32			14		13		5	%
BMA (100% basis) (Mt)					58 – 64	Low end		27		26		5	%
Energy Coal - NSWEC (Mt)					13 – 15	Unchanged		5.5		7.2		(24	%)
Nickel (kt)					80 – 90	Unchanged		38		39		(2	%)

1 Represents annual average copper production over the medium term.

2 Other copper comprises Pampa Norte, Olympic Dam and Antamina.

3 Our near-term focus remains on sustainable achievement of 290 Mtpa of iron ore, and our current medium-term plan is to creep production to greater than 300 Mtpa.

4 Given ongoing uncertainty regarding restrictions on coal imports into China and the increase in the Queensland royalty rates, we are unable to provide medium-term production guidance for BMA.

Cash flow and balance sheet

• Net operating cash flows of US$6.8 billion (31 December 2021: US$11.5 billion) reflects lower iron ore and copper prices, partially offset by reliable operational performance and cost discipline during the period. This includes an unfavourable working capital movement of US$1.2 billion largely related to royalty payables, net price impacts on receivables and other movements. Income tax and royalty-related taxation payments of US$5.5 vi billion include approximately US$2.7 billion of tax instalments and final tax payments relating to the 2022 financial year, and which reflected a higher price environment.

• Free cash flow of US$3.5 billion for the half year, inclusive of capital and exploration expenditure of US$3.0 billion.

• Our balance sheet remains strong with interest bearing liabilities of US$14.7 billion (30 June 2022: US$16.4 billion; 31 December 2021: US$19.0 billion), Cash and cash equivalents of US$9.6 billion (30 June 2022: US$17.2 billion; 31 December 2021: US$12.4 billion) and net debt at US$6.9 billion at 31 December 2022 (30 June 2022: US$0.3 billion; 31 December 2021: US$6.1 billion), towards the bottom of our target range for net debt. The increase of US$6.6 billion in net debt in the half year (or an increase of US$0.8 billion from 31 December 2021) reflects the final dividend paid to shareholders in September 2022 of US$8.7 billion and dividends paid to non-controlling interests of US$0.5 billion, partially offset by the free cash flow generated by our operations.

	H1 FY23 US$M			H1 FY22 US$M
Net debt at the beginning of the period		333			4,121
Lease additions		320			497
Free cash flow		(3,481	)		(9,688	)
Dividends paid 1		8,660			10,029
Dividends paid to NCI		527			1,273
Transfer to liability directly associated with assets held for sale		–			(528	)
Other movements		551			386
Net debt at the end of the period		6,910			6,090

1 US$209 million settlement of derivative related to the funding of the final FY22 dividend is included in free cash flow. The combined payment of US$8.9 billion represents the final dividend determined on 16 August 2022 in the financial results for the year ended 30 June 2022

• Gearing ratio of 12.9 per cent (30 June 2022: 0.7 per cent; 31 December 2021: 10.0 per cent).

Dividends

• The Board has determined to pay an interim dividend of 90 US cents per share or US$4.6 billion, including an additional amount of US$1.3 billion above the minimum payout policy. This is equivalent to a 69 per cent payout ratio (31 December 2021: 78 per cent).

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BHP Results for the half year ended 31 December 2022

• We have consistently delivered high cash returns, with more than US$39 billion of total announced returns to shareholders over the last three years.

Capital and exploration

• Capital expenditure of US$2,871 million and exploration expenditure of US$156 million. Capital and exploration expenditure of US$3.0 billion in the December 2022 half year included maintenance expenditure vii of US$1.1 billion and exploration expenditure of US$0.2 billion.

• Capital and exploration expenditure of approximately US$7.6 billion is expected for the 2023 financial year. Guidance is subject to exchange rate movements.

• Historical capital and exploration expenditure and guidance are summarised below:

	FY23e US$M		H1 FY23 US$M		H1 FY22 US$M		FY22 US$M
Maintenance 1		3,500		1,128		1,090		2,754
Development		3,700		1,743		1,678		3,101
Capital expenditure (purchases of property, plant and equipment)		7,200		2,871		2,768		5,855
Add: exploration expenditure		400		156		110		256
Capital and exploration expenditure		7,600		3,027		2,878		6,111

1 Includes capitalised deferred stripping of approximately US$800 million for FY23 and US$432 million for H1 FY23 (H1 FY22: US$409 million; FY22: $790 million).

• Average annual sustaining capital expenditure guidance over the medium term, excluding costs associated with greenhouse gas emissions abatement and our automation programs, for WAIO remains unchanged at approximately US$5 per tonne viii .

• As a result of the Queensland Government’s decision to raise coal royalties to the highest maximum rate in the world, the fiscal environment is no longer competitive or predictable and as such BMA is not making significant new investments in Queensland and is not providing annual sustaining capital expenditure guidance at this time.

• Capital expenditure on operational decarbonisation is expected to be around US$4 billion in aggregate up to the 2030 financial year and is assessed through the capital allocation framework to ensure alignment with our FY30 and 2050 operational emissions reduction target and goal and maximise shareholder value.

Projects

• At the end of the December 2022 half year, the Jansen Stage 1 project was tracking to plan. During the half, we brought forward the target for first production from 2027 to the end of the 2026 calendar year. Capital expenditure for the December 2022 half year was US$364 million, largely for surface and civil works and acceleration of procurement contracts.

• Expected Jansen Stage 1 capital expenditure for the 2023 financial year has increased to approximately US$860 million, from approximately US$740 million, partly due to an accelerated production schedule. There is no change to the project’s total capital expenditure budget of US$5.7 billion (C$7.5 billion). Work in the 2023 financial year will continue to focus on civil and mechanical construction on the surface and underground, as well as equipment procurement and port construction. We have awarded US$2.5 billion in contracts, covering the port, underground, mining systems and other construction activities.

• In addition, we have accelerated the feasibility study for Jansen Stage 2, to be completed during the 2024 financial year, a year earlier than previously expected.

• Major projects are summarised below:

Commodity	Project and ownership	Project scope / capacity	Capital expenditure US$M		Date of initial production	Progress / comments
			Budget		Target
Potash	Jansen Stage 1 (Canada) 100%	Design, engineering and construction of an underground potash mine and surface infrastructure, with capacity to produce 4.35 Mtpa.		5,723	End-CY26	Project is 16% complete.

• We continue to progress with the implementation of autonomous trucks across our operations.

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Release

• At the Goonyella Riverside and Daunia coal mines in Queensland, all BMA operated haul trucks are now autonomous.

• At South Flank in Western Australia, the project to automate the current fleet of 41 Komatsu haul trucks commenced in the June 2022 quarter and is expected to be completed by the end of the 2023 calendar year. Studies are underway for deployment at Newman West and Mining Area C.

• After the successful implementation of autonomous drills at both Escondida and Spence, the deployment of autonomous trucks has commenced with four trucks at Spence and is planned to expand to 33 trucks. At Escondida, autonomous trucks are scheduled to commence deployment during the 2024 financial year.

Operations Services

Operations Services (OS) performs business critical services across our operations in Australia, including maintaining a significant portion of ultra-class trucks and moving significant volumes of material as part of production services. At 31 December 2022, OS was responsible for maintaining 43 per cent of BHP’s haul trucks across Minerals Australia, including 95 per cent of ultra-class trucks at BMA, and the 308 km of conveyors in our WAIO operations.

The BHP FutureFit Academy, launched in May 2020, has welcomed over 600 students and graduated over 300 apprentices and maintenance associates during this period at its facilities in Perth in Western Australia and Mackay in Queensland. Of the graduates, 85 per cent are female, 23 per cent identify as Indigenous and the majority are new to industry.

Outlook

ix

Economic outlook

Population growth, rising living standards, and the infrastructure required for decarbonisation are all expected to drive demand for steel,

non-ferrous

metals and fertilisers for decades to come.

In the near term, BHP’s operating environment is expected to remain volatile. Growth momentum is expected to slow substantially across the developed world as the impact of anti-inflationary policies progressively bites. On the other hand, after a difficult time in the first half of the 2023 financial year, China appears set to serve as a source of stability for commodity demand, with major headwinds in the process of being removed and tailwinds likely to progressively emerge in their place.

Inflationary trends diverged over the last six months, as expected.

Non-energy

raw materials, logistics and manufacturing supply chain pressures eased, while energy and labour cost concerns were consistently elevated. The lag effect of inflation and continued labour market tightness are expected to impact our cost base into the 2024 financial year. Exchange rates have adjusted rapidly against the evolving macroeconomic backdrop, with US dollar strength having provided a partial offset for local currency cost inflation in our major operating jurisdictions.

Overall, and despite the easing inflationary pulse across many cost categories, the marginal cost of mining production is now estimated to be markedly higher than it was prior to the

COVID-19

pandemic. This implies that price support is also expected to be higher than in previous cycles and

low-cost

operators stand to capture higher relative margins in certain commodities.

Commodities review and outlook

Global

steel

production was mixed in the first half of the 2023 financial year, with unconvincing growth in China, solid conditions in India and outright declines across developed regions, led by Europe and the conflict-constrained Commonwealth of Independent States. Steelmakers across all regions saw their margins squeezed, with lower sale prices intersecting with high input costs.

Ex-China

steel markets are expected to remain under pressure as the general industrial climate softens. India, in the

lead-up

to next year’s general election, may prove to be an exception. While improved

end-use

demand conditions are anticipated in China, the extent to which that will flow through to improved profitability for mills (thereby influencing raw materials quality differentials) is uncertain.

The

iron ore

market spent much of the first half of the 2023 financial year at or slightly above real-time cost support in the

US$80-US$100/t

CFR range. The price moved above that range late in the period, on the expectation that demand conditions would firm in China on the back of

pro-growth

policies. Chinese port stocks are roughly 25 Mt lower than they were a year ago, with both low and high-cost seaborne supply having underperformed (in aggregate) across the 2022 calendar year. In the medium term, China’s demand for iron ore is expected to be lower than it is today as crude steel production plateaus and the

scrap-to-steel

ratio rises. In the long term, prices are expected to be determined by high-cost production, on a

value-in-use

adjusted basis, from Australia or Brazil. It is imperative that we continue to compete on both product quality and as a

low-cost

producer.

8

BHP Results for the half year ended 31 December 2022

Metallurgical coal

prices were less volatile in the first half of the 2023 financial year than in the prior half, as the seaborne trade progressively adjusted to the shock of the Russian invasion of Ukraine. On the demand side,

ex-China

pig iron production was weak, driven by output cuts in Europe and Northeast Asia. Conditions remained tight on the supply side; adverse weather conditions in Australia and Canada and the diversion of some metallurgical coal to power generation under record high energy coal pricing offered some support to the market. Longer term, we believe that higher quality metallurgical coals will continue to be required in blast furnace steel making for decades, driven by the growth of the steel industry in hard coking coal importing countries such as India. Premium Hard Coking Coals are expected to be valued for their role in reducing the greenhouse gas emissions intensity of blast furnaces. With the major seaborne supply region of Queensland having become less conducive to long-life capital investment as a result of changes to the royalty regime, the scarcity value of such coals may well increase over time. China’s import policy remains a source of uncertainty.

Copper

prices fell sharply late in the second half of the 2022 financial year as demand risks in the developed world mounted. Prices then traded in a well-defined range for much of the first half of the 2023 financial year, with $7,000/t being the approximate floor. Low visible inventories and below-average industry-wide supply performance prevented prices from falling further. Global demand growth is expected to be modest in aggregate, with improvement in China offsetting weakness in the OECD. Notwithstanding the fact that revisions to industry production guidance have generally been to the downside of late, we expect modest near-term demand to be well covered by a combination of rising primary and scrap supply. Longer term, traditional

end-use

demand is expected to be solid and the electrification mega-trend offers attractive upside. In terms of meeting that demand, we anticipate that the cost curve is likely to steepen as geological inflation, social value expectations, above ground risks, decarbonisation and water challenges are progressively heightened.

Nickel

prices have been volatile over the first half of the 2023 financial year, although not to the same extent as in the immediate aftermath of the Russian invasion of Ukraine. Tight fundamentals in the

Class-1

segment remain in place, exemplified by the persistence of very low exchange inventories. Offsetting that, demand risks have weighed heavily on investor sentiment. Meanwhile, other classes of nickel supply have been ramping up quickly in Indonesia, which has resulted in large spreads between

Class-1

nickel priced on the LME and other nickel products and intermediates priced in China, where surpluses have been evident. Longer term, we believe nickel will be a core beneficiary of the electrification mega-trend and that nickel sulphides will be particularly attractive.

Potash

prices have declined steadily throughout the first half of the 2023 financial year as affordability deteriorated, unwinding the steep price spike that developed in the wake of Belarusian sanctions and the invasion of Ukraine. Longer term, potash stands to benefit from the intersection of global megatrends: rising population, changing diets and the need for the sustainable intensification of agriculture on finite arable land. The compelling demand picture, geopolitical uncertainty and the maturity of the existing asset base offers an attractive entry opportunity in a lower-risk supply jurisdiction such as Saskatchewan, Canada.

The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 1.

Portfolio

The commodities we produce are essential for global economic growth and the world’s ability to transition to and thrive in a low carbon future. Our existing portfolio is built upon an industry leading set of large, low cost and expandable resource bases, which generates attractive and consistent returns.

We have simplified and strengthened our portfolio in recent years. However, as the world continues to evolve towards a lower carbon future, we must actively manage our portfolio to mitigate the risks that a changing world presents and to take advantage of opportunities to grow value.

9

Release

Given our strategy to focus our coal portfolio on the highest quality metallurgical coals, BHP and Mitsubishi Development Pty Ltd, 50:50 joint venture partners in BMA, have started to pursue options to divest the Daunia and Blackwater mines following detailed considerations of BMA’s longer-term plans. Whilst high quality assets with growth potential, the Daunia and Blackwater mines would struggle to compete for capital under our capital allocation framework, including given our choices for deploying capital globally, and we are seeking to divest these assets to an operator who is more likely to prioritise the necessary investments for continued successful operation. We will look to maximise the value of these assets via trade sale.

In June 2022, BHP announced its decision to retain NSWEC in our portfolio, seek the relevant approvals to continue mining beyond its current mining consent that expires in 2026 and proceed with a managed process to cease mining at the asset by the end of the 2030 financial year. The 2030 consent modification approval process is progressing, and includes preparation of relevant studies and documentation, as well as ongoing engagement with key regulatory authorities and community stakeholders. The consent modification we are seeking is to allow time for stakeholder consultation for a just transition and is expected to carry conditions which prevent new infrastructure or production growth. As a result, over the period to 2030, we will not be allocating any growth capital to NSWEC and production is expected to remain broadly in line with current levels of 13 to 15 Mtpa. In light of the NSW Government announcement on potential changes to its coal price cap and domestic reservation requirements, we are actively reviewing operational plans, existing commitments and logistical practicalities to understand their implications. Further, it is important to note that NSWEC’s current unit cost of production is above the NSW Governments’ proposed price cap of A$125 per tonne.

In December 2022, BHP announced the signing of a Scheme Implementation Deed (SID) with OZ Minerals Ltd (OZL) to acquire 100 per cent of OZL through a scheme of arrangement for a cash price of A$28.25 per OZL share less the amount of any dividends declared and paid by OZL prior to implementation (Scheme). This corresponds to an enterprise value of A$9.8 billion

ii

for OZL. The SID confirms the terms of the Scheme and BHP’s

non-binding

indicative proposal announced on 18 November 2022. The implementation of the Scheme is subject to satisfaction of certain conditions including OZL shareholder and Australian court approval and receipt of approvals from regulators in relevant jurisdictions (including Brazil, now received, and Vietnam). The OZL Board has unanimously recommended that OZL shareholders vote in favour of the Scheme in the absence of a superior proposal and subject to an independent expert concluding that the Scheme is in the best interests of OZL shareholders.

Income statement

In discussing the underlying financial performance of our business, we focus on

non-IFRS

financial information measures that we refer to as underlying attributable profit, underlying attributable profit – Continuing operations, underlying EBIT and underlying EBITDA.

Underlying attributable profit allows the comparability of underlying financial performance by excluding the impacts of exceptional items.

3

Underlying attributable profit is calculated by excluding any exceptional items attributable to BHP shareholders from profit after taxation from Continuing and Discontinued operations attributable to BHP shareholders.

Underlying attributable profit – Continuing operations allows the comparability of underlying financial performance by excluding the impacts of exceptional items and the profit/(loss) after taxation of Discontinued operations attributable to BHP shareholders and is also the basis on which our dividend payout ratio policy is applied. Underlying attributable profit from Continuing operations excludes the contribution of Discontinued operations from underlying attributable profit.

Underlying EBIT is used to help assess current operational profitability excluding net finance costs and taxation expense (each of which are managed at the Group level) as well as Discontinued operations and any exceptional items. Underlying EBIT is calculated as earnings before net finance costs, taxation expense, Discontinued operations and any exceptional items. Underlying EBIT includes BHP’s share of profit/(loss) from investments accounted for using the equity method including net finance costs and taxation expense/(benefit).

3  Exceptional items are those gains or losses where their nature, including the expected frequency of the events giving rise to them, and impact is considered material to the Group’s financial statements. Refer to page 13 and to note 2 ‘Exceptional items’ and note 9 ‘Significant events – Samarco dam failure’ of the Financial Report for further information.

10

BHP Results for the half year ended 31 December 2022

Underlying EBITDA is used to help assess current operational profitability excluding the impacts of sunk costs (

i.e.

, depreciation from initial investment) and is a measure that management uses internally to assess the performance of the Group’s segments and make decisions on the allocation of resources. Underlying EBITDA is calculated as earnings before net finance costs, depreciation, amortisation and impairments, taxation expense, Discontinued operations and exceptional items. Underlying EBITDA includes BHP’s share of profit/(loss) from investments accounted for using the equity method including net finance costs, depreciation, amortisation and impairments and taxation expense/(benefit).

The following table reconciles underlying attributable profit to profit after taxation attributable to BHP shareholders:

Half year ended 31 December	2022 US$M		2021 US$M
Profit after taxation attributable to BHP shareholders		6,457		9,443
Total exceptional items attributable to BHP shareholders 1		140		1,244
Underlying attributable profit		6,597		10,687
Profit after taxation attributable to members of BHP for Discontinued operations		–		(972	)
Underlying attributable profit – Continuing operations		6,597		9,715
Weighted basic average number of shares (million)		5,064		5,061
Underlying basic earnings per ordinary share – Continuing operations (US cents)		130.3		192.0

1 Refer to page 13 and to note 2 ‘Exceptional items’ and note 9 ‘Significant events – Samarco dam failure’ of the Financial Report for further information.

