The world’s largest mining group BHP (LON:BHP) posted forecast-beating FY earnings thanks to a surge in the copper price. For the first time, copper accounted for the largest share of the Anglo-Australian company’s operating profit.
Sales and earnings beat forecasts
For the year to June, BHP reported a 15% increase in revenue to $58.8 billion, slightly ahead of forecasts. Underlying EBITDA increased 27% to $32.9 billion, also beating forecasts and representing a margin of 59% against 53% in FY25.
| Est FY26 | Actual FY26 | Beat | |
| Revenue | $58.8bn | $58.1bn | 1.2% |
| EBITDA | $32.9bn | $32.4bn | 1.5% |
| Operating profit | $13.2bn | $12.6bn | 4.8% |
| EPS | $2.60 | $2.49 | 4.4% |
Source: BHP Ltd
Higher copper prices meant divisional EBITDA reached $18 billion, accounting for the majority of group profit for the first time. Thanks to cost savings, including at its Escondida mine, the underlying EBITDA margin for the copper business reached 70%.
New CEO has big growth plans
Newly-arrived CEO Brandon Craig described copper as ‘the engine driving BHP’s growth’. Thanks to the significant free cash flow it generates the business is now self-funding, and Craig has big plans.
‘We have a well-defined project pipeline across Chile, Australia and Argentina that can potentially lift copper production by around 40% by FY35’, said Craig. At Escondida, the firm approved US$0.5 billion in pre-commitment funding for a new concentrator ahead of a final investment decision in CY27-28. In Australia, it plans to build on record operational and financial performance at Copper SA.
‘We are also growing through partnerships, from Resolution in Arizona to Vicuña on the Argentina-Chile border, while maintaining exposure to future opportunities through our investment in Faraday Copper and an MOU with Sierra Gorda SCM’, added the CEO.
Meanwhile, in iron ore a new mine in the Pilbara will help maintain Western Australian output over 305 miilion tonnes/year and ‘further strengthen one of the most competitive businesses in the global mining industry.’
We aren’t mining experts, but like everyone else we’ve been watching the copper price rise all year. As the world’s biggest miner and copper producer, it’s no surprise BHP has been a big beneficiary.
By the firm’s own estimates, copper demand could rise from about 34 million tonnes/year today to over 50 million tonnes by 2050. China is expected to keep producing around a billion tonnes of steel per year this decade, while also investing heavily in its power grid.
At the same time, the US is investing in data centres, which are highly copper-intensive. And India is importing more raw materials, as the fastest growing major economy.
Rather than sitting back, the new CEO has what he calls a ‘pathway to growth’ to keep the company moving forward. That should go down well with investors, as should the commitment to continue raising the dividend and buying back shares.
