UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
August 24, 2011
| BHP BILLITON LIMITED | BHP BILLITON PLC | |
| (ABN 49 004 028 077) | (REG. NO. 3196209) | |
| (Exact name of Registrant as specified in its charter) | (Exact name of Registrant as specified in its charter) |
| VICTORIA, AUSTRALIA | ENGLAND AND WALES | |
| (Jurisdiction of incorporation or organisation) | (Jurisdiction of incorporation or organisation) | |
| 180 LONSDALE STREET, MELBOURNE, VICTORIA 3000 AUSTRALIA |
NEATHOUSE PLACE, VICTORIA, LONDON, UNITED KINGDOM (Address of principal executive offices) | |
| (Address of principal executive offices) | ||
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: x Form 20-F ¨ Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934: ¨ Yes x No
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): n/a
bhpbilliton
resourcing the future
24 August 2011
For Announcement to the Market
Name of Companies: BHP Billiton Limited (ABN 49 004 028 077) and BHP Billiton Plc (Registration No. 3196209)
Report for the year ended 30 June 2011
This statement includes the consolidated results of the BHP Billiton Group, comprising BHP Billiton Limited and BHP Billiton Plc, for the year ended 30 June 2011 compared with the year ended 30 June 2010.
The results are prepared in accordance with IFRS and are presented in US dollars.
US$ Million
Revenue up 35.9% to 71,739
Profit attributable to the members of the
BHP Billiton Group up 85.9% to 23,648
Net Tangible Asset Backing:
Net tangible assets per fully paid share were US$10.63 as at 30 June 2011, compared with US$8.70 at 30 June 2010.
Dividends per share:
Final dividend for current period US 55 cents fully franked
(record date 9 September 2011; payment date 29
September 2011)
Final dividend for previous corresponding period US 45 cents fully franked
This statement was approved by the Board of Directors.
Jane McAloon
Group Company Secretary
BHP Billiton Limited and BHP Billiton Plc
bhpbilliton
resourcing the future
NEWS RELEASE
Release Time IMMEDIATE
Date 24 August 2011
Number 26/11
BHP BILLITON RESULTS FOR THE YEAR ENDED 30 JUNE 2011
Record financial results including Underlying EBITDA(1) up 51% to US$37.1 billion, Underlying EBIT(1)(2) up 62% to US$32.0 billion and Attributable profit (excluding exceptional items) up 74% to US$21.7 billion.
Strong margins and returns illustrated by increase in Underlying EBIT margin(3) to 47% and Underlying return on capital to 39%.
Record production across four commodities and ten operations.
Record operating cash flow(4) of US$30.1 billion and gearing of 9% confirms capacity to comfortably fund the Group’s US$15.1 billion(5) acquisition of Petrohawk Energy Corporation and extensive organic growth program.
Completion of expanded US$10 billion capital management program highlights commitment to maintain an appropriate capital structure through all points of the economic cycle.
22% rebasing of final dividend for full year dividend payout of 101 US cents per share.
Year ended 30 June 2011 2010 Change
US$M US$M %
Revenue 71,739 52,798 35.9%
Underlying EBITDA(1) 37,093 24,513 51.3%
Underlying EBIT(1)(2) 31,980 19,719 62.2%
Profit from operations 31,816 20,031 58.8%
Attributable profit – excluding exceptional items 21,684 12,469 73.9%
Attributable profit 23,648 12,722 85.9%
Net operating cash flow(4) 30,080 16,890 78.1%
Basic earnings per share – excluding exceptional items (US cents) 393.5 224.1 75.6%
Basic earnings per share (US cents) 429.1 228.6 87.7%
Underlying EBITDA interest coverage (times)(1)(6) 102.8 64.4 59.6%
Dividend per share (US cents) 101.0 87.0 16.1%
Refer to page 15 for footnotes, including explanations of the non-GAAP measures used in this announcement. The financial results are prepared in accordance with IFRS and are unaudited. All references to the prior period are to the year ended 30 June 2010 unless otherwise stated.