The following table reconciles Underlying EBITDA to profit from operations:

Half year ended 31 December	2022 US$M			2021 US$M
Profit from operations		10,833			14,845
Exceptional items included in profit from operations 1		(80	)		729
Underlying EBIT		10,753			15,574
Depreciation and amortisation expense		2,456			2,851
Net impairments		21			38
Underlying EBITDA		13,230			18,463

1 Exceptional items profit of US$80 million excludes net finance costs of US$222 million related to the Samarco dam failure. Refer to page 13 and to note 2 ‘Exceptional items’ and note 9 ‘Significant events – Samarco dam failure’ of the Financial Report for further information.

11

Release

The following table and commentary describe the impact of the principal factors

i

that affected Underlying EBITDA for the December 2022 half year compared with the December 2021 half year:

	US$M
Half year ended 31 December 2021		18,463
Net price impact:
Change in sales prices		(3,549	)	Lower average realised prices for iron ore, copper, and hard coking coal, partially offset by higher average realised prices for weak coking coal, thermal coal and nickel.
Price-linked costs		(333	)	Net increase in royalties reflecting impacts of the increased Queensland Government royalty rates and higher realised prices for thermal coal partially offset by lower royalties for iron ore as a result of lower realised prices, combined with higher third party concentrate purchase costs due to higher nickel prices.
		(3,882	)
Change in volumes		704		Increased volumes at: Olympic Dam as a result of strong concentrator and smelter performance, and the planned major smelter maintenance campaign (SCM21) in the prior period; Escondida due to higher concentrator feed grade; WAIO record half year production as a result of continued strong supply chain performance and increased lump sales driven by the continued ramp up of South Flank; and BMA driven by improved truck productivity, partially offset by the deferral of concentrate sales at Spence following a fire at Port Mejillones and decreased volumes at NSWEC as a result of record rainfall.
Change in controllable cash costs		(517	)	Largely due to the unfavourable impacts of inventory movements: at WAIO, to support supply chain performance amidst lower labour availability (US$241 million); and at Olympic Dam, following a stock build during SCM21 in the prior period (US$165 million). Higher one-off contractor costs and higher consumable costs at Escondida and Spence. Higher costs at BMA resulted from the production impacts of significant wet weather.
Change in other costs:
Exchange rates		394		Impact of movements in the Australian dollar and Chilean peso against the US dollar.
Inflation		(663	)	Impact of significant increases in global inflation rates on the Group’s cost base.
Fuel, energy, and consumable price movements		(383	)	Predominantly higher diesel and explosives prices.
Non-cash		(17	)
		(669	)
Asset sales		6
Ceased and sold operations		(470	)	Predominantly the contribution of BMC prior to divestment of our 80% interest on 3 May 2022.
Other items		(405	)	Other includes the recovery of lower freight costs caused by movements in the freight index on consecutive voyage charter (CVC) voyages and lower profit at Antamina largely driven by lower realised copper prices.
Half year ended 31 December 2022		13,230

Prices and exchange rates

The average realised prices achieved for our major commodities are summarised in the following table:

									H1 FY23			H1 FY23			H1 FY23
									vs			vs			vs
Average realised prices 1	H1 FY23		H1 FY22		H2 FY22		FY22		H1 FY22			H2 FY22			FY22
Copper (US$/lb)		3.49		4.31		4.02		4.16		(19	%)		(13	%)		(16	%)
Iron ore (US$/wmt, FOB)		85.46		113.54		112.65		113.10		(25	%)		(24	%)		(24	%)
Metallurgical coal (US$/t)		268.73		259.71		423.82		347.10		3	%		(37	%)		(23	%)
Hard coking coal (HCC) (US$/t) 2		270.65		278.60		437.60		366.82		(3	%)		(38	%)		(26	%)
Weak coking coal (WCC) (US$/t) 2		252.12		218.65		382.56		296.51		15	%		(34	%)		(15	%)
Thermal coal (US$/t) 3		354.30		137.68		302.60		216.78		157	%		17	%		63	%
Nickel metal (US$/t)		24,362		19,651		27,399		23,275		24	%		(11	%)		5	%

1 Based on provisional, unaudited estimates. Prices exclude sales from equity accounted investments, third party product and internal sales, and represent the weighted average of various sales terms (for example: FOB, CIF and CFR), unless otherwise noted. Includes the impact of provisional pricing and finalisation adjustments.

2 Hard coking coal (HCC) refers generally to those metallurgical coals with a Coke Strength after Reaction (CSR) of 35 and above, which includes coals across the spectrum from Premium Coking to Semi Hard Coking coals, while weak coking coal (WCC) refers generally to those metallurgical coals with a CSR below 35.

3 Includes thermal coal sales from metallurgical coal mines

In copper, the provisional pricing and finalisation adjustments decreased Underlying EBITDA by US$59 million in the December 2022 half year and are included in the average realised copper price in the above table.

12

BHP Results for the half year ended 31 December 2022

The following exchange rates relative to the US dollar have been applied in the financial information:

	Average Half year ended 31 December 2022		Average Half year ended 31 December 2021		As at 31 December 2022		As at 31 December 2021		As at 30 June 2022
Australian dollar 1		0.67		0.73		0.68		0.73		0.69
Chilean peso		920		798		860		845		920

1 Displayed as US$ to A$1 based on common convention.

Depreciation, amortisation and impairments

Depreciation, amortisation and impairments excluding exceptional items decreased by US$412 million to US$2.5 billion, mainly reflecting lower depreciation and amortisation at WAIO driven by the increase in Yandi mine life, the revaluation of price-linked right of use assets, and the divestment of our interest in BMC in the 2022 financial year.

Net finance costs

Net finance costs increased by US$300 million to US$652 million primarily due to the impact of higher inflation on the closure and rehabilitation provisions.

Taxation expense

	2022							2021
Half year ended 31 December	Profit before taxation US$M		Income tax expense US$M			%		Profit before taxation US$M		Income tax expense US$M			%
Statutory effective tax rate		10,181		(3,055	)		30.0		14,493		(4,959	)		34.2
Adjusted for:
Exchange rate movements		–		11					–		(91	)
Exceptional items 1		142		(2	)				822		422
Adjusted effective tax rate i		10,323		(3,046	)		29.5		15,315		(4,628	)		30.2

1 Refer exceptional items below for further details.

The Group’s statutory effective tax rate was 30% for the half year ended December 31, 2022 and 34.2% for the half year ended December 31, 2021. The Group’s adjusted effective tax rate, which excludes the impact of exchange rate movements and exceptional items, was 29.5 per cent (31 December 2021: 30.2 per cent). The Group’s adjusted effective tax rate was lower than at 31 December 2021 primarily due to lower withholding taxes and lower overall Chilean mining tax reflecting lower operating margins. The adjusted effective tax rate for the 2023 financial year is expected to be in the range of 30 to 35 per cent.

Royalty arrangements which are not profit based are recognised as operating costs within Profit before taxation. These increased to US$1.8 billion during the period (31 December 2021: US$1.7 billion), despite a lower price environment, largely reflecting the increase in Queensland Government royalty rates from 1 July 2022.

Exceptional items

The following table sets out the exceptional items for the December 2022 half year. Exceptional items are those gains or losses where their nature, including the expected frequency of the events giving rise to them, and impact is considered material to the Group’s financial statements. Additional commentary is included on

page F-8.

Half year ended 31 December 2022	Gross US$M			Tax US$M		Net US$M
Exceptional items by category
Samarco dam failure		(142	)		2		(140	)
Total		(142	)		2		(140	)
Attributable to non-controlling interests		–			–		–
Attributable to BHP shareholders		(142	)		2		(140	)

13

Release

Debt management and liquidity

During the December 2022 half year, gross debt decreased by US$1.7 billion to US$14.7 billion at 31 December 2022. This decrease includes a EUR0.4 billion repayment of 0.75 per cent EUR senior notes that matured on 28 October 2022 and a GBP0.6 billion repayment of 6.50 per cent GBP hybrid security notes that were called with an early redemption date on 22 October 2022. The reduction also includes US$0.7 billion of foreign exchange and interest rate adjustments.

At the subsidiary level, Escondida refinanced US$0.3 billion of long-term debt that was due to mature in the period and increased the term loan facility to US$0.5 billion, of which $0.1 billion remains undrawn as at 31 December 2022.

BHP continues to hold a robust liquidity position with US$9.6 billion in cash and cash equivalents. The Group also has a US$5.5 billion commercial paper program backed by a US$5.5 billion revolving credit facility. As at 31 December 2022, the Group had no outstanding commercial paper and no drawn amount under the revolving credit facility.

In February 2023, BHP entered into a fully underwritten US$5.0 billion new loan facility, which is available to be drawn down to support the potential acquisition of OZ Minerals.

Dividend

The BHP Board determined to pay an interim dividend of 90 US cents per share (US$4.6 billion). The interim dividend will be fully franked for Australian taxation purposes.

BHP’s Dividend Reinvestment Plan (DRP) will operate in respect of the interim dividend.

Corporate governance

John Mogford retired from the Board effective 31 October 2022 and Malcolm Broomhead retired from the Board following the 2022 Annual General Meeting on 10 November 2022.

The current members of the Board’s committees are:

Risk and Audit Committee	Nomination and Governance Committee	Remuneration Committee	Sustainability Committee
Terry Bowen (Chair) Xiaoqun Clever Ian Cockerill Michelle Hinchliffe Christine O’Reilly	Ken MacKenzie (Chair) Terry Bowen Gary Goldberg (SID) 1 Christine O’Reilly	Christine O’Reilly (Chair) Catherine Tanna Dion Weisler	Gary Goldberg (SID) (Chair) Ian Cockerill Catherine Tanna Dion Weisler

1 Senior Independent Director (SID).

14

BHP Results for the half year ended 31 December 2022

Segment summary

1

A summary of performance for the December 2022 and December 2021 half years is presented below.

Half year ended 31 December 2022 US$M	Revenue 2		Underlying EBITDA 3		Underlying EBIT 3			Exceptional items 4			Net operating assets 3		Capital expenditure		Exploration gross 5		Exploration to profit 6
Copper		7,305		2,814		1,938			109			28,132		1,191		61		61
Iron Ore		11,822		7,641		6,657			2			17,334		812		50		26
Coal		5,566		2,631		2,294			–			7,206		237		4		1
Group and unallocated items 7		1,020		144		(136	)		(31	)		3,563		631		41		39
Inter-segment adjustment		–		–		–			–			–		–		–		–
Total Group		25,713		13,230		10,753			80			56,235		2,871		156		127
Half year ended 31 December 2021 US$M	Revenue 2		Underlying EBITDA 3		Underlying EBIT 3			Exceptional items			Net operating assets 3		Capital expenditure		Exploration gross 5		Exploration to profit 6
Copper		8,494		4,272		3,377			(212	)		27,647		1,275		34		34
Iron Ore		15,818		11,153		9,991			(512	)		17,997		814		51		30
Coal		5,368		2,642		2,235			–			7,856		313		8		2
Group and unallocated items 7		847		396		(29	)		(5	)		3,123		366		17		14
Inter-segment adjustment		–		–		–			–			–		–		–		–
Total Group		30,527		18,463		15,574			(729	)		56,623		2,768		110		80

1 Group and segment level information is reported on a statutory basis which reflects the application of the equity accounting method in preparing the Group financial statements – in accordance with IFRS. Underlying EBITDA of the Group and the reportable segments, includes depreciation, amortisation and impairments (D&A), net finance costs and taxation expense of US$244 million (H1 FY22: US$300 million) related to equity accounted investments. It excludes exceptional items profit of US$127 million (H1 FY22: US$702 million loss) related to share of profit/loss from equity accounted investments, related impairments and expenses.

Group profit before taxation comprises Underlying EBITDA, exceptional items, depreciation, amortisation and impairments of US$2,397 million (H1 FY22: US$3,618 million) and net finance costs of US$652 million (H1 FY22: US$352 million).

2 Revenue is based on Group realised prices and includes third party products. Sale of third party products by the Group contributed revenue of US$1,007 million and Underlying EBITDA of US$8 million (H1 FY22: US$1,674 million and US$10 million).

3 For more information on the reconciliation of non-IFRS financial information to our statutory measures, reasons for usefulness and calculation methodology, please refer to non-IFRS financial information set on pages R-1 to R-13.

4 Exceptional items profit of US$80 million excludes net finance costs of US$222 million included in the total loss before taxation of US$142 million related to the Samarco dam failure. Refer to note 2 ‘Exceptional items’ and note 9 ‘Significant events – Samarco dam failure’ of the Financial Report for further information.

5 Includes US$29 million capitalised exploration (H1 FY22: US$30 million).

6 Includes US$ nil of exploration expenditure previously capitalised, written off as impaired (included in depreciation and amortisation) (H1 FY22: US$ nil).

7 Group and unallocated items includes functions, other unallocated operations including Potash, Nickel West, legacy assets, and consolidation adjustments. Revenue not attributable to reportable segments comprises the sale of freight and fuel to third parties, as well as revenues from unallocated operations. Exploration and technology activities are recognised within relevant segments.

Half year ended 31 December 2022 US$M	Revenue		Underlying EBITDA 3			D&A		Underlying EBIT 3			Net operating assets 3		Capital expenditure		Exploration gross		Exploration to profit
Potash		–		(87	)		1		(88	)		4,008		325		–		–
Nickel West		1,010		99			49		50			1,100		267		26		24

Half year ended 31 December 2021 US$M	Revenue		Underlying EBITDA 3			D&A		Underlying EBIT 3			Net operating assets 3		Capital expenditure		Exploration gross		Exploration to profit
Potash		–		(63	)		1		(64	)		3,283		158		–		–
Nickel West		838		118			39		79			498		169		14		12

15

Release

Copper

Underlying EBITDA for the December 2022 half year decreased by US$1.5 billion to US$2.8 billion from US$4.3 billion in the prior period.

	US$M
Underlying EBITDA for the half year ended 31 December 2021		4,272
Net price impact:
Change in sales prices		(1,275	)	Lower average realised price: Copper US$3.49/lb (H1 FY22: US$4.31/lb).
Price-linked costs		9
Change in volumes		639		Higher volumes at Escondida due to higher concentrator feed grade (H1 FY23: 0.79%, H1 FY22: 0.72%), partly offset by lower concentrator throughput and the impact of road blockades across Chile, which reduced availability of some key mine supplies. At Spence, despite higher production due to the improved operational performance at the Spence Growth Option (SGO), concentrate sales volumes were lower due to a fire at the non-operated Port Mejillones in October 2022, which resulted in the deferral of some shipments into the June 2023 half year. Higher volumes at Olympic Dam as a result of strong concentrator and smelter performance, and the planned major smelter maintenance campaign (SCM21) in the prior period
Change in controllable cash costs		(292	)	At Olympic Dam, higher costs largely reflected impacts of an inventory drawdown following a stock build during SCM21 in the prior period. Higher costs at Escondida and Spence primarily reflected one-off contractor costs and higher consumables costs. Costs at Cerro Colorado increased as ore inventories were utilised ahead of planned closure at the end of the 2023 calendar year.
Change in other costs:
Exchange rates		45
Inflation		(305	)
Fuel, energy, and consumable price movement		(92	)	Higher diesel, explosives and acid prices, partially offset by lower power prices at Escondida due to the transition to renewable energy.
Non-cash		11
Other items		(198	)	Other includes lower profit at Antamina, largely driven by lower realised copper prices.
Underlying EBITDA for the half year ended 31 December 2022		2,814

Escondida unit costs increased by 12 per cent to US$1.44 per pound, at realised exchange rates. This reflects inflationary pressures, in particular for diesel, acid and explosives. It also reflects lower

by-product

credits, as a result of lower realised gold and silver prices. These increases were partially offset by an increase in volumes in the period and lower power prices at Escondida due to the transition towards 100 per cent renewable energy.

For the 2023 financial year, unit costs at Escondida are tracking towards the upper end of full year guidance of between US$1.25 and US$1.45 per pound (at a guidance exchange rate of USD/CLP 830). This is due to volumes tracking towards the low end of Escondida’s production guidance range as a result of lower than expected concentrator feed grade and throughput. In the medium term, we continue to expect unit costs to be less than US$1.15 per pound (based on an exchange rate of USD/CLP 830).

Escondida unit costs (US$M)	H1 FY23		H2 FY22		H1 FY22		FY22
Revenue		4,089		4,671		4,829		9,500
Underlying EBITDA		2,160		3,074		3,124		6,198
Gross costs		1,929		1,597		1,705		3,302
Less: by-product credits		190		216		214		430
Less: freight		110		127		103		230
Net costs		1,629		1,254		1,388		2,642
Sales (kt)		512		514		487		1,001
Sales (Mlb)		1,129		1,132		1,074		2,206
Cost per pound (US$) 1		1.44		1.11		1.29		1.20

1 H1 FY23 based on average exchange rates of USD/CLP 920.

At Spence, we continue to closely monitor previously identified Tailings Storage Facility (TSF) anomalies. We have reduced the volume of water in the tailings facility and continue to work with the local regulatory agencies, including on the implementation of a remediation plan for the TSF. The SGO concentrator continues to operate with no impact to production or market guidance. Spence is expected to reach an average of approximately 270 ktpa of production for four years (including cathodes) following the completion of the SGO plant modifications and remediation of TSF anomalies. Expected capital expenditure for the SGO plant modifications works remains unchanged at approximately US$100 million. Further studies are ongoing for additional capacity uplift at SGO. Cerro Colorado continues to transition towards planned closure at the end of the 2023 calendar year.

16

BHP Results for the half year ended 31 December 2022

Financial information for Copper for the December 2022 and December 2021 half years is presented below.

Half year ended 31 December 2022 US$M	Revenue				Underlying EBITDA			D&A			Underlying EBIT			Net operating assets		Capital expenditure			Exploration gross			Exploration to profit
Escondida 1		4,089				2,160			423			1,737			12,103		605
Pampa Norte 2		1,094				298			248			50			4,693		307
Antamina 3		752				432			89			343			1,417		204
Olympic Dam		1,133				259			197			62			9,911		270
Other 3,4		1				(99	)		9			(108	)		8		9
Total Copper from Group production		7,069				3,050			966			2,084			28,132		1,395
Third party products		988				8			–			8			–		–
				��
Total Copper		8,057				3,058			966			2,092			28,132		1,395			64			61
Adjustment for equity accounted investments 5		(752	)			(244	)		(90	)		(154	)		–		(204	)		(3	)		–
Total Copper statutory result		7,305				2,814			876			1,938			28,132		1,191			61			61
Half year ended 31 December 2021 US$M	Revenue				Underlying EBITDA			D&A			Underlying EBIT			Net operating assets		Capital expenditure			Exploration gross			Exploration to profit
Escondida 1		4,829				3,124			461			2,663			11,826		419
Pampa Norte 2		1,375				760			234			526			4,779		321
Antamina 3		932				679			72			607			1,366		176
Olympic Dam		652				90			193			(103	)		9,638		520
Other 3,4		1				(91	)		8			(99	)		38		15
Total Copper from Group production		7,789				4,562			968			3,594			27,647		1,451
Third party products		1,637				10			–			10			–		–
Total Copper		9,426				4,572			968			3,604			27,647		1,451			39			39
Adjustment for equity accounted investments 5		(932	)			(300	)		(73	)		(227	)		–		(176	)		(5	)		(5	)
Total Copper statutory result		8,494				4,272			895			3,377			27,647		1,275			34			34

1 Escondida is consolidated under IFRS 10 and reported on a 100 per cent basis.

2 Includes Spence and Cerro Colorado.

3 Antamina, SolGold and Resolution are equity accounted investments and their financial information presented above with the exception of net operating assets reflects BHP Group’s share.

4 Predominantly comprises divisional activities, greenfield exploration and business development. Includes Resolution and SolGold.

5 Total Copper statutory result revenue excludes US$752 million (H1 FY22: US$932 million) revenue related to Antamina. Total Copper statutory result Underlying EBITDA includes US$90 million (H1 FY22: US$73 million) D&A and US$154 million (H1 FY22: US$227 million) net finance costs and taxation expense related to Antamina, Resolution and SolGold that are also included in Underlying EBIT. Total Copper Capital expenditure excludes US$204 million (H1 FY22: US$176 million) related to Antamina. Exploration gross excludes US$3 million (H1 FY22: US$5 million) related to SolGold of which US$ nil million (H1 FY22: US$5 million) was expensed.

17

Release

Iron Ore

Underlying EBITDA for the December 2022 half year decreased by US$3.5 billion to US$7.6 billion from US$11.1 billion in the prior period.

	US$M
Underlying EBITDA for the half year ended 31 December 2021		11,153
Net price impact:
Change in sales prices		(3,665	)	Lower average realised price: Iron ore US$85.46/wmt, FOB (H1 FY22: US$113.54/wmt, FOB).
Price-linked costs		271		Lower royalties in line with lower prices.
Change in volumes		116		Record half year production resulting from continued strong supply chain performance, a higher portion of lump driven by the continued ramp up of South Flank and COVID-19 related impacts in the prior period.
Change in controllable cash costs		(115	)	Draw down of inventory stockpiles at the mines to support supply chain performance amidst lower labour availability, partially offset by lower demurrage costs driven by an easing of COVID-19 requirements at the port.
Change in other costs:
Exchange rates		120
Inflation		(185	)
Fuel, energy, and consumable price movement		(112	)	Predominantly higher diesel prices.
Other items		58		Other includes the write-off of dormant stockpiles in the prior period, partially offset by other items.
Underlying EBITDA for the half year ended 31 December 2022		7,641

WAIO unit costs increased by 13 per cent to US$18.30 per tonne at realised exchange rates (US$15.50 per tonne on a C1 basis excluding third party royalties

1

, an increase of five per cent), primarily due to the impact of inflation, particularly for diesel, and the drawdown of mine inventories as a result of labour availability. This was partially offset by lower price-linked third party royalties and favourable exchange rate movements.

Full year unit cost guidance for the 2023 financial year remains unchanged at between US$18 and US$19 per tonne (based on an exchange rate of AUD/USD 0.72) and is tracking towards the upper end. In the medium term, we expect to lower our unit costs to less than US$17 per tonne (based on an exchange rate of AUD/USD 0.72) reflecting ongoing improvements across the supply chain.

WAIO unit costs (US$M)	H1 FY23		H2 FY22		H1 FY22		FY22
Revenue		11,756		14,882		15,750		30,632
Underlying EBITDA		7,623		10,561		11,227		21,788
Gross costs		4,133		4,321		4,523		8,844
Less: freight 2		1,020		1,098		1,399		2,497
Less: royalties		793		1,065		1,069		2,134
Net costs		2,320		2,158		2,055		4,213
Sales (kt, equity share)		126,753		123,467		127,221		250,688
Cost per tonne (US$) 3		18.30		17.48		16.15		16.81
Cost per tonne on a C1 basis excluding third party royalties (US$) 1		15.50		15.39		14.74		15.05

1 Excludes third party royalties of US$1.52 per tonne (H1 FY22: US$1.84 per tonne), net inventory movements US$0.57 per tonne (H1 FY22: US$(0.76) per tonne), depletion of production stripping US$0.84 per tonne (H1 FY22: US$0.61 per tonne) and exploration expenses, marketing purchases, demurrage, exchange rate gains/losses, and other income US$(0.14) per tonne (H1 FY22: US$(0.28) per tonne).

2 Lower H1 FY23 freight costs with the easing of COVID-19 restrictions reducing global supply chain pressures and freight rates.

3 H1 FY23 based on an average exchange rate of AUD/USD 0.67.

18

BHP Results for the half year ended 31 December 2022

Financial information for Iron Ore for the December 2022 and December 2021 half years is presented below.

Half year ended 31 December 2022 US$M	Revenue		Underlying EBITDA			D&A		Underlying EBIT			Net operating assets			Capital expenditure		Exploration gross 1		Exploration to profit
Western Australia Iron Ore		11,756		7,623			972		6,651			20,669			805
Samarco 2		–		–			–		–			(3,294	)		–
Other 3		57		18			12		6			(41	)		7
Total Iron Ore from Group production		11,813		7,641			984		6,657			17,334			812
Third party products 4		9		–			–		–			–			–
Total Iron Ore		11,822		7,641			984		6,657			17,334			812		50		26
Adjustment for equity accounted investments		–		–			–		–			–			–		–		–
Total Iron Ore statutory result		11,822		7,641			984		6,657			17,334			812		50		26
Half year ended 31 December 2021 US$M	Revenue		Underlying EBITDA			D&A		Underlying EBIT			Net operating assets			Capital expenditure		Exploration gross 1		Exploration to profit
Western Australia Iron Ore		15,750		11,227			1,058		10,169			21,087			814
Samarco 2		–		–			–		–			(3,119	)		–
Other 3		59		(74	)		104		(178	)		29			–
Total Iron Ore from Group production		15,809		11,153			1,162		9,991			17,997			814
Third party products 4		9		–			–		–			–			–
Total Iron Ore		15,818		11,153			1,162		9,991			17,997			814		51		30
Adjustment for equity accounted investments		–		–			–		–			–			–		–		–
Total Iron Ore statutory result		15,818		11,153			1,162		9,991			17,997			814		51		30

1 Includes US$24 million of capitalised exploration (H1 FY22: US$21 million).

2 Samarco is an equity accounted investment and its financial information presented above, with the exception of net operating assets, reflects BHP Billiton Brasil Ltda’s share. All financial impacts following the Samarco dam failure have been reported as exceptional items in both reporting periods.

3 Predominantly comprises divisional activities, towage services, business development and ceased operations.

4 Includes inter-segment and external sales of contracted gas purchases.

19

Release

Coal

Underlying EBITDA for the December 2022 half year decreased by US$11 million to US$2.6 billion.

	US$M
Underlying EBITDA for the half year ended 31 December 2021		2,642
Net price impact:
Change in sales prices		1,201		Higher average prices: Thermal coal $354.30/t (H1 FY22: US$137.68/t); and Weak coking coal $252.12/t (H1 FY22: US$218.65/t); Partially offset by lower average prices: Hard coking coal $270.65/t (H1 FY22: US$278.60/t)
Price-linked costs		(545	)	Higher royalties as a result of the increased Queensland Government royalty rates combined with higher average realised prices for thermal coal.
Change in volumes		(40	)	Lower volumes at NSWEC largely as a result of record wet weather, continued labour shortages and an increased proportion of washed coal, partially offset by higher volumes at BMA, despite significant wet weather, driven by an improvement in underlying truck productivity, higher yields and reduced impact of labour constraints.
Change in controllable cash costs		(24	)	Unfavourable inventory movements at BMA, partially offset by favourable inventory movements at NSWEC.
Change in other costs:
Exchange rates		151
Inflation		(118	)
Fuel, energy, and consumable price movement		(137	)	Higher diesel, electricity and explosives prices at BMA and NSWEC.
Other items		(499	)	Predominantly the contribution of BMC prior to divestment of our 80% interest on 3 May 2022.
Underlying EBITDA for the half year ended 31 December 2022		2,631

BMA unit costs increased by five per cent to US$100 per tonne at realised exchange rates, primarily due to the impact of inflation, particularly higher diesel prices, and inventory movements following significant La Niña wet weather impacts. This was partially offset by favourable exchange rate movements.

Unit cost guidance for the 2023 financial year has been increased to between US$100 and US$105 per tonne (based on an exchange rate of AUD/USD 0.72) from between US$90 and US$100 per tonne, reflecting full year volumes tracking to the low end of production guidance due to significant wet weather, inventory movements and inflationary pressures.

BMA unit costs (US$M)	H1 FY23		H2 FY22		H1 FY22		FY22
Revenue		3,598		6,864		3,390		10,254
Underlying EBITDA		1,426		4,583		1,752		6,335
Gross costs		2,172		2,281		1,638		3,919
Less: freight		19		31		19		50
Less: royalties		799		881		401		1,282
Net costs		1,354		1,369		1,218		2,587
Sales (kt, equity share)		13,509		16,240		12,809		29,049
Cost per tonne (US$) 1		100.23		84.30		95.09		89.06

1 H1 FY23 based on an average exchange rate of AUD/USD 0.67

NSWEC unit costs increased by 49 per cent to US$101 per tonne at realised exchange rates, primarily due to lower volumes as a result of record wet weather and the focus on higher value coal products to capture the ~US$230 per tonne price differential between higher and lower calorific coals (H1 FY22: ~US$70 per tonne), increased price-linked port costs as a result of higher sales prices, and the impact of inflation, particularly for diesel. This was partially offset by favourable inventory and exchange rate movements.

Unit cost guidance for the 2023 financial year has been increased to between US$84 and US$91 per tonne (based on an exchange rate of AUD/USD 0.72) from between US$76 and US$86 per tonne, reflecting production impacts from record wet weather, inflationary pressures and price-linked logistics costs.

NSWEC unit costs (US$M)	H1 FY23		H2 FY22		H1 FY22		FY22
Revenue		1,968		2,008		1,026		3,034
Underlying EBITDA		1,234		1,372		435		1,807
Gross costs		734		636		591		1,227
Less: royalties		198		143		84		227
Net costs		536		493		507		1,000
Sales (kt, equity share)		5,303		6,626		7,498		14,124
Cost per tonne (US$) 1		101.07		74.40		67.62		70.80

1 H1 FY23 based on an average exchange rate of AUD/USD 0.67.

20

BHP Results for the half year ended 31 December 2022

Financial information for Coal for the December 2022 and December 2021 half years is presented below.

Half year ended 31 December 2022 US$M	Revenue 1			Underlying EBITDA			D&A			Underlying EBIT			Net operating assets			Capital expenditure		Exploration gross		Exploration to profit
BHP Mitsubishi Alliance		3,598			1,426			301			1,125			7,426			183
New South Wales Energy Coal 2		2,016			1,288			41			1,247			(209	)		50
Other 3		–			(29	)		8			(37	)		(11	)		4
Total Coal from Group production		5,614			2,685			350			2,335			7,206			237
Third party products		–			–			–			–			–			–
Total Coal		5,614			2,685			350			2,335			7,206			237		4		1
Adjustment for equity accounted investments 4		(48	)		(54	)		(13	)		(41	)		–			–		–		–
Total Coal statutory result		5,566			2,631			337			2,294			7,206			237		4		1
Half year ended 31 December 2021 US$M	Revenue 1			Underlying EBITDA			D&A			Underlying EBIT			Net operating assets			Capital expenditure		Exploration gross		Exploration to profit
BHP Mitsubishi Alliance		3,390			1,752			295			1,457			8,066			253
New South Wales Energy Coal 2		1,070			468			54			414			(212	)		23
Other 3,5		952			455			71			384			2			37
Total Coal from Group production		5,412			2,675			420			2,255			7,856			313
Third party products		–			–			–			–			–			–
Total Coal		5,412			2,675			420			2,255			7,856			313		8		2
Adjustment for equity accounted investments 4		(44	)		(33	)		(13	)		(20	)		–			–		–		–
Total Coal statutory result		5,368			2,642			407			2,235			7,856			313		8		2

1 Total revenue from thermal coal sales, including NSWEC and BHP’s share of BMA, was US$2,123 million (H1 FY22: US$1,175 million).

2 Newcastle Coal Infrastructure Group is an equity accounted investment and its financial information presented above with the exception of net operating assets reflects BHP Group’s share.

3 Predominantly comprises divisional activities and ceased operations.

4 Total Coal statutory result revenue excludes US$48 million (H1 FY22: US$44 million) revenue related to Newcastle Coal Infrastructure Group. Total Coal statutory result excludes US$54 million (H1 FY22: US$33 million) Underlying EBITDA, US$13 million (H1 FY22: US$13 million) D&A and US$41 million (H1 FY22: US$20 million) Underlying EBIT related to Newcastle Coal Infrastructure Group until future profits exceed accumulated losses.

5 The divestment of BHP’s 80% interest in BMC was completed on 3 May 2022. The Group’s share of BMC revenue, Underlying EBITDA, D&A, Underlying EBIT and Capital expenditure have been presented within ‘Other’. BMC’s assets and liabilities were classified as ‘Held For Sale’ at 31 December 2021 and were therefore excluded from Net Operating Assets (US$623 million).

21

Release

Greenfield exploration

BHP continued to strengthen its portfolio of options, including through an increased focus on exploration. Exploration expenditure during the December 2022 half year increased by 42 per cent to US$156 million.

Work continues on existing exploration projects, joint ventures and

farm-in

agreements, as well as leveraging technology to both look deeper in mature exploration jurisdictions and delineate new high potential search spaces globally.

We continue to progress exploration activity for copper in Australia, Canada, Chile, Ecuador, north-west Mexico, Peru and the south-west United States and initiated greenfield activities in southern Colombia. Nickel programs were also advanced in Canada and Australia.

At Oak Dam in South Australia, BHP is continuing resource definition drilling with six drill rigs to define the extent, continuity and variability of the mineralisation. Between May 2021 and December 2022, we completed approximately 40 km of drilling, with high-grade mineralised intercepts of copper, and associated gold, uranium and silver. Results continue to be encouraging, with multiple intervals ranging between 0.9 and 4.3 per cent copper identified by laboratory assay results consistent with intercepts previously reported in the September 2020 Operational Review. Mineralisation below cover remains open at the south and at depth. Our forward plan is to continue drilling and engage externally with key stakeholders including Traditional Owners, landholders, government and the community, with a view to converting the exploration licence to a retention lease, which will allow BHP to carry out further exploration activities.

Work continued on the

farm-in

agreement for the early-stage Elliott copper project in the Northern Territory, Australia, Initial drilling has identified some favourable geological features, with a field mapping and sampling program planned for the June 2023 quarter, following seasonal rains.

On 21 July 2022 we extended our strategic alliance with Midland Exploration to fund a new nickel exploration program in Nunavick, Quebec.

In August 2022, we announced the

establishment of BHP Xplor

, an innovative accelerator program to support

early-stage

mineral exploration companies to find critical resources for the energy transition, such as copper and nickel. The program merges concepts from venture capital and early-stage accelerators offering participants

in-kind

services, mentorship, and networking opportunities. Applications for the program closed on 31 October 2022 and we received a significant number of applications from around the world. We have selected seven companies into the inaugural accelerator program which began in January 2023 and is expected to run until the end of June 2023.

In October 2022, BHP agreed to invest an additional US$50 million (the second investment) in the Kabanga Nickel Project (Kabanga) in Tanzania. Following closing of that investment in February 2023, BHP’s interest in Kabanga increased to 14.3 per cent. In October 2022, BHP also signed an agreement with Kabanga Nickel Limited giving BHP the option to increase its interest in Kabanga to 51 per cent.

Following a review of prospectivity and core results, BHP acquired a 19.9 per cent interest via a placement in Brixton Metals, providing exposure to a large block of ground prospective for copper in northern British Columbia, Canada.

In January 2023, BHP signed an Option Agreement with Mundoro Capital, Inc. covering three exploration projects they currently hold in Serbia (Trstenik, Borsko and South Timok). This agreement provides BHP with the option to secure up to 100 per cent interest in the three copper exploration prospects over the next three years, depending on the exploration results.

Group and unallocated items

Underlying EBITDA for Group and unallocated items decreased by US$252 million to US$144 million in the December 2022 half year, primarily due to the recovery of lower freight costs caused by movements in the freight index on consecutive voyage charter (CVC) voyages of US$225 million.

Nickel West’s Underlying EBITDA decreased by US$19 million to US$99 million in the December 2022 half year. This reflects unfavourable inventory movements, the adverse impacts of the higher nickel price on third party concentrate purchase costs and the impact of inflation, particularly for diesel and ammonia. This was largely offset by higher prices and favourable exchange rate movements.

22

BHP Results for the half year ended 31 December 2022

Notes

The Financial Report set out on pages F-1 to F-22 for the half year ended 31 December 2022 has been prepared on the basis of accounting policies and methods of computation consistent with those applied in the 30 June 2022 financial statements contained within the Annual Report of the Group. This release including the Financial Report is unaudited. Variance analysis relates to the relative financial and/or production performance of BHP and/or its operations during the December 2022 half year compared with the December 2021 half year, unless otherwise noted. Operations includes operated and

non-operated

assets, unless otherwise noted. Medium term refers to our five year plan. Numbers presented may not add up precisely to the totals provided due to rounding.

The following abbreviations may have been used throughout this report: billion tonnes (Bt); cost and freight (CFR); cost, insurance and freight (CIF), carbon dioxide equivalent (CO

2

-e), dry metric tonne unit (dmtu); free on board (FOB); giga litres (GL); grams per tonne (g/t); high-potential injury (HPI); kilograms per tonne (kg/t); kilometre (km); metre (m); million ounces per annum (Mozpa); million pounds (Mlb); million tonnes (Mt); million tonnes per annum (Mtpa); ounces (oz); pounds (lb); thousand ounces (koz); thousand ounces per annum (kozpa); thousand tonnes (kt); thousand tonnes per annum (ktpa); thousand tonnes per day (ktpd); tonnes (t); total recordable injury frequency (TRIF); and wet metric tonnes (wmt).