News Release
RESULTS FOR THE YEAR ENDED 30 JUNE 2011
Record results and superior return on capital
BHP Billiton’s strategic focus on large, low cost and expandable assets once again delivered record financial performance and returns. Underlying EBITDA and Attributable profit (excluding exceptional items) increased by 51 per cent and 74 per cent respectively, while Underlying return on capital, excluding investment associated with projects not yet in production, increased to 50 per cent. The strong increase in the Group’s Underlying EBIT margin to 47 per cent emphasises the quality of BHP Billiton’s diversified portfolio.
An ongoing commitment to invest through all points of the economic cycle delivered record annual production across four commodities and ten operations. Our decision to invest in our Western Australia Iron Ore business during the depths of the global financial crisis facilitated an eleventh consecutive annual increase in iron ore production, as prices continued to test new highs. Three major projects delivered first production in the 2011 financial year including the New South Wales Energy Coal MAC20 Project (Australia), which was completed ahead of schedule.
Robust demand, industry wide cost pressures and persistent supply side constraints continued to support the fundamentals for the majority of BHP Billiton’s core commodities. In that context, another strong year of growth in Chinese crude steel production ensured steelmaking material prices were the major contributing factor to the US$17.2 billion price related increase in Underlying EBIT.
However, BHP Billiton has regularly highlighted its belief that costs tend to lag the commodity price cycle as consumable, labour and contractor costs are broadly correlated with the mining industry’s level of activity. In the current environment, tight labour and raw material markets are presenting a challenge for all operators, and BHP Billiton is not immune from that trend. The devaluation of the US dollar and inflation reduced Underlying EBIT by a further US$3.2 billion.
Record cash flow and substantial investment in tier 1 growth
Record operating cash flow of US$30.1 billion continues to create substantial flexibility for the Group. In the twelve month period alone, BHP Billiton invested US$12.4 billion across its tier 1 portfolio of minerals and energy assets, completed a US$10 billion capital management program, and finalised the acquisition of Chesapeake Energy Corporation’s interests in the Fayetteville shale (USA). Notwithstanding those achievements, net gearing of nine per cent at the end of the 2011 financial year ensures BHP Billiton has the capacity to comfortably fund its extensive organic growth program and the US$15.1 billion acquisition of Petrohawk Energy Corporation that was announced on 14 July 2011. Importantly, the Group remains committed to a solid A credit rating.
Rebasing the progressive dividend and completion of expanded capital management program
The consistent and disciplined manner in which BHP Billiton returns excess capital to shareholders was further illustrated by the completion of its expanded US$10 billion capital management program on 29 June 2011, six months ahead of schedule. Completion of the substantial program in such a timely manner highlights BHP Billiton’s commitment to maintain an appropriate capital structure, irrespective of the economic cycle. Since 2004, BHP Billiton has repurchased a cumulative US$22.6 billion of Limited (Ltd) and Plc shares, representing 15 per cent of then issued capital.
Confidence in the long term outlook for our core commodity markets and the accelerated purchase and cancellation of four per cent of issued capital during the 2011 financial year, has enabled the BHP Billiton Board to declare a 22 per cent rebasing of the final dividend. The increase in the full year payout to 101 US cents per share is consistent with the Group’s commitment to its progressive dividend policy.
2
BHP Billiton Results for the year ended 30 June 2011
Outlook
Economic outlook
Global economic growth slowed during the second half of the 2011 financial year as emerging economies tightened monetary policy, the Japanese tsunami disrupted trade flows and fiscal austerity measures adversely affected demand. Global imbalances and high levels of sovereign debt continue to create uncertainty and a protracted recovery remains our base case assumption for the developed world. However, a coordinated policy response has the potential to engender confidence and ease the volatility that has been the dominant theme of recent years.
Across the important growth economies of China and India, recent economic