The following footnotes apply to this Results Announcement:

i We use various non-IFRS financial information to reflect our underlying performance. For further information on the reconciliations of certain non-IFRS financial information measures to our statutory measures, reasons for usefulness and calculation methodology, please refer to non-IFRS financial information set out on pages R-1 to R-13.

ii Based on OZL’s fully diluted shares on issue of 337.0 million (inclusive of 2.1 million performance rights) as at 22 December 2022 and net debt of A$254 million as at 31 December 2022.

iii We use various key indicators to reflect our sustainability performance. For further information on the reasons for usefulness and calculation methodology, please refer to “Definition and calculation of Key Indicator terms” set out on pages R-14 to R-15.

iv Nature positive is defined by the World Business Council for Sustainable Development/Taskforce for Nature-related Financial Disclosures as ‘A high-level goal and concept describing a future state of nature (e.g. biodiversity, ecosystem services and natural capital) which is greater than the current state.’ It includes land and water management practices that halt and reverse nature loss – that is, supporting healthy, functioning ecosystems.

v US dollar amount is calculated based on actual transactional (historical) exchange rates related to Renova funding.

vi This excludes $2.0 billion of revenue-based royalties shown within net operating cash flows

vii Maintenance capital includes non-discretionary spend for the following purposes: deferred development and production stripping; risk reduction, compliance and asset integrity.

viii Medium term average; +/- 50% in any given year.

ix The information in this section is based on BHP data, analysis and desk top research on public data sources.

No offer of securities

Nothing in this release should be construed as either an offer, or a solicitation of an offer, to buy or sell BHP securities in any jurisdiction, or be treated or relied upon as a recommendation or advice by BHP.

Reliance on third party information

The views expressed in this release contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This release should not be relied upon as a recommendation or forecast by BHP.

Websites

All references to websites in this release are intended to be inactive textual references for information only and any information contained in or accessible through any such website does not form a part of this release.

1

References in this release to a ‘joint venture’ are used for convenience to collectively describe assets that are not wholly owned by BHP. Such references are not intended to characterise the legal relationship between the owners of the asset.

23

BHP

BHP

Financial Report

Half year ended

31 December 2022

BHP Results for the half year ended 31 December 2022

Contents

Half Year Financial Statements

	Page
Consolidated Income Statement for the half year ended 31 December 2022		F-3
Consolidated Statement of Comprehensive Income for the half year ended 31 December 2022		F-3
Consolidated Balance Sheet as at 31 December 2022		F-4
Consolidated Cash Flow Statement for the half year ended 31 December 2022		F-5
Consolidated Statement of Changes in Equity for the half year ended 31 December 2022		F-6
Notes to the Financial Statements		F-7
1.  Basis of preparation		F-7
2.  Exceptional items		F-8
3.  Interests in associates and joint venture entities		F-9
4.  Net finance costs		F-9
5.  Income tax expense		F-10
6.  Earnings per share		F-11
7.  Dividends		F-12
8.  Financial risk management – Fair values		F-13
9.  Significant events – Samarco dam failure		F-16
10.  Subsequent events		F-22
Directors’ Report		F-23

F-2

BHP Results for the half year ended 31 December 2022

Consolidated Income Statement for the half year ended 31 December 2022

	Notes		Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Continuing operations
Revenue				25,713			30,527			65,098
Other income				269			414			1,398
Expenses excluding net finance costs				(15,429	)		(15,742	)		(32,371	)
Profit/(loss) from equity accounted investments, related impairments and expenses		3		280			(354	)		(19	)
Profit from operations				10,833			14,845			34,106
Financial expenses				(863	)		(377	)		(1,050	)
Financial income				211			25			81
Net finance costs		4		(652	)		(352	)		(969	)
Profit before taxation				10,181			14,493			33,137
Income tax expense				(3,038	)		(4,833	)		(10,430	)
Royalty-related taxation (net of income tax benefit)				(17	)		(126	)		(307	)
Total taxation expense		5		(3,055	)		(4,959	)		(10,737	)
Profit after taxation from Continuing operations				7,126			9,534			22,400
Discontinued operations
Profit after taxation from Discontinued operations				–			972			10,655
Profit after taxation from Continuing and Discontinued operations				7,126			10,506			33,055
Attributable to non-controlling interests				669			1,063			2,155
Attributable to BHP shareholders				6,457			9,443			30,900
Basic earnings per ordinary share (cents)		6		127.5			186.6			610.6
Diluted earnings per ordinary share (cents)		6		127.3			186.2			609.3
Basic earnings from Continuing operations per ordinary share (cents)		6		127.5			167.4			400.0
Diluted earnings from Continuing operations per ordinary share (cents)		6		127.3			167.0			399.2

The accompanying notes form part of this half year Financial Report.

Consolidated Statement of Comprehensive Income for the half year ended 31 December 2022

		Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Profit after taxation from Continuing and Discontinued operations	��		7,126			10,506			33,055
Other comprehensive income
Items that may be reclassified subsequently to the income statement:
Hedges:
Gains/(losses) taken to equity			100			(302	)		(914	)
(Gains)/losses transferred to the income statement			(125	)		283			881
Exchange fluctuations on translation of foreign operations taken to equity			–			(3	)		(5	)
Exchange fluctuations on translation of foreign operations transferred to income statement			–			–			(54	)
Tax recognised within other comprehensive income			8			6			10
Total items that may be reclassified subsequently to the income statement			(17	)		(16	)		(82	)
Items that will not be reclassified to the income statement:
Re-measurement gains/(losses) on pension and medical schemes			6			(5	)		24
Equity investments held at fair value			(7	)		–			(8	)
Tax recognised within other comprehensive income			–			1			(9	)
Total items that will not be reclassified to the income statement			(1	)		(4	)		7
Total other comprehensive loss			(18	)		(20	)		(75	)
Total comprehensive income			7,108			10,486			32,980
Attributable to non-controlling interests			669			1,063			2,160
Attributable to BHP shareholders			6,439			9,423			30,820

The accompanying notes form part of this half year Financial Report.

F-3

BHP Results for the half year ended 31 December 2022

Consolidated Balance Sheet as at 31 December 2022

	31 Dec 2022 US$M			30 June 2022 US$M
ASSETS
Current assets
Cash and cash equivalents		9,605			17,236
Trade and other receivables		4,518			5,426
Other financial assets		475			629
Inventories		4,912			4,935
Current tax assets		444			263
Other		149			175
Total current assets		20,103			28,664
Non-current assets
Trade and other receivables		147			153
Other financial assets		870			802
Inventories		1,391			1,315
Property, plant and equipment		62,178			61,295
Intangible assets		1,397			1,369
Investments accounted for using the equity method		1,568			1,420
Deferred tax assets		54			56
Other		116			92
Total non-current assets		67,721			66,502
Total assets		87,824			95,166
LIABILITIES
Current liabilities
Trade and other payables		4,882			6,687
Interest bearing liabilities		2,015			2,622
Other financial liabilities		376			579
Current tax payable		469			3,032
Provisions		4,104			3,965
Deferred income		43			34
Total current liabilities		11,889			16,919
Non-current liabilities
Interest bearing liabilities		12,686			13,806
Other financial liabilities		2,498			1,997
Non-current tax payable		65			87
Deferred tax liabilities		3,367			3,063
Provisions		10,717			10,478
Deferred income		50			50
Total non-current liabilities		29,383			29,481
Total liabilities		41,272			46,400
Net assets		46,552			48,766
EQUITY
Share capital – BHP Group Limited		4,737			4,638
Treasury shares		(20	)		(31	)
Reserves		(28	)		12
Retained earnings		37,912			40,338
Total equity attributable to BHP shareholders		42,601			44,957
Non-controlling interests		3,951			3,809
Total equity		46,552			48,766

The accompanying notes form part of this half year Financial Report.

F-4

BHP Results for the half year ended 31 December 2022

Consolidated Cash Flow Statement for the half year ended 31 December 2022

	Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Operating activities
Profit before taxation from Continuing operations		10,181			14,493			33,137
Adjustments for:
Depreciation and amortisation expense		2,456			2,851			5,683
Impairments of property, plant and equipment, financial assets and intangibles		21			38			515
Net finance costs		652			352			969
(Profit)/loss from equity accounted investments, related impairments and expenses		(280	)		354			19
Other		258			273			(350	)
Changes in assets and liabilities:
Trade and other receivables		888			(18	)		(703	)
Inventories		(53	)		(420	)		(865	)
Trade and other payables		(1,598	)		(1,193	)		727
Provisions and other assets and liabilities		(399	)		(553	)		(248	)
Cash generated from operations		12,126			16,177			38,884
Dividends received		75			618			1,018
Interest received		218			16			58
Interest paid		(434	)		(300	)		(657	)
Proceeds from cash management related instruments		274			33			378
Net income tax and royalty-related taxation refunded		55			43			105
Net income tax and royalty-related taxation paid		(5,544	)		(5,058	)		(10,501	)
Net operating cash flows from Continuing operations		6,770			11,529			29,285
Net operating cash flows from Discontinued operations		–			1,748			2,889
Net operating cash flows		6,770			13,277			32,174
Investing activities
Purchases of property, plant and equipment		(2,871	)		(2,768	)		(5,855	)
Exploration expenditure		(156	)		(110	)		(256	)
Exploration expenditure expensed and included in operating cash flows		127			80			199
Net investment and funding of equity accounted investments		(369	)		(244	)		(266	)
Proceeds from sale of assets		81			92			221
Proceeds from sale of subsidiaries, operations and joint operations net of their cash		74			–			1,255
Other investing		(175	)		(95	)		(271	)
Net investing cash flows from Continuing operations		(3,289	)		(3,045	)		(4,973	)
Net investing cash flows from Discontinued operations		–			(544	)		(904	)
Net cash completion payment on merger of Petroleum with Woodside		–			–			(683	)
Cash and cash equivalents disposed on merger of Petroleum with Woodside		–			–			(399	)
Net investing cash flows		(3,289	)		(3,589	)		(6,959	)
Financing activities
Proceeds from interest bearing liabilities		350			314			1,164
Settlements of debt related instruments		(383	)		–			–
Repayment of interest bearing liabilities		(1,690	)		(1,499	)		(3,358	)
Purchase of shares by Employee Share Ownership Plan (ESOP) Trusts		(1	)		(1	)		(149	)
Dividends paid		(8,660	)		(10,029	)		(17,851	)
Dividends paid to non-controlling interests		(527	)		(1,273	)		(2,540	)
Net financing cash flows from Continuing operations		(10,911	)		(12,488	)		(22,734	)
Net financing cash flows from Discontinued operations		–			(18	)		(33	)
Net financing cash flows		(10,911	)		(12,506	)		(22,767	)
Net (decrease)/increase in cash and cash equivalents from Continuing operations		(7,430	)		(4,004	)		1,578
Net increase in cash and cash equivalents from Discontinued operations		–			1,186			1,952
Net cash completion payment on merger of Petroleum with Woodside		–			–			(683	)
Cash and cash equivalents disposed on merger of Petroleum with Woodside		–			–			(399	)
Cash and cash equivalents, net of overdrafts, at the beginning of the period		17,236			15,246			15,246
Foreign currency exchange rate changes on cash and cash equivalents		(201	)		(62	)		(458	)
Cash and cash equivalents, net of overdrafts, at the end of the period		9,605			12,366			17,236

The accompanying notes form part of this half year Financial Report.

F-5

BHP Results for the half year ended 31 December 2022

Consolidated Statement of Changes in Equity for the half year ended 31 December 2022

	Attributable to BHP shareholders
	Share capital				Treasury shares
US$M	BHP Group Limited 1		BHP Group Plc 1		BHP Group Limited			BHP Group Plc			Reserves 1			Retained earnings			Total equity attributable to BHP shareholders			Non- controlling interests			Total equity
Balance as at 1 July 2022		4,638		–		(31	)		–			12			40,338			44,957			3,809			48,766
Total comprehensive income		–		–		–			–			(24	)		6,463			6,439			669			7,108
Transactions with owners:
BHP Group Limited shares issued		99		–		(99	)		–			–			–			–			–			–
Purchase of shares by ESOP Trusts		–		–		(1	)		–			–			–			(1	)		–			(1	)
Employee share awards exercised net of employee contributions net of tax		–		–		111			–			(80	)		(31	)		–			–			–
Vested employee share awards that have lapsed, been cancelled or forfeited		–		–		–			–			–			–			–			–			–
Accrued employee entitlement for unexercised awards net of tax		–		–		–			–			64			–			64			–			64
Dividends		–		–		–			–			–			(8,858	)		(8,858	)		(527	)		(9,385	)
Balance as at 31 December 2022		4,737		–		(20	)		–			(28	)		37,912			42,601			3,951			46,552
Balance as at 1 July 2021		1,111		1,057		(32	)		(1	)		2,350			46,779			51,264			4,341			55,605
Total comprehensive income		–		–		–			–			(16	)		9,439			9,423			1,063			10,486
Transactions with owners:
BHP Group Limited shares issued		172		–		(172	)		–			–			–			–			–			–
Purchase of shares by ESOP Trusts		–		–		–			(1	)		–			–			(1	)		–			(1	)
Employee share awards exercised net of employee contributions net of tax		–		–		197			2			(124	)		(75	)		–			–			–
Vested employee share awards that have lapsed, been cancelled or forfeited		–		–		–			–			(4	)		4			–			–			–
Accrued employee entitlement for unexercised awards net of tax		–		–		–			–			67			–			67			–			67
Dividends		–		–		–			–			–			(10,119	)		(10,119	)		(1,273	)		(11,392	)
Equity contributed net of tax		–		–		–			–			153			–			153			4			157
Balance as at 31 December 2021		1,283		1,057		(7	)		–			2,426			46,028			50,787			4,135			54,922

1 As a result of th e corporate structure unification on 31 January 2022, 2,112,071,796 fully paid ordinary shares in BHP Group Limited were issued to BHP Group Plc shareholders in a one for one exchange of their BHP Group Plc ordinary shares, resulting in BHP Group Limited becoming the sole parent of the Group with a single set of shareholders.   This resulted in an increase in BHP Group Limited share capital, reduction of BHP Group Plc share capital to US$ nil and a reduction of the Group’s reserve balances.

The accompanying notes form part of this half year Financial Report.

F-6

BHP Results for the half year ended 31 December 2022

Notes to the Financial Statements

1. Basis of preparation

This

general purpose Financial Report for the half year ended 31 December 2022 is unaudited and has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ as issued by the International Accounting Standards Board (IASB) and AASB 134 ‘Interim Financial Reporting’ as issued by the Australian Accounting Standards Board (AASB) and the Australian Corporations Act 2001 as applicable to interim financial reporting.

The general purpose Financial Report for the half year ended 31 December 2022

does not include all of the notes of the type normally included in an annual report. Accordingly, this report

should be read in conjunction with the annual consolidated Financial Statements for the year ended 30 June 2022 and any public announcements made by the Group in accordance with the continuous disclosure obligations of the ASX Listing Rules.

Segment Reporting disclosures from IAS 34/AASB 134 ‘Interim Financial Reporting’ have been disclosed within the Segment summary on page 15 outside of this Financial Report.

The half year Financial Statements have been prepared on a basis of accounting policies and methods of computation consistent with those applied in the 30 June 2022 annual consolidated Financial Statements contained within the Annual Report of the Group with the exception of the adoption of

an

amendment to IAS 16/AASB 116 ‘Property, Plant and Equipment’ which became effective from 1 July 2022. The impact of this amendment is described below. A number of other accounting standards and interpretations have been issued, and will be applicable in future periods. While these remain subject to ongoing assessment, no significant impacts have been identified to date. These standards have not been applied in the preparation of these half year Financial Statements.

All amounts are expressed in US dollars unless otherwise stated. The Group’s presentation currency and the functional currency of the majority of its operations is US dollars as this is the principal currency of the economic environment in which it operates. Amounts in this Financial Report have, unless otherwise indicated, been rounded to the nearest million dollars.

The

Directors

have made an assessment of the Group’s ability to continue as a going concern for the 12 months from the date of this report and consider it appropriate to adopt the going concern basis of accounting in preparing the half year Financial Statements.

Impact of new and amended standards and interpretations

On 1 July 2022, the Group adopted an amendment to IAS 16/AASB 116 ‘Property, Plant and Equipment’ that requires an entity to recognise the sales proceeds from selling items produced while preparing property, plant and equipment for its intended use, and the related cost, in profit or loss, instead of deducting the amounts received from the cost of the asset.

The amendment applies retrospectively to items of property, plant and equipment made available for use on or after 1 July 2020. However, no significant impacts have been identified in respect of the years ended 30 June 2021 and 30 June 2022 and, as such, comparative period financial information has not been restated.

F-7

BHP Results for the half year ended 31 December 2022

2. Exceptional items

Exceptional

items are those gains or losses where their nature, including the expected frequency of the events giving rise to them, and impact is considered material to the Financial Statements. Such items included within the Group’s profit for the half year are detailed below.

Half year ended 31 December 2022	Gross US$M			Tax US$M		Net US$M
Exceptional items by category
Samarco dam failure		(142	)		2		(140	)
Total		(142	)		2		(140	)
Attributable to non-controlling interests		–			–		–
Attributable to BHP shareholders		(142	)		2		(140	)

Samarco Mineração SA (Samarco) dam failure

The loss of US$140

million (after tax)

relates

to the Samarco dam failure

, which occurred

in November 2015

, and

comprises the following:

 

Half year ended 31 December 2022	US$M
Expenses excluding net finance costs:
Costs incurred directly by BHP Brasil and other BHP entities in relation to the Samarco dam failure		(47	)
Profit from equity accounted investments, related impairments and expenses:
Samarco impairment expense		–
Samarco Germano dam decommissioning		31
Samarco dam failure provision		(13	)
Fair value change on forward exchange derivatives		109
Net finance costs		(222	)
Income tax benefit		2
Total 1		(140	)

1 Refer to note 9 ‘Significant events – Samarco dam failure’ for further information.

The exceptional items relating to the half year ended 31 December 2021 and the year ended 30 June 2022 are detailed below.

Half year ended 31 December 2021	Gross US$M			Tax US$M			Net US$M
Exceptional items by category
Samarco dam failure		(822	)		1			(821	)
Impairment of US deferred tax assets		–			(423	)		(423	)
Total		(822	)		(422	)		(1,244	)
Attributable to non-controlling interests		–			–			–
Attributable to BHP shareholders		(822	)		(422	)		(1,244	)
Year ended 30 June 2022	Gross US$M			Tax US$M			Net US$M
Exceptional items by category
Samarco dam failure		(1,032	)		(31	)		(1,063	)
Impairment of US deferred tax assets		–			(423	)		(423	)
Corporate structure unification costs		(428	)		–			(428	)
BHP Mitsui Coal (BMC) gain on disposal		840			–			840
Total		(620	)		(454	)		(1,074	)
Attributable to non-controlling interests		–			–			–
Attributable to BHP shareholders		(620	)		(454	)		(1,074	)

F-8

BHP Results for the half year ended 31 December 2022

3. Interests in associates and joint venture entities

The

Group’s major shareholdings in associates and joint venture entities, including their profit/(loss), are listed below:

	Ownership interest at the Group’s reporting date						Profit/(loss) from equity accounted investments, related impairments and expenses
	31 Dec 2022 %		31 Dec 2021 %		30 June 2022 %		Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Share of profit/(loss) of equity accounted investments:
Compañia Minera Antamina SA		33.75		33.75		33.75		185			381			720
Samarco Mineração SA 1		50.00		50.00		50.00		–			–			–
Other								(32	)		(33	)		(63	)
Share of profit of equity accounted investments								153			348			657
Samarco dam failure provision 1								(13	)		(539	)		(663	)
Samarco Germano dam decommissioning 1								31			49			68
Fair value change on forward exchange derivatives 1								109			(212	)		(81	)
Profit/(loss) from equity accounted investments, related impairments and expenses								280			(354	)		(19	)

1 Refer to note 9 ‘Significant events – Samarco dam failure’ for further information.

4. Net finance costs

	Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Financial expenses
Interest expense using the effective interest rate method:
Interest on bank loans, overdrafts and all other borrowings		487			230			491
Interest capitalised at 5.20% (31 December 2021: 2.48%; 30 June 2022: 2.90%) 1		(114	)		(49	)		(113	)
Interest on lease liabilities		62			63			119
Discounting on provisions and other liabilities		613			243			645
Other gains and losses:
Fair value change on hedged loans		(754	)		(245	)		(1,286	)
Fair value change on hedging derivatives		659			218			1,277
Exchange variations on net debt		(90	)		(83	)		(99	)
Other		–			–			16
Total financial expenses		863			377			1,050
Financial income
Interest income		(211	)		(25	)		(81	)
Net finance costs		652			352			969

1 Interest has been capitalised at the rate of interest applicable to the specific borrowings financing the assets under construction or, where financed through general borrowings, at a capitalisation rate representing the average interest rate on such borrowings.

F-9

BHP Results for the half year ended 31 December 2022

5. Income tax expense

	Half year ended 31 Dec 2022 US$M		Half year ended 31 Dec 2021 US$M		Year ended 30 June 2022 US$M
Total taxation expense comprises:
Current tax expense		2,738		4,184		10,673
Deferred tax expense		317		775		64
		3,055		4,959		10,737

	Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Factors affecting income tax expense for the year
Income tax expense differs to the standard rate of corporation tax as follows:
Profit before taxation		10,181			14,493			33,137
Tax on profit at Australian prima facie tax rate of 30 per cent		3,054			4,348			9,941
Non-tax effected operating losses and capital gains 1		162			709			1,087
Tax on remitted and unremitted foreign earnings		37			344			441
Foreign exchange adjustments		11			(91	)		(233	)
Amounts over provided in prior years		(5	)		(17	)		(80	)
Recognition of previously unrecognised tax assets		(28	)		(195	)		(3	)
Tax effect of (profit)/loss from equity accounted investments, related impairments and expenses 2		(52	)		42			(19	)
Impact of tax rates applicable outside of Australia		(189	)		(411	)		(801	)
Other		48			104			97
Income tax expense		3,038			4,833			10,430
Royalty-related taxation (net of income tax benefit)		17			126			307
Total taxation expense		3,055			4,959			10,737

1 Includes the tax impacts related to the exceptional impairments of US deferred tax assets in the half year ended 31 December 2021 and the year ended 30 June 2022. Refer to note 2 ‘Exceptional Items’ for further information.

2 The (profit)/loss from equity accounted investments and related expenses is net of income tax, with the exception of the Samarco forward exchange derivatives described in note 9 ‘Significant events – Samarco dam failure’. This item removes the prima facie tax effect on such profits and related expenses, excluding the impact of the Samarco forward exchange derivatives which are taxable. 

F-10

BHP Results for the half year ended 31 December 2022

6. Earnings per share

	Half year ended 31 Dec 2022 US$M		Half year ended 31 Dec 2021 US$M		Year ended 30 June 2022 US$M
Earnings attributable to BHP shareholders (US$M) 1
- Continuing operations		6,457		8,471		20,245
- Total		6,457		9,443		30,900
Weighted average number of shares (Million)
- Basic 2		5,064		5,061		5,061
- Diluted 3		5,073		5,072		5,071
Basic earnings per ordinary share (US cents) 4
- Continuing operations		127.5		167.4		400.0
- Total		127.5		186.6		610.6
Diluted earnings per ordinary share (US cents) 4
- Continuing operations		127.3		167.0		399.2
- Total		127.3		186.2		609.3
Headline earnings per ordinary share (US cents) 5
- Basic		127.9		185.6		439.0
- Diluted		127.7		185.2		438.1

1

Diluted earnings attributable to BHP shareholders are equal to earnings attributable to BHP shareholders.

2

Prior to the unification of BHP’s corporate structure, the calculation of the number of ordinary shares used in the computation of basic earnings per share was the aggregate of the weighted average number of ordinary shares of BHP Group Limited and BHP Group Plc outstanding during the period after deduction of the number of shares held by the Billiton Employee Share Ownership Trust and the BHP Billiton Limited Employee Equity Trust. Effective from 31 January 2022, the aggregate of the weighted average number of ordinary shares of only BHP Group Limited is considered in the computation of basic earnings per share.

3

For the purposes of calculating diluted earnings per share, the effect of 9 million dilutive shares has been taken into account for the half year ended 31 December 2022 (31 December 2021: 11 million shares; 30 June 2022: 10 million shares). The Group’s only potential dilutive ordinary shares are share awards granted under employee share ownership plans. Diluted earnings per share calculation excludes instruments which are considered antidilutive.

At 31 December 2022, there are no instruments which are considered antidilutive (31 December 2021: nil; 30 June 2022: nil).

4
Each American Depositary Share (ADS) represents twice the earnings for BHP Group Limited ordinary shares.

5
Headline earnings is a Johannesburg Stock Exchange defined performance measure and is reconciled from earnings attributable to ordinary shareholders as follows:

	Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Earnings attributable to BHP shareholders		6,457			9,443			30,900
Adjusted for:
Loss/(gain) on sales of PP&E, Investments and Operations i		2			(110	)		(95	)
Impairments of property, plant and equipment, financial assets and intangibles		21			38			515
Gain on disposal of BHP Mitsui Coal		–			–			(840	)
Gain on merger of Petroleum		–			–			(8,167	)
Tax effect of above adjustments		(1	)		23			(97	)
Subtotal of adjustments		22			(49	)		(8,684	)
Headline earnings		6,479			9,394			22,216
Diluted headline earnings		6,479			9,394			22,216

i Included in other income.

F-11

BHP Results for the half year ended 31 December 2022

7. Dividends

	Half year ended 31 Dec 2022				Half year ended 31 Dec 2021				Year ended 30 June 2022
	Per share US cents		Total US$M		Per share US cents		Total US$M		Per share US cents		Total US$M
Dividends paid during the period
Prior year final dividend		175.0		8,858		200.0		10,119		200.0		10,119
Interim dividend		N/A		–		N/A		–		150.0		7,601
		175.0		8,858		200.0		10,119		350.0		17,720

Dividends paid during the period differs from the amount of dividends paid in the

Consolidated

Cash Flow Statement as a result of foreign exchange gains and losses relating to the timing of equity distributions between the record date and the payment date. An additional derivative settlement of US$209

million was made as part of the funding of the final dividend and is disclosed in ‘Proceeds of cash management related instruments’ in the Consolidated Cash Flow Statement. 

Each American Depositary Share represents two ordinary shares of BHP Group Limited. Dividends determined on each ADS represent twice the dividend determined on BHP Group Limited ordinary shares.

Dividends are determined after

period-end

and contained within the announcement of the results for the period. Interim dividends are determined in February and paid in March. Final dividends are determined in August and paid in September. Dividends determined are not recorded as a liability at the end of the period to which they relate. Subsequent to the half year, on

21

 February 2023, BHP Group Limited determined an interim ordinary dividend of 90 US cents per share (US$

4,559

million), which will be paid on

30

 March 2023 (31 December 2021: interim dividend of 150 US cents per share – US$7,593 million; 30 June 2022: final dividend of 175 US cents per share – US$8,857 million).

BHP Group Limited dividends for all periods presented are, or will be, fully franked based on a tax rate of 30 per cent.

F-12

BHP Results for the half year ended 31 December 2022

8. Financial risk management – Fair values

Recognition and measurement

All financial assets and financial liabilities, other than derivatives and trade receivables, are initially recognised at the fair value of consideration paid or received, net of transaction costs as appropriate. Financial assets are initially recognised on their trade date.

Financial assets are subsequently carried at fair value or amortised cost based on:

- the Group’s purpose, or business model, for holding the financial asset;

- whether the financial asset’s contractual terms give rise to cash flows that are solely payments of principal and interest.

The resulting Financial Statements classifications of financial assets can be summarised as follows:

Contractual cash flows	Business model	Category
Solely principal and interest	Hold in order to collect contractual cash flows	Amortised cost
Solely principal and interest	Hold in order to collect contractual cash flows and sell	Fair value through other comprehensive income
Solely principal and interest	Hold in order to sell	Fair value through profit or loss
Other	Any of those mentioned above	Fair value through profit or loss

Solely principal and interest refers to the Group receiving returns only for the time value of money and the credit risk of the counterparty for financial assets held. The main exceptions for the Group are provisionally priced receivables and derivatives which are measured at fair value through the profit or loss under IFRS 9/AASB 9 ‘Financial Instruments’.

The Group has the intention of collecting payment directly from its customers in most cases, however the Group also participates in receivables financing programs in respect of selected customers. Receivables in these portfolios which are classified as ‘hold in order to sell’, are provisionally priced receivables and are therefore held at fair value through profit or loss prior to sale to the financial institution.

With the exception of derivative contracts and provisionally priced trade payables which are carried at fair value through profit or loss, the Group’s financial liabilities are classified as subsequently measured at amortised cost.

The Group may in addition elect to designate certain financial assets or liabilities at fair value through profit or loss or to apply hedge accounting where they are not mandatorily held at fair value through profit or loss.

Fair value measurement

The carrying amount of financial assets and liabilities measured at fair value is principally calculated based on inputs other than quoted prices that are observable for these financial assets or liabilities, either directly (i.e. as unquoted prices) or indirectly (i.e. derived from prices). Where no price information is available from a quoted market source, alternative market mechanisms or recent comparable transactions, fair value is estimated based on the Group’s views on relevant future prices, net of valuation allowances to accommodate liquidity, modelling and other risks implicit in such estimates.

The inputs used in fair value calculations are determined by the Group’s relevant subject matter experts, who operate under a defined set of accountabilities authorised by the Executive Leadership Team. Movements in the fair value of financial assets and liabilities may be recognised through the income statement or in other comprehensive income according to the designation of the underlying instrument.

For financial assets and liabilities carried at fair value, the Group uses the following to categorise the inputs to the valuation method used based on the lowest level input that is significant to the fair value measurement as a whole:

IFRS 13 Fair value hierarchy	Level 1	Level 2	Level 3
Valuation inputs	Based on quoted prices (unadjusted) in active markets for identical financial assets and liabilities.	Based on inputs other than quoted prices included within Level 1 that are observable for the financial asset or liability, either directly (i.e. as unquoted prices) or indirectly (i.e. derived from prices).	Based on inputs not observable in the market using appropriate valuation models, including discounted cash flow modelling.

F-13

BHP Results for the half year ended 31 December 2022

Financial assets and liabilities

The financial assets and liabilities are presented by class in the table below at their carrying amounts.

	IFRS 13 Fair value hierarchy Level 1	IFRS 9 Classification	31 Dec 2022 US$M		30 June 2022 US$M
Current cross currency and interest rate swaps 2	2	Fair value through profit or loss		–		–
Current other derivative contracts	2	Fair value through profit or loss		146		326
Current other financial assets	–	Amortised cost		–		100
Current other investments 3	1,2	Fair value through profit or loss		329		203
Non-current cross currency and interest rate swaps 2	2	Fair value through profit or loss		167		136
Non-current other derivative contracts	2	Fair value through profit or loss		26		16
Non-current other financial assets 4	3	Fair value through profit or loss		238		273
Non-current investment in shares	1,3	Fair value through other comprehensive income		178		138
Non-current other investments 3	1,2	Fair value through profit or loss		261		239
Total other financial assets				1,345		1,431
Cash and cash equivalents		Amortised cost		9,605		17,236
Trade and other receivables 5		Amortised cost		1,293		1,674
Provisionally priced trade receivables	2	Fair value through profit or loss		2,960		3,478
Total financial assets				15,203		23,819
Non-financial assets				72,621		71,347
Total assets				87,824		95,166
Current cross currency and interest rate swaps 2	2	Fair value through profit or loss		205		358
Current other derivative contracts	2	Fair value through profit or loss		101		118
Current other financial liabilities 6		Amortised cost		70		103
Non-current cross currency and interest rate swaps 2	2	Fair value through profit or loss		2,025		1,466
Non-current other derivative contracts	2	Fair value through profit or loss		38		31
Non-current other financial liabilities 6		Amortised cost		435		500
Total other financial liabilities				2,874		2,576
Trade and other payables 7		Amortised cost		4,149		5,223
Provisionally priced trade payables	2	Fair value through profit or loss		652		1,385
Bank loans 8		Amortised cost		2,460		2,472
Notes and debentures 8		Amortised cost		9,546		11,363
Lease liabilities				2,694		2,576
Other 8		Amortised cost		1		17
Total financial liabilities				22,376		25,612
Non-financial liabilities				18,896		20,788
Total liabilities				41,272		46,400

1 All of the Group’s financial assets and financial liabilities recognised at fair value were valued using market observable inputs categorised as Level 2 unless specified otherwise in the following footnotes.

2 Cross currency and interest rate swaps are valued using market data including interest rate curves and foreign exchange rates. A discounted cash flow approach is used to derive the fair value of cross currency and interest rate swaps at the reporting date.

3 Includes investments held by BHP Foundation which are restricted and not available for general use by the Group of  US$277   million (30 June 2022: US $252   million)   of which other investments (mainly US Treasury Notes) of US$135 million is categorised as Level 1 (30 June 2022: US$119 million).

4 Includes receivables contingent on outcome of future events relating to mining and regulatory approvals of US$238   million (30 June 2022: $233   million) .

5 Excludes input taxes of US$412 million (30 June 2022: US$427 million) included in other receivables.

6 Includes the discounted settlement liability in relation to the cancellation of power contracts at the Group’s Escondida operations.

7 Excludes input taxes of US$81 million (30 June 2022: US$79 million) included in other payables.

8 All interest bearing liabilities, excluding lease liabilities, are unsecured.

F-14

BHP Results for the half year ended 31 December 2022

The carrying amounts in the table above generally approximate to fair value. In the case of US$534 million (30 June 2022: US$3,018 million) of fixed rate debt not swapped to floating rate, the fair value at 31 December 2022 was US$548 million (30 June 2022: US$3,126 million). The fair value is determined using a method that can be categorised as Level 2 and uses inputs based on benchmark interest rates, alternative market mechanisms or recent comparable transactions.

For financial instruments that are carried at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the fair value hierarchy by reassessing categorisation at the end of each reporting period.

There were no transfers between categories during the period.

Interest Rate Benchmark Reform

The London Interbank Offered Rate (LIBOR) and other benchmark interest rates are being replaced by alternative risk-free rates (ARR) as part of inter-bank offer rate (IBOR) reform. Sterling LIBOR ceased to be published on 1 January 2022 and USD LIBOR will no longer be published after 30 June 2023.

Amendments to IFRS 9/AASB 9 ‘Financial Instruments’, IFRS 7/AASB 7 ‘Financial Instruments: Disclosures’ and IFRS 16/AASB 16 ‘Leases’ in relation to IBOR reform early adopted by the Group in previous periods impact the Group’s cross currency and interest rate swaps, which prior to IBOR reform referenced the US LIBOR benchmark, and the associated hedge accounting.

These amendments provide relief from applying certain hedge accounting requirements to hedging arrangements directly impacted by IBOR reform. In particular, where changes to the Group’s instruments arise solely as a result of IBOR reform and do not change the economic substance of the Group’s arrangements, the Group is able to maintain its existing hedge relationships and accounting.

During the half year ended 31 December 2022, the Group actively transitioned all impacted cross currency and interest rate swaps from US LIBOR to the alternative, widely adopted Secured Overnight Financing Rate (SOFR) benchmark. As the transition resulted solely from IBOR reform, the Group has applied the relief available in IFRS 9/AASB 9 ‘Financial Instruments’ and continues to apply hedge accounting to its hedging arrangements, including accounting for ineffectiveness.

The Group does not hold any material lease arrangements that contain reference to existing benchmarks and as a result there is no material impact on lease liabilities or

right-of-use

assets at 31 December 2022.

F-15

BHP Results for the half year ended 31 December 2022

9. Significant events – Samarco dam failure

As

a result of the Samarco dam failure on 5 November 2015, BHP Billiton Brasil Ltda (BHP Brasil) and other Group entities continue to incur costs and maintain liabilities for future costs. The information presented in this note should be read in conjunction with section 8 ‘Samarco’ and Financial Statements note 4 ‘Significant events – Samarco dam failure’ in the 30 June 2022 Annual Report.

The financial impacts of the Samarco dam failure on the Group’s income statement, balance sheet and cash flow statement for the half year ended 31 December 2022 are shown below and have been treated as an exceptional item.

Financial impacts of Samarco dam failure	Half year ended 31 Dec 2022 US$M			Half year ended 31 Dec 2021 US$M			Year ended 30 June 2022 US$M
Income statement
Other income 1		–			–			–
Expenses excluding net finance costs:
Costs incurred directly by BHP Brasil and other BHP entities in relation to the Samarco dam failure 2		(47	)		(27	)		(66	)
Profit/(loss) from equity accounted investments, related impairments and expenses:
Samarco impairment expense 3		–			–			–
Samarco Germano dam decommissioning 4		31			49			68
Samarco dam failure provision 5		(13	)		(539	)		(663	)
Fair value change on forward exchange derivatives 6		109			(212	)		(81	)
Profit/(loss) from operations		80			(729	)		(742	)
Net finance costs 7		(222	)		(93	)		(290	)
Loss before taxation		(142	)		(822	)		(1,032	)
Income tax benefit/(expense)		2			1			(31	)
Loss after taxation		(140	)		(821	)		(1,063	)
Balance sheet movement
Trade and other payables		–			3			(1	)
Derivatives		83			(202	)		(160	)
Tax liabilities		2			1			(31	)
Provisions		135			(327	)		(629	)
Net liabilities		220			(525	)		(821	)

	Half year ended 31 Dec 2022 US$M					Half year ended 31 Dec 2021 US$M					Year ended 30 June 2022 US$M
Cash flow statement
Loss before taxation				(142	)				(822	)				(1,032	)
Adjustments for:
Samarco impairment expense 3		–					–					–
Samarco Germano dam decommissioning 4		(31	)				(49	)				(68	)
Samarco dam failure provision 5		13					539					663
Fair value change on forward exchange derivatives 6		(109	)				212					81
Proceeds/(settlements) of cash management related instruments		26					(10	)				79
Net finance costs 7		222					93					290
Changes in assets and liabilities:
Trade and other payables		–					(3	)				1
Net operating cash flows				(21	)				(40	)				14
Net investment and funding of equity accounted investments 8				(339	)				(256	)				(256	)
Net investing cash flows				(339	)				(256	)				(256	)
Net decrease in cash and cash equivalents				(360	)				(296	)				(242	)

1 Proceeds from insurance settlements.

2 Includes legal and advisor costs incurred.

3 Impairment expense from working capital funding provided during the period.

4 US$(33) million (31 December 2021: US$25 million; 30 June 2022: US$(56) million) change in estimate and US$2 million (31 December 2021: US$24 million; 30 June 2022: US$(12) million) exchange translation.

5 US$ nil (31 December 2021: US$(806) million; 30 June 2022: US$747 million) change in estimate and US$13 million (31 December 2021: US$267 million; 30 June 2022: US$(84) million) exchange translation.

6	The Group enters into forward exchange contracts to limit the Brazilian reais exposure on the dam failure provisions. While not applying hedge accounting, the fair value changes in the forward exchange instruments are recorded within Profit/(loss) from equity accounted investments, related impairments and expenses in the Income Statement.
7	Amortisation of discounting of provision.
8	Includes US$ nil (31 December 2021: US$ nil; 30 June 2022: US$ nil) working capital funding provided during the period, US$(339) million (31 December 2021: US$(256) million; 30 June 2022: US$(256) million) utilisation of the Samarco dam failure provision and US$ nil (31 December 2021: US$ nil; 30 June 2022: US$ nil) utilisation of the Samarco Germano decommissioning provision.

F-16

BHP Results for the half year ended 31 December 2022

Equity accounted investment in Samarco

BHP Brasil’s investment in Samarco remains at US$ nil. No dividends hav

e

 been received by BHP Brasil from Samarco during the period and Samarco currently does not have profits available for distribution.

Provisions related to the Samarco dam failure

			31 Dec 2022 US$M					30 June 2022 US$M
At the beginning of the reporting period				3,421					2,792
Movement in provisions				(135	)				629
Comprising:
Utilised	(339	)				(256	)
Adjustments charged to the income statement:
Change in estimate — Samarco dam failure provision	–					747
Change in estimate — Samarco Germano dam decommissioning	(33	)				(56	)
Amortisation of discounting impacting net finance costs	222					290
Exchange translation	15					(96	)
At the end of the reporting period				3,286					3,421
Comprising:
Current				1,950					1,815
Non-current				1,336					1,606
At the end of the reporting period				3,286					3,421
Comprising:
Samarco dam failure provision				3,122					3,237
Samarco Germano dam decommissioning provision				164					184

Provision for Samarco dam failure

On 2 March 2016, BHP Brasil, Samarco and Vale, entered into a Framework Agreement with the Federal Government of Brazil, the states of Espírito Santo and Minas Gerais and certain other public authorities to establish a foundation (Fundação Renova) to develop and execute environmental and socio-economic programs (Programs) to remediate and provide compensation for the damages caused by the Samarco dam failure (the Framework Agreement). Key Programs include those for financial assistance and compensation of impacted persons, including fisherfolk impacted by the dam failure, and those for remediation of impacted areas and resettlement of impacted communities. A committee (the Interfederative Committee) comprising representatives from the Brazilian Federal and State Governments, local municipalities, environmental agencies, impacted communities and Public Defence Office oversees the activities of the Fundação Renova in order to monitor, guide and assess the progress of the actions agreed in the Framework Agreement.

In addition,

the

 Federal Court is supervising the work of the Fundação Renova and the Court’s decisions, including decisions relating to the scope of individuals eligible for compensation and the amount of damages to which they are entitled, have been considered in the Samarco dam failure provision change in estimate. Any future decisions will be analysed for impacts on the provision at the time of any decision and the provision may be impacted in future reporting periods as a result of appeals and motions for clarification on certain Court decisions that remain outstanding.

To the extent that Samarco does not meet its Renova funding obligations during the 15 year term of the Framework Agreement, each of BHP Brasil and Vale have secondary funding obligations under the Framework Agreement in proportion to its 50 per cent shareholding in Samarco.

Samarco began to gradually recommence operations in December 2020, however, there remains significant uncertainty regarding Samarco’s future cash flow generation and the outcome of the Judicial Reorganisation (outlined below). In light of these uncertainties and based on currently available information, BHP Brasil’s provision for its obligations under the Framework Agreement Programs is US$3.1 billion before tax and after discounting at 31 December 2022 (30 June 2022: US$3.2 billion).

Under a Governance Agreement ratified on 8 August 2018, BHP Brasil, Samarco and Vale were to establish a process to renegotiate the Programs over

two

years to progress settlement of the R$155 billion (approximately US$30 billion) Federal Public Prosecution Office claim (described below).

Pre-requisites

established in the Governance Agreement, for

re-negotiation

of the Framework Agreement were not implemented during the two year period and on 30 September 2020, Brazilian Federal and State prosecutors and public defenders filed a request for the immediate resumption of the R$155 billion (approximately US$30 billion) claim, which was suspended from the date of ratification of the Governance Agreement. The claim was suspended again after the parties to the claim agreed to continue the suspension on 19 March 2021. Formal suspension of the claim ceased on 10 December 2021, however no further material rulings have been made.

F-17

BHP Results for the half year ended 31 December 2022

BHP

Brasil, Samarco, Vale and Federal and State prosecutors have been engaging in negotiations to seek a definitive and substantive settlement of the obligations under the Framework Agreement and the

R$

155

 billion (approximately US$

30

billion)

Federal Public Prosecution Office claim. The negotiations are currently ongoing. Outcomes of the negotiations are highly uncertain and, until any revisions to the Programs are agreed, Fundação Renova will continue to implement the Programs in accordance with the terms of the Framework Agreement and the Governance Agreement.

BHP Brasil, Samarco and Vale maintain security, as required by the Governance Agreement, with the security currently comprising insurance bonds and a charge over Samarco’s assets.

Samarco Germano dam decommissioning

Samarco is currently progressing plans for the accelerated decommissioning of its upstream tailings dams (the Germano dam complex). Given the uncertainties surrounding Samarco’s long-term cash flow generation, BHP Brasil’s provision for a 50 per cent share of the expected Germano decommissioning costs is US$164 million at 31 December 2022 (30 June 2022: US$184 million). While the decommissioning is progressing well, further engineering work may be necessary and required validation by Brazilian authorities could lead to changes to estimates in future reporting periods.

Contingent liabilities

The following matters are disclosed as contingent liabilities and given the status of proceedings it is not possible to provide a range of possible outcomes or a reliable estimate of potential future exposures for BHP, unless otherwise stated. Ultimately, all the legal matters disclosed as contingent liabilities could have a material adverse impact on BHP’s business, competitive position, cash flows, prospects, liquidity and shareholder returns.

Federal Public Prosecution Office claim

BHP Brasil is among the defendants named in a claim brought by the Federal Public Prosecution Office on 3 May 2016, seeking R$155 billion (approximately US$30 billion) for reparation, compensation and moral damages in relation to the Samarco dam failure.

TheFederal Court previously suspended the Federal Public Prosecution Office claim, including a R$7.7 billion (approximately US$1.5 billion) injunction request. On 30 September 2020, Brazilian Federal and State prosecutors and public defenders filed a request for the immediate resumption of the R$155 billion (approximately US$30 billion) claim, which was suspended from the date of ratification of the Governance Agreement. Formal suspension of the claim ceased on 10 December 2021, however no further material rulings have been made.

BHP Brasil, Samarco, Vale and Federal and State prosecutors have been engaging in negotiations to seek a definitive and substantive settlement of the obligations under the Framework Agreemen

t

and the R$

155

 billion (approximately US$

30

billion) Federal Public Prosecution Office claim. The negotiations are currently ongoing. Outcomes of the negotiations are highly uncertain and it is therefore not possible to provide a range of outcomes or a reliable estimate of potential outcomes and there is a risk that a negotiated outcome may be materially higher than amounts currently reflected in the Samarco dam failure provision. 

Australian class action complaints

BHP Group Ltd is named as a defendant in a shareholder class action filed in the Federal Court of Australia on behalf of persons who acquired shares in BHP Group Ltd on the Australian Securities Exchange or shares in BHP Group Plc on the London Stock Exchange and Johannesburg Stock Exchange in periods prior to the Samarco dam failure. The amount of damages sought is unspecified.

United Kingdom group action complaint

BHP Group (UK) Ltd (former BHP Group Plc) and BHP Group Ltd were named as defendants in group action claims for damages filed in the courts of England. These claims were filed on behalf of certain individuals, governments, businesses and communities in Brazil allegedly impacted by the Samarco dam failure. The amount of damages sought in these claims is unspecified. In August 2019, the BHP parties filed a preliminary application to strike out or stay this action on jurisdictional and other procedural grounds. That application was successful before the High Court and the action was dismissed. However, on 8 July 2022, the Court of Appeal reversed the dismissal decision and allowed the action to proceed in England. The BHP defendants have sought permission to appeal to the Supreme Court of the United Kingdom and await a decision from the Supreme Court on their permission application.

On 2 December 2022, the BHP defendants filed their defence and a contribution claim against Vale. The contribution claim contends that if BHP’s defence is not successful and they are ordered to pay damages to the claimants, Vale should contribute to any amount payable.

F-18

BHP Results for the half year ended 31 December 2022

Criminal charges

The Federal Prosecutors’ Office has filed criminal charges against BHP Brasil, Samarco and Vale and certain employees and former employees of BHP Brasil (Affected Individuals) in the Federal Court of Ponte Nova, Minas Gerais. On 3 March 2017, BHP Brasil filed its preliminary defences. The Federal Court terminated the charges against eight of the Affected Individuals. The Federal Prosecutors’ Office has appealed seven of those decisions with hearings of the appeals still pending. BHP Brasil rejects outright the charges against the company and the Affected Individuals and is defending itself from all charges while fully supporting each of the Affected Individuals in their defence of the charges.

Civil public action commenced by Associations concerning the use of Tanfloc for water treatment

The Vila Lenira Residents Association, State of Espirito Santo Rural Producers and Artisans Association, Colatina Velha Neighbourhood Residents Association, and United for the Progress of Palmeiras Neighbourhood Association have filed a lawsuit against Samarco, BHP Brasil and Vale and others, including the State of Minas Gerais, the State of Espirito Santo and the Federal Government. The plaintiffs allege that the defendants carried out a clandestine study on the citizens of the locations affected by the Fundão’s Dam Failure, using TANFLOC – a tannin-based flocculant/coagulant – that is currently used for wastewater treatment applications. The plaintiffs claim that this product allegedly put the population at risk due to its alleged experimental qualities.

The plaintiffs are seeking multiple kinds of relief – material damages, moral damages, loss of profits – and that the defendants should pay for water supply in all locations where there is no water source other than the Doce River.

On 25 July 2022, Samarco, BHP Brasil and Vale presented their defences individually, as well as the State of Minas Gerais, the State of Espirito Santo and the Federal Government. The Court’s decision is still pending.

Other claims

BHP Brasil is among the companies named as defendants in a number of legal proceedings initiated by individuals,

non-governmental

organisations (NGOs), corporations and governmental entities in Brazilian Federal and State courts following the Samarco dam failure. The other defendants include Vale, Samarco and Fundação Renova. The lawsuits include claims for compensation, environmental remediation and violations of Brazilian environmental and other laws, among other matters. The lawsuits seek various remedies including reparation costs, compensation to injured individuals and families of the deceased, recovery of personal and property losses, moral damages and injunctive relief. In addition, government inquiries and investigations relating to the Samarco dam failure have been commenced by numerous agencies of the Brazilian government and are ongoing.

Additional lawsuits and government investigations relating to the Samarco dam failure could be brought against BHP Brasil and possibly other BHP entities in Brazil or other jurisdictions.

BHP insurance

BHP has various third party general liability and directors and officers insurances for claims related to the Samarco dam failure made directly against BHP Brasil or other BHP entities, their directors and officers, including class actions. External insurers have been notified of the Samarco dam failure along with the third party claims and class actions referred to above. Recoveries related to general liability insurance are now considered complete. As at 31 December 2022, an insurance receivable has not been recognised for any potential recoveries in respect of ongoing matters.

Commitments

Under the terms of the Samarco joint venture agreement, BHP Brasil does not have an existing obligation to fund Samarco.

BHP has agreed to fund a total of up to US$915 million for the Fundação Renova programs during calendar year 2023. Any additional requests for funding or future investment provided would be subject to a future decision by BHP, accounted for at that time. To the extent that Samarco does not meet its Fundação funding obligations, each of BHP Brasil and Vale has funding obligations under the Framework Agreement in proportion to its 50 per cent shareholding in Samarco.

Samarco judicial reorganisation

Samarco filed for Judicial Reorganisation (JR) in April 2021, with the Commercial Courts of Belo Horizonte, State of Minas Gerais, Brazil (JR Court), after multiple enforcement actions taken by certain financial creditors of Samarco which threatened Samarco’s operations. The JR is an insolvency proceeding with a means for Samarco to seek to restructure its financial debts and establish a sustainable financial position that allows Samarco to continue to rebuild its operations and strengthen its ability to meet its Fundação Renova related funding obligations. Samarco’s operations have continued during the JR proceeding.

F-19

BHP Results for the half year ended 31 December 2022

According

to the list of creditors filed with the JR Court by the Judicial Administrators (who are in charge of a first review of the list of creditors filed by Samarco), Fundação Renova’s funding obligations undertaken by Samarco are not subject to the JR, although some financial creditors of Samarco have objected to this position. Some of such creditors filed challenges to the list of creditors filed by the Judicial Administrators, in order to, among other things, prevent Samarco from funding Fundação Renova. In December 2021, the Federal Court granted BHP Brasil’s request that Samarco be able to fund Fundação Renova obligations, overturning a temporary injunction against such funding previously granted by the State Court of Appeals of Minas Gerais (State Court) in October 2021. BHP Brasil also obtained a preliminary injunction from the Superior Court of Justice supporting the jurisdiction of the Federal Court, and not the State Court, in this specific matter. An appeal on the merits against this ruling by certain financial creditors is still to be ruled upon. Samarco has, with the support of BHP Brasil and Vale, continued to meet its Fundação Renova funding obligations.

In April 2022, Samarco presented a restructure proposal for voting at a meeting of its creditors (GMC) under the JR proceeding, which was rejected by certain of the Samarco financial creditors. Samarco, BHP Brasil and Vale subsequently each filed objections with the JR Court against the voting process regarding the rejection of the Samarco proposal. The Samarco financial creditors and Samarco’s employee unions then proposed alternative restructure proposals, which remain subject to ongoing consideration, including a legality check from the Judicial Administrators and the JR Court.

In August 2022, Samarco, BHP Brasil, Vale and certain financial creditors took part in a court sanctioned mediation process, however an agreement was unable to be reached.

In October 2022, the JR Court issued a ruling that extended the so-called stay period until April 2023, which provides Samarco with protection from enforcement actions by its creditors.

In November 2022, the JR Court issued rulings regarding various legal matters in the JR process. One ruling rejected the claims by certain financial creditors and the State Prosecutors of Minas Gerais (MPMG) that the corporate veil of Samarco should be pierced and that BHP Brasil and Vale should be held liable for the debts of Samarco that are subject to the JR. The MPMG has appealed this JR Court ruling. The JR Court also held that BHP Brasil and Vale are unable to vote their claims at a GMC and that employees unions and certain financial creditors are also unable to vote their claims at a GMC in relation to the respective restructure plans that they each proposed. Certain financial creditors have appealed this JR Court ruling. In addition, the JR Court dismissed

certain

motions filed by Samarco, BHP Brasil and Vale and hence confirmed the outcome of the GMC held in April 2021; that the Samarco restructure proposal is rejected. The parties are able to appeal these decisions to the State Court.

It is expected that there will be continuing litigation from financial creditors against Samarco and its shareholders over the course of the JR proceeding, including with respect to the treatment of Samarco’s Fundação Renova-related obligations and continued attempts to pierce Samarco’s corporate veil to hold BHP Brasil and Vale liable for Samarco’s debts. The duration and outcome of the JR remains uncertain with the potential for protracted litigation and appeals because, among other things, the Samarco JR is occurring under new and untested Brazilian bankruptcy legislation.

While the JR is not expected to affect Samarco’s obligation or commitment to make full redress for the 2015 Fundão dam failure, and is not expected to impact Fundação Renova’s ability to undertake that remediation and compensation, it is not possible to determine the outcomes of the JR or reliably estimate any impact that the reorganisation may have for BHP Brasil, including its share of the Samarco dam failure provisions.

F-20

BHP Results for the half year ended 31 December 2022

Key judgements and estimates

Judgements

The outcomes of litigation are inherently difficult to predict and significant judgement has been applied in assessing the likely outcome of legal claims and determining which legal claims require recognition of a provision or disclosure of a contingent liability. The facts and circumstances relating to these cases are regularly evaluated in determining whether a provision for any specific claim is required.

Management has determined that a provision can only be recognised for obligations under the Framework Agreement and Samarco Germano dam decommissioning as at 31 December 2022. It is not yet possible to provide a range of possible outcomes or a reliable estimate of potential future exposures to BHP in connection to the contingent liabilities noted above, given their status.

Estimates

The provision for the Samarco dam failure currently only reflects the Group’s estimate of the remaining costs to complete Programs under the Framework Agreement and requires the use of significant judgements, estimates and assumptions. Based on current estimates, it is expected that approximately

80

 per cent of remaining costs for Programs under the Framework Agreement will be incurred by December

2024

.

While the provisions have been measured based on the latest information available as at 31 December 2022, changes in facts and circumstances are likely in future reporting periods and may lead to revisions to these estimates. However, it is currently not possible to determine what facts and circumstances may change, therefore revisions in future reporting periods due to the key estimates and factors outlined below cannot be reliably measured.

The key estimates that may have a material impact upon the provisions in the next and future reporting periods include the:

• number of people eligible for financial assistance and compensation and the corresponding amount of expected compensation; and

• costs to complete key infrastructure programs.

The provision may also be affected by factors including but not limited to:

• potential changes in scope of work and funding amounts required under the Framework Agreement including the impact of the decisions of the Interfederative Committee along with further technical analysis, community participation required under the Governance Agreement and rulings made by the Federal Court;

• the outcome of ongoing negotiations with State and Federal Prosecutors, including review of Fundação Renova’s Programs as provided in the Governance Agreement;

• actual costs incurred;

• resolution of uncertainty in respect of the nature and extent of Samarco’s long term cash generation;

• updates to discount and foreign exchange rates; and

• the outcomes of Samarco’s judicial reorganisation.

In addition, the provision may be impacted by decisions in, or resolution of, existing and potential legal claims in Brazil and other jurisdictions, including the outcome of the United Kingdom group action complaint and the negotiations seeking a definitive and substantive settlement of the obligations under the Framework Agreement and the R$155 billion (approximately US$30 billion) Federal Public Prosecution Office claim.

Outcomes of the negotiations are highly uncertain and it is therefore not possible to provide a reliable estimate of potential outcomes.

Given these factors, future actual cash outflows may differ from the amounts currently provided and changes to any of the key assumptions and estimates outlined above could result in a material impact to the provision in the next and future reporting periods.

F-21

BHP Results for the half year ended 31 December 2022

10. Subsequent events

Other

than

the matters outlined elsewhere in this Financial Report, no matters or circumstances have arisen since the end of the half year that have significantly affected, or may significantly affect, the operations, results of operations or state of affairs of the Group in subsequent accounting periods.

F-22

BHP Results for the half year ended 31 December 2022

Directors’ Report

The Directors present their report together with the half year Financial Statements for the half year ended 31 December 2022.

Review of Operations

A detailed review of the Group’s operated and

non-operated

assets, the results of those operations during the half year ended 31 December 2022 and likely future developments are given on pages 1 to 23. The Review of Operations has been incorporated into, and forms part of, this Directors’ Report.

Principal Risks and Uncertainties

The principal risks affecting the Group are described in OFR 9.1 of the Group’s Annual Report on Form

20-F

for the year ended 30 June 2022 and are grouped into the categories of risks listed below. Our principal risks may occur as a result of our activities globally, including in connection with our operated and

non-operated

assets, third parties engaged by BHP or through our value chain. Our principal risks, individually or collectively, could threaten our viability, strategy, business model, future performance, solvency or liquidity and reputation. They could also materially and adversely affect the health and safety of our people or members of the public, the environment, the communities where we or our third-party partners operate, or the interests of our stakeholders, which could in each case, lead to litigation, regulatory investigation or enforcement action (including class actions or actions arising from contractual, legacy or other liabilities associated with divested assets), or a loss of stakeholder and/or investor confidence. There are no material changes in those risk factors for the first six months of this financial year except to the extent described in the ‘Outlook’ section.

• Operational events : Risks associated with operational events in connection with our activities globally.

• Accessing key markets : Risks associated with market concentration and our ability to sell and deliver products into existing and future key markets.

• Optimising growth and portfolio returns : Risks associated with our ability to position our asset portfolio to generate returns and value for shareholders, including through acquisitions, mergers and divestments.

• Significant social or environmental impacts : Risks associated with significant impacts of our operations on and contributions to communities and environments throughout the life cycle of our assets and across our value chain.

• Inadequate business resilience: Risks associated with unanticipated or unforeseeable adverse events and a failure of planning and preparedness to respond to, manage and recover from adverse events (including potential physical impacts of climate change).

• Low-carbon transition : Risks associated with the transition to a low-carbon economy.

• Adopting technologies and maintaining digital  security : Risks associated with adopting and implementing new technologies, and maintaining the effectiveness of our existing digital landscape (including cyber defences) across our value chain.

• Ethical misconduct : Risks associated with actual or alleged deviation from societal or business expectations of ethical behaviour (including breaches of laws or regulations) and wider or cumulative organisational cultural failings.

F-23

Board of Directors

The Directors of BHP at any time during or since the end of the half year ended 31 December 2022 are:

Ken MacKenzie – Chairman since 1 September 2017 (a Director since 22 September 2016)

Mike Henry – an Executive Director since 1 January 2020

Terry Bowen – a Director since 1 October 2017

Malcolm Broomhead – a former Director from 31 March 2010 to 10 November 2022

Xiaoqun Clever – a Director since 1 October 2020

Ian Cockerill – a Director since 1 April 2019

Gary Goldberg – a Director since 1 February 2020

Michelle Hinchliffe – a Director since 1 March 2022

John Mogford – a former Director from 1 October 2017 to 31 October 2022

Christine O’Reilly – a Director since 12 October 2020

Catherine Tanna – a Director since 4 April 2022

Dion Weisler – a Director since 1 June 2020

Rounding of amounts

BHP Group Limited is an entity to which Australian Securities and Investments Commission (ASIC) Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 dated 24 March 2016 applies. Amounts in the Directors’ Report and half year Financial Statements have been rounded to the nearest million dollars in accordance with ASIC Instrument 2016/191.

Signed in accordance with a resolution of the Board of Directors.

Ken MacKenzie – Chairman

Mike Henry – Chief Executive Officer

Dated this 21st day of February 2023

F-24

BHP

BHP

Non-IFRS

Financial

Information

Half year ended

31 December 2022

Non-IFRS

Financial Information

Non-IFRS

financial information

We use various

non-IFRS

financial information to reflect our underlying financial performance.

Non-IFRS

financial information is not defined or specified under the requirements of IFRS, but is derived from the Group’s Consolidated Financial Statements prepared in accordance with IFRS. The

non-IFRS

financial information and the below reconciliations included in this document are unaudited. The

non-IFRS

financial information presented is consistent with how management review financial performance of the Group with the Board and the investment community.

The “Definition and calculation of

non-IFRS

financial information” section outlines why we believe

non-IFRS

financial information is useful and the calculation methodology. We believe

non-IFRS

financial information provides useful information, however should not be considered as an indication of, or as a substitute for, statutory measures as an indicator of actual operating performance (such as profit or net operating cash flow) or any other measure of financial performance or position presented in accordance with IFRS, or as a measure of a company’s profitability, liquidity or financial position.

The following tables provide reconciliations between

non-IFRS

financial information and their nearest respective IFRS measure.

Exceptional items

To improve the comparability of underlying financial performance between reporting periods, some of our

non-IFRS

financial information adjusts the relevant IFRS measures for exceptional items. Refer to the Group’s Financial Report for further information on exceptional items.

Exceptional items are those gains or losses where their nature, including the expected frequency of the events giving rise to them, and impact is considered material to the Group’s Consolidated Financial Statements. The exceptional items included within the Group’s profit from Continuing and Discontinued operations for the financial periods are detailed below.

Half year ended 31 December	2022 US$M			2021 US$M
Continuing operations
Revenue		–			–
Other income		–			–
Expenses excluding net finance costs, depreciation, amortisation and impairments		(47	)		(27	)
Depreciation and amortisation		–			–
Net impairments		–			–
Profit/(loss) from equity accounted investments, related impairments and expenses		127			(702	)
Profit/(loss) from operations		80			(729	)
Financial expenses		(222	)		(93	)
Financial income		–			–
Net finance costs		(222	)		(93	)
Profit/(loss) before taxation		(142	)		(822	)
Income tax benefit/(expense)		2			(422	)
Royalty-related taxation (net of income tax benefit)		–			–
Total taxation benefit/(expense)		2			(422	)
Profit/(loss) after taxation from Continuing operations		(140	)		(1,244	)
Discontinued operations
Profit/(loss) after taxation from Discontinued operations		–			–
Profit/(loss) after taxation from Continuing and Discontinued operations		(140	)		(1,244	)
Total exceptional items attributable to non-controlling interests		–			–
Total exceptional items attributable to BHP shareholders		(140	)		(1,244	)
Exceptional items attributable to BHP shareholders per share (US cents)		(2.8	)		(24.6	)
Weighted basic average number of shares (Million)		5,064			5,061

R-2

BHP Results for the half year ended 31 December 2022

Non-IFRS financial information derived from Consolidated Income Statement

Underlying attributable profit

Half year ended 31 December	2022   US$M		2021   US$M
Profit after taxation from Continuing and Discontinued operations attributable to BHP shareholders		6,457		9,443
Total exceptional items attributable to BHP shareholders 1		140		1,244
Underlying attributable profit		6,597		10,687

1 Refer to Exceptional items for further information.

Underlying basic earnings per ordinary share

Half year ended 31 December	2022 US cents		2021 US cents
Basic earnings per ordinary share		127.5		186.6
Exceptional items attributable to BHP shareholders per share 1		2.8		24.6
Underlying basic earnings per ordinary share		130.3		211.2

1 Refer to Exceptional items for further information.

Underlying attributable profit – Continuing operations

Half year ended 31 December	2022   US$M		2021   US$M
Profit after taxation from Continuing and Discontinued operations attributable to BHP shareholders		6,457		9,443
(Profit) after taxation from Discontinued operations attributable to BHP shareholders		–		(972	)
Total exceptional items attributable to BHP shareholders 1		140		1,244
Underlying attributable profit – Continuing operations		6,597		9,715

1 Refer to Exceptional items for further information.

Underlying basic earnings per ordinary share – Continuing operations

Half year ended 31 December	2022   US$M		2021   US$M
Underlying attributable profit – Continuing operations		6,597		9,715
Weighted basic average number of shares (Million)		5,064		5,061
Underlying attributable earnings per ordinary share – Continuing operations (US cents)		130.3		192.0

Underlying EBITDA

Half year ended 31 December	2022   US$M			2021   US$M
Profit from operations		10,833			14,845
Exceptional items included in profit from operations 1		(80	)		729
Underlying EBIT		10,753			15,574
Depreciation and amortisation expense		2,456			2,851
Net impairments		21			38
Underlying EBITDA		13,230			18,463

1 Refer to Exceptional items for further information.

R-3

Non-IFRS

Financial Information

Underlying EBITDA margin

Half year ended 31 December 2022 US$M	Copper			Iron Ore			Coal			Group and unallocated items/ eliminations 1		Total Group
Revenue – Group production		6,317			11,813			5,566			1,010		24,706
Revenue – Third- party products		988			9			–			10		1,007
Revenue		7,305			11,822			5,566			1,020		25,713
Underlying EBITDA – Group production		2,806			7,641			2,631			144		13,222
Underlying EBITDA – Third- party products		8			–			–			–		8
Underlying EBITDA 2		2,814			7,641			2,631			144		13,230
Segment contribution to the Group’s Underlying EBITDA 3		22	%		58	%		20	%				100	%
Underlying EBITDA margin 4		44	%		65	%		47	%				54	%

Half year ended 31 December 2021 US$M	Copper			Iron Ore			Coal			Group and unallocated items/ eliminations 1		Total Group
Revenue – Group production		6,857			15,809			5,368			819		28,853
Revenue – Third- party products		1,637			9			–			28		1,674
Revenue		8,494			15,818			5,368			847		30,527
Underlying EBITDA – Group production		4,262			11,153			2,642			396		18,453
Underlying EBITDA – Third- party products		10			–			–			–		10
Underlying EBITDA 2		4,272			11,153			2,642			396		18,463
Segment contribution to the Group’s Underlying EBITDA 3		24	%		61	%		15	%				100	%
Underlying EBITDA margin 4		62	%		71	%		49	%				64	%

1 Group and unallocated items includes functions, other unallocated operations including Potash, Nickel West, legacy assets and consolidation adjustments.

2 Refer to Underlying EBITDA for further information.

3 Percentage contribution to Group Underlying EBITDA, excluding Group and unallocated items.

4 Underlying EBITDA margin excludes Third- party products.

Non- IFRS financial information derived from Consolidated Cash Flow Statement

Capital and exploration expenditure

Half year ended 31 December	2022 US$M		2021 US$M
Capital expenditure (purchases of property, plant and equipment)		2,871		2,768
Add: Exploration expenditure		156		110
Capital and exploration expenditure (cash basis) – Continuing operations		3,027		2,878
Capital expenditure (purchases of property, plant and equipment) – Discontinued operations		–		556
Add: Exploration expenditure – Discontinued operations		–		243
Capital and exploration expenditure (cash basis) – Discontinued operations		–		799
Capital and exploration expenditure (cash basis) – Total operations		3,027		3,677

Free cash flow

Half year ended 31 December	2022 US$M			2021 US$M
Net operating cash flows from Continuing operations		6,770			11,529
Net investing cash flows from Continuing operations		(3,289	)		(3,045	)
Free cash flow – Continuing operations		3,481			8,484
Net operating cash flows from Discontinued operations		–			1,748
Net investing cash flows from Discontinued operations		–			(544	)
Free cash flow – Discontinued operations		–			1,204
Free cash flow – Total operations		3,481			9,688

R-4

BHP Results for the half year ended 31 December 2022

Non-IFRS

financial information derived from Consolidated Balance Sheet

Net debt and gearing ratio

	31 Dec 2022 US$M			31 Dec 2021 US$M			30 June 2022 US$M
Interest bearing liabilities – Current		2,015			3,054			2,622
Interest bearing liabilities – Non current		12,686			15,897			13,806
Total interest bearing liabilities		14,701			18,951			16,428
Comprising:
Borrowing		12,007			15,935			13,852
Lease liabilities		2,694			3,016			2,576
Less: Lease liability associated with index-linked freight contracts		247			540			274
Less: Cash and cash equivalents		9,605			12,366			17,236
Less: Net debt management related instruments 1		(2,063	)		(38	)		(1,688	)
Less: Net cash management related instruments 2		2			(7	)		273
Less: Total derivatives included in net debt		(2,061	)		(45	)		(1,415	)
Net debt		6,910			6,090			333
Net assets		46,552			54,922			48,766
Gearing		12.9	%		10.0	%		0.7	%

1 Represents the net cross currency and interest rate swaps included within current and non-current other financial assets and liabilities.

2 Represents the net forward exchange contracts related to cash management included within current and non-current other financial assets and liabilities.

Net debt waterfall

	31 Dec 2022 US$M			31 Dec 2021 US$M
Net debt at the beginning of the period		(333	)		(4,121	)
Net operating cash flows		6,770			13,277
Net investing cash flows		(3,289	)		(3,589	)
Net financing cash flows		(10,911	)		(12,506	)
Net decrease in cash and cash equivalents from Continuing and Discontinued operations		(7,430	)		(2,818	)
Carrying value of interest bearing liability net repayments		1,340			1,185
Carrying value of debt related instruments settlements		383			–
Carrying value of cash management related instruments (proceeds)		(274	)		(33	)
Fair value adjustment on debt (including debt related instruments)		98			25
Foreign exchange impacts on cash		(201	)		(62	)
Lease additions		(320	)		(497	)
Transfer to liability directly associated with assets held for sale		–			528
Other		(173	)		(297	)
Non-cash movements		(596	)		(303	)
Net debt at the end of the period		(6,910	)		(6,090	)

R-5

Non-IFRS Financial Information

Net operating assets

	31 Dec 2022 US$M			31 Dec 2021 US$M
Net assets		46,552			54,922
Less: Non-operating assets
Cash and cash equivalents		(9,605	)		(12,366	)
Trade and other receivables 1		(22	)		(217	)
Other financial assets 2		(1,219	)		(1,432	)
Current tax assets		(444	)		(240	)
Deferred tax assets		(54	)		(94	)
Assets held for sale 3		–			(17,272	)
Add: Non-operating liabilities
Trade and other payables 4		149			161
Interest bearing liabilities		14,701			18,951
Other financial liabilities 5		2,276			908
Current tax payable		469			1,836
Non-current tax payable		65			94
Deferred tax liabilities		3,367			3,808
Liabilities directly associated with the assets held for sale 3		–			7,564
Net operating assets		56,235			56,623

1 Represents loans to associates, external finance receivable and accrued interest receivable included within other receivables.

2 Represents cross currency and interest rate swaps, forward exchange contracts related to cash management and investment in shares, other investments and receivables contingent on outcome of future events relating to mining and regulatory approvals.

3 Represents Petroleum assets and liabilities as at 31 December 2021 that were merged with Woodside on 1 June 2022.

4 Represents accrued interest payable included within other payables.

5 Represents cross currency and interest rate swaps and forward exchange contracts related to cash management.

R-6

BHP Results for the half year ended 31 December 2022

Other

non-IFRS

financial information

Principal factors that affect Revenue, Profit from operations and Underlying EBITDA

The following table describes the impact of the principal factors that affected Revenue, Profit from operations and Underlying EBITDA for half year ended 31 December 2022 and relates them back to our Consolidated Income Statement.

	Revenue US$M			Total expenses, Other income and Profit/(loss) from equity accounted investments US$M			Profit from operations US$M			Depreciation, amortisation and impairments and Exceptional Items US$M			Underlying EBITDA US$M
Half year ended 31 December 2021
Revenue		30,527
Other income					414
Expenses excluding net finance costs					(15,742	)
Loss from equity accounted investments, related impairments and expenses					(354	)
Total other income, expenses excluding net finance costs and Loss from equity accounted investments, related impairments and expenses					(15,682	)
Profit from operations								14,845
Depreciation, amortisation and impairments											2,889
Exceptional item included in Depreciation, amortisation and impairments											–
Exceptional items											729
Underlying EBITDA														18,463
Change in sales prices		(3,983	)		434			(3,549	)		–			(3,549	)
Price-linked costs		–			(333	)		(333	)		–			(333	)
Net price impact		(3,983	)		101			(3,882	)		–			(3,882	)
Change in volumes		772			(68	)		704			–			704
Operating cash costs		–			(471	)		(471	)		–			(471	)
Exploration and business development		–			(46	)		(46	)		–			(46	)
Change in controllable cash costs		–			(517	)		(517	)		–			(517	)
Exchange rates		(6	)		400			394			–			394
Inflation on costs		–			(663	)		(663	)		–			(663	)
Fuel, energy, and consumable price movements		–			(383	)		(383	)		–			(383	)
Non-cash		–			(17	)		(17	)		–			(17	)
One-off items		–			–			–			–			–
Change in other costs		(6	)		(663	)		(669	)		–			(669	)
Asset sales		–			6			6			–			6
Ceased and sold operations		(952	)		482			(470	)		–			(470	)
Other		(645	)		240			(405	)		–			(405	)
Depreciation, amortisation and impairments		–			412			412			(412	)		–
Exceptional items		–			809			809			(809	)		–
Half year ended 31 December 2022
Revenue		25,713
Other income					269
Expenses excluding net finance costs					(15,429	)
Profit from equity accounted investments, related impairments and expenses					280
Total other income, expenses excluding net finance costs and Profit from equity accounted investments, related impairments and expenses					(14,880	)
Profit from operations								10,833
Depreciation, amortisation and impairments											2,477
Exceptional item included in Depreciation, amortisation and impairments											–
Exceptional items											(80	)
Underlying EBITDA														13,230

R-7

Non-IFRS Financial Information

Underlying return on capital employed (ROCE)

	31 Dec 2022 US$M			31 Dec 2021 US$M
Profit after taxation from Continuing and Discontinued operations		7,126			10,506
Exceptional items 1		140			1,244
Subtotal		7,266			11,750
Adjusted for:
Net finance costs		652			397
Exceptional items included within net finance costs 1		(222	)		(93	)
Income tax expense on net finance costs		(166	)		(118	)
Profit after taxation excluding net finance costs and exceptional items		7,530			11,936
Annualised Profit after taxation excluding net finance costs and exceptional items		15,060			23,872
Net assets at the beginning of the period		48,766			55,605
Net debt at the beginning of the period		333			4,121
Capital employed at the beginning of the period		49,099			59,726
Net assets at the end of the period		46,552			54,922
Net debt at the end of the period		6,910			6,090
Capital employed at the end of the period		53,462			61,012
Average capital employed		51,281			60,369
Underlying Return on Capital Employed		29.4	%		39.5	%

1 Refer to Exceptional items for further information.

Underlying return on capital employed (ROCE) by segment

Half year ended 31 December 2022 US$M	Copper			Iron Ore			Coal			Group and unallocated items/ eliminations 1			Total Continuing			Petroleum Discontinued operations		Total Group
Annualised profit after taxation excluding net finance costs and exceptional items		2,776			9,352			3,250			(318	)		15,060			–		15,060
Average capital employed		25,202			15,255			5,934			4,890			51,281			–		51,281
Underlying Return on Capital Employed		11	%		61	%		55	%		–			29.4	%		–		29.4	%

Half year ended 31 December 2021 US$M	Copper			Iron Ore			Coal			Group and unallocated items/ eliminations 1		Total Continuing			Petroleum Discontinued operations			Total Group
Annualised profit after taxation excluding net finance costs and exceptional items		4,208			14,428			3,160			70		21,866			2,006			23,872
Average capital employed		24,061			15,250			7,802			3,869		50,982			9,387			60,369
Underlying Return on Capital Employed		17	%		95	%		41	%		–		42.9	%		21.4	%		39.5	%

1 Group and unallocated items includes functions, other unallocated operations including Potash, Nickel West, legacy assets and consolidation adjustments.

R-8

BHP Results for the half year ended 31 December 2022

Underlying return on capital employed (ROCE) by asset

Half year ended 31 December 2022 US$M	Western Australia Iron Ore			BHP Mitsubishi Alliance			Antamina			Nickel West			Escondida			Pampa Norte			Olympic Dam			Potash			New South Wales Energy Coal 1			Other			Total Continuing			Petroleum Discontinued operations		Total Group
Annualised profit after taxation excluding net finance costs and exceptional items		9,362			1,626			346			(2	)		2,464			86			98			(114	)		1,706			(512	)		15,060			–		15,060
Average capital employed		19,123			6,250			1,308			1,089			10,209			4,498			9,189			3,789			(546	)		(3,628	)		51,281			–		51,281
Underlying Return on Capital Employed		49	%		26	%		26	%		(0	%)		24	%		2	%		1	%		(3	%)		–			–			29.4	%		–		29.4	%

Half year ended 31 December 2021 US$M	Western Australia Iron Ore			BHP Mitsubishi Alliance			Antamina			Nickel West			Escondida			Pampa Norte			Olympic Dam			Potash			New South Wales Energy Coal 1			Other			Total Continuing			Petroleum Discontinued operations			Total Group
Annualised profit after taxation excluding net finance costs and exceptional items		14,672			2,134			724			128			3,312			500			(154	)		(108	)		532			126			21,866			2,006			23,872
Average capital employed		18,535			7,282			1,312			569			9,662			4,376			8,585			3,178			(308	)		(2,209	)		50,982			9,387			60,369
Underlying Return on Capital Employed		79	%		29	%		55	%		22	%		34	%		11	%		(2	%)		(3	%)		–			–			42.9	%		21.4	%		39.5	%

1 NSWEC has not been shown as ROCE is distorted by negative capital employed due to the rehabilitation provision being the primary balance remaining on Balance Sheet following previous impairments.

R-9

Non-IFRS

Financial Information

Definition and calculation of

Non-IFRS

financial information

Non-IFRS financial information	Reasons why we believe the non-IFRS financial information are useful	Calculation methodology
Underlying attributable profit	Allows the comparability of underlying financial performance by excluding the impacts of exceptional items.	Profit after taxation from Continuing and Discontinued operations attributable to BHP shareholders excluding any exceptional items attributable to BHP shareholders.
Underlying attributable profit – Continuing operations	Allows the comparability of underlying financial performance by excluding the impacts of exceptional items and the contribution of Discontinued operations and is also the basis on which our dividend payout ratio policy is applied.	Underlying attributable profit from Continuing operations also excludes the contribution of Discontinued operations from the above metrics.
Underlying basic earnings per share	On a per share basis, allows the comparability of underlying financial performance by excluding the impacts of exceptional items.	Underlying attributable profit divided by the weighted basic average number of shares.
Underlying basic earnings per share – Continuing operations	On a per share basis, allows the comparability of underlying financial performance by excluding the impacts of exceptional items and the contribution of Discontinued operations.	Underlying attributable profit – Continuing operations divided by the weighted basic average number of shares.
Underlying EBITDA	Used to help assess current operational profitability excluding the impacts of sunk costs (i.e. depreciation from initial investment). Each is a measure that management uses internally to assess the performance of the Group’s segments and make decisions on the allocation of resources.	Earnings before net finance costs, depreciation, amortisation and impairments, taxation expense, Discontinued operations and exceptional items. Underlying EBITDA includes BHP’s share of profit/(loss) from investments accounted for using the equity method including net finance costs, depreciation, amortisation and impairments and taxation expense/(benefit).
Underlying EBITDA margin		Underlying EBITDA excluding third party product EBITDA, divided by revenue excluding third party product revenue.
Underlying EBIT	Used to help assess current operational profitability excluding net finance costs and taxation expense (each of which are managed at the Group level) as well as Discontinued operations and any exceptional items.	Earnings before net finance costs, taxation expense, Discontinued operations and any exceptional items. Underlying EBIT includes BHP’s share of profit/(loss) from investments accounted for using the equity method including net finance costs and taxation expense/(benefit).
Profit from operations		Earnings before net finance costs, taxation expense and Discontinued operations. Profit from operations includes Revenue, Other income, Expenses excluding net finance costs and BHP’s share of profit/(loss) from investments accounted for using the equity method including net finance costs and taxation expense/(benefit).
Capital and exploration expenditure	Used as part of our Capital Allocation Framework to assess efficient deployment of capital. Represents the total outflows of our operational investing expenditure.	Purchases of property, plant and equipment and exploration expenditure including the contribution of Discontinued operations.
Capital and exploration expenditure – Continuing operations	Represents the total outflows of our operational investing expenditure excluding the contribution of Discontinued operations.	Purchases of property, plant and equipment and exploration expenditure.

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BHP Results for the half year ended 31 December 2022

Non-IFRS financial information	Reasons why we believe the non-IFRS financial information are useful	Calculation methodology
Free cash flow	It is a key measure used as part of our Capital Allocation Framework. Reflects our operational cash performance inclusive of investment expenditure, which helps to highlight how much cash was generated in the period to be available for the servicing of debt and distribution to shareholders. Reflects our operational cash performance inclusive of investment expenditure, but excluding the contribution of Discontinued operations.	Net operating cash flows less net investing cash flows.
Free cash flow – Continuing operations		Net operating cash flows from Continuing operations less net investing cash flows from Continuing operations.
Net debt	Net debt shows the position of gross debt less index-linked freight contracts offset by cash immediately available to pay debt if required and any associated derivative financial instruments. Liability associated with index-linked freight contracts, which are required to be remeasured to the prevailing freight index at each reporting date, are excluded from the net debt calculation due to the short-term volatility of the index they relate to not aligning with how the Group uses net debt for decision making in relation to the Capital Allocation Framework. Net debt includes the fair value of derivative financial instruments used to hedge cash and borrowings to reflect the Group’s risk management strategy of reducing the volatility of net debt caused by fluctuations in foreign exchange and interest rates. Net debt, along with the gearing ratio, is used to monitor the Group’s capital management by relating net debt relative to equity from shareholders.	Interest bearing liabilities less liability associated with index-linked freight contracts less cash and cash equivalents less net cross currency and interest rate swaps less net cash management related instruments for the Group at the reporting date.
Gearing ratio		Ratio of Net debt to Net debt plus Net assets.
Net operating assets	Enables a clearer view of the assets deployed to generate earnings by highlighting the net operating assets of the business separate from the financing and tax balances. This measure helps provide an indicator of the underlying performance of our assets and enhances comparability between them.	Operating assets net of operating liabilities, including the carrying value of equity accounted investments and predominantly excludes cash balances, loans to associates, interest bearing liabilities, derivatives hedging our net debt, assets held for sale, liabilities directly associated with assets held for sale and tax balances.
Underlying return on capital employed (ROCE)	Indicator of the Group’s capital efficiency and is provided on an underlying basis to allow comparability of underlying financial performance by excluding the impacts of exceptional items.	Profit after taxation excluding exceptional items and net finance costs (after taxation) divided by average capital employed. Profit after taxation excluding exceptional items and net finance costs (after taxation) is profit after taxation from Continuing and Discontinued operations excluding exceptional items, net finance costs and the estimated taxation impact of net finance costs. These are annualised for a half year end reporting period. The estimated tax impact is calculated using a prima facie taxation rate on net finance costs (excluding any foreign exchange impact). Average capital employed is calculated as the average of net assets less net debt for the last two reporting periods.

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Non-IFRS

Financial Information

Non-IFRS financial information	Reasons why we believe the non-IFRS financial information are useful	Calculation methodology
Adjusted effective tax rate	Provides an underlying tax basis to allow comparability of underlying financial performance by excluding the impacts of exceptional items.	Total taxation expense/(benefit) excluding exceptional items and exchange rate movements included in taxation expense/(benefit) divided by Profit before taxation from Continuing operations excluding exceptional items.
Unit cost	Used to assess the controllable financial performance of the Group’s assets for each unit of production. Unit costs are adjusted for site specific non controllable factors to enhance comparability between the Group’s assets.	Ratio of net costs of the assets to the equity share of sales tonnage. Net costs is defined as revenue less Underlying EBITDA and excludes freight and other costs, depending on the nature of each asset. Freight is excluded as the Group believes it provides a similar basis of comparison to our peer group. Escondida unit costs exclude: •  by-product credits being the favourable impact of by-products (such as gold or silver) to determine the directly attributable costs of copper production. WAIO, BMA and NSWEC unit costs exclude: •  royalties as these are costs that are not deemed to be under the Group’s control, and the Group believes exclusion provides a similar basis of comparison to our peer group.

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BHP Results for the half year ended 31 December 2022

Definition and calculation of principal factors

The method of calculation of the principal factors that affect the period on period movements of Revenue, Profit from operations and Underlying EBITDA are as follows:

Principal factor	Method of calculation
Change in sales prices	Change in average realised price for each operation from the prior period to the current period, multiplied by current period sales volumes.
Price-linked costs	Change in price-linked costs (mainly royalties) for each operation from the prior period to the current period, multiplied by current period sales volumes.
Change in volumes	Change in sales volumes for each operation multiplied by the prior year average realised price less variable unit cost.
Controllable cash costs	Total of operating cash costs and exploration and business development costs.
Operating cash costs	Change in total costs, other than price-linked costs, exchange rates, inflation on costs, fuel, energy, and consumable price movements, non-cash costs and one-off items as defined below for each operation from the prior period to the current period.
Exploration and business development	Exploration and business development expense in the current period minus exploration and business development expense in the prior period.
Exchange rates	Change in exchange rate multiplied by current period local currency revenue and expenses.
Inflation on costs	Change in inflation rate applied to expenses, other than depreciation and amortisation, price-linked costs, exploration and business development expenses, expenses in ceased and sold operations and expenses in new and acquired operations.
Fuel, energy, and consumable price movements	Fuel and energy expense and price differences above inflation on consumables in the current period minus fuel and energy expense in the prior period.
Non-cash	Change in net impact of capitalisation and depletion of deferred stripping from the prior period to the current period.
One-off items	Change in costs exceeding a pre-determined threshold associated with an unexpected event that had not occurred in the last two years and is not reasonably likely to occur within the next two years.
Asset sales	Profit/(loss) on the sale of assets or operations in the current period minus profit/(loss) on sale of assets or operations in the prior period.
Ceased and sold operations	Underlying EBITDA for operations that ceased or were sold in the current period minus Underlying EBITDA for operations that ceased or were sold in the prior period.
Share of profit/(loss) from equity accounted investments	Share of profit/(loss) from equity accounted investments for the current period minus share of profit/(loss) from equity accounted investments in the prior period.
Other	Variances not explained by the above factors.

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Non-IFRS

Financial Information

Definition and calculation of Key Indicator terms

We use various Key Indicators to reflect our sustainability performance.

Management uses these Key Indicators to evaluate BHP’s performance against both positive and negative impacts of operational activities and our progress against our sustainability commitments and targets.

This section outlines why we believe the Key Indicators are useful to the Board, management, investors and other stakeholders, and the methodology behind the metrics. A definition and explanation of each of the Key Indicators are provided in the tables below.

Health and safety-related metrics

Our highest priority is the safety of our people and the communities in which we operate. This is why are focussed on introducing more reliable and effective controls across our safety risk profile and improving human and organisational performance, enabling our people to work safely each day. Our work in fatality elimination is underpinned by our field leadership program, ensuring our leaders are spending quality time in field engaging with our workforce. The health and safety Key Indicators allow the Board, management, investors and other stakeholders to measure and track health and safety performance at our operated assets.

Key Indicator	Calculation methodology
High Potential Injury (HPI)	High potential injury frequency (HPIF) is an indicator which measures the number of injuries with fatal potential per million hours. HPIF equals the sum of (lost time cases + restricted work cases + medical treatment cases + first aid cases) x 1,000,000 ÷ total hours worked. High potential injuries remain a primary focus to assess progress against our most important safety objective: to eliminate fatalities. The basis of calculation for high potential injuries was revised in FY2020 from event count to injury count as part of a safety reporting methodology improvement. In some events, multiple people are injured. This methodology has been prepared in accordance with GRI standard 403-9.
Total Recordable Injury Frequency (TRIF)	Total recordable injury frequency (TRIF) is an indicator which measures the number of recordable injuries per million hours. TRIF equals the sum of (fatalities + lost-time cases + restricted work cases + medical treatment cases) x 1,000,000 ÷ total hours worked total exposure hours. BHP adopts the US Government Occupational Safety and Health Administration (OSHA) guidelines for the recording and reporting of occupational injury and illnesses. TRIF statistics exclude non-operated assets. Year-on-year improvement of TRIF is one of our five-year sustainability targets and is one of the indicators used to assess our safety performance. This methodology has been prepared in accordance with GRI standard 403-9 and OSHA guidelines.

Climate change-related metrics

Climate change-related risks are assessed to determine their potential impacts and likelihood, enable prioritisation and determine risk treatment options. We then implement controls designed to prevent, minimise or mitigate threats, and enable or enhance opportunities. Risks and controls are reviewed periodically and on an ad hoc basis to evaluate performance. Climate-related risks can be grouped into two categories:

• Transition risks arise from policy, regulatory, legal, technological, market and other societal responses to the challenges posed by climate change and the transition to a low-carbon economy and

• Physical risks refer to acute risks that are event-driven, including increased severity and frequency of extreme weather events, and chronic risks resulting from longer-term changes in climate patterns.

Our climate change Key Indicators help us monitor our climate change commitments to mitigate the risks and potential impacts associated with climate change to BHP, as well as fulfil our regulatory reporting obligations. The Key Indicators allow the Board, management, investors and other stakeholders to measure BHP’s performance against these commitments.

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BHP Results for the half year ended 31 December 2022

Key Indicator	Calculation methodology
Operational GHG emissions (Scopes 1 and 2)	Operational greenhouse gas (GHG) emissions include Scopes 1 and 2 emissions calculated based on an operational control approach in accordance with the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard. Scope 1 refers to direct GHG emissions from operated assets. Scope 2 refers to indirect GHG emissions from the generation of purchased or acquired electricity, steam, heat or cooling that is consumed by operated assets. Calculation methodology Operational GHG emissions are calculated using activity data collected at our operated assets. Activity data is multiplied by an energy content (where necessary) and emission factors to derive the energy consumption and GHG emissions associated with a process or an operation. Examples of activity data include kilowatt-hours of electricity used or quantity of fuel used. Scope 2 emissions are calculated using market-based reporting. Market-based reporting calculates Scope 2 emissions based on the generators (and therefore the generation fuel mix) from which the reporting company contractually purchases electricity and/or is directly provided electricity via a direct line transfer. More information on the calculation methodologies, boundaries assumptions, adjustments and key references used in the preparation of our Scopes 1 and 2 emissions data can be found in our BHP Scope 1, 2 and 3 Emissions Calculation Methodology available at bhp.com/climate.
Value chain GHG emissions (Scope 3)	Definition Value chain greenhouse gas (GHG) emissions, also known as Scope 3 emissions, refers to all other indirect emissions (not included in Scope 2) that occur in BHP’s value chain. For BHP, these are primarily emissions resulting from our customers use and processing of the commodities supplied by BHP, as well as upstream emissions associated with the extraction, production and transportation of the goods, services, fuels and energy we purchase for use at our operations, emissions resulting from the transportation and distribution of our products, and operational emissions (on an equity basis) from our non-operated joint ventures. Methodology The Greenhouse Gas Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard categorises Scope 3 emissions into 15 distinct categories. Where relevant to BHP, we report Scope 3 emissions for our business according to these categories. More information on the calculation methodologies, boundaries assumptions and key references used in the preparation of our Scope 3 emissions data can be found in our BHP Scope 1, 2 and 3 Emissions Calculation Methodology available at bhp.com/climate.

People-related metrics

Our global workforce is the foundation of our business and we believe that supporting the wellbeing of our people and promoting an inclusive and diverse culture are vital for maintaining a competitive advantage. The proportion of the workforce that are female or Indigenous workers are key indicators, which allow the Board, management, investors and other stakeholders to measure and track our near and long-term progress.

Key Indicator	Calculation methodology
Female workforce participation (%)	The number of female employees as a proportion of the total workforce on the last day of the respective reporting period, used in internal management reporting for the purposes of monitoring progress against our goals.
Indigenous workforce participation (%)	The number of Indigenous employees as a proportion of the total workforce in the relevant employee population on the last day of the respective reporting period, used in internal management reporting for the purposes of monitoring progress against our goals. There is no significant seasonal variation in employment numbers. These methodologies have been prepared in accordance with GRI standard 102-8 and GRI standard 405-1.

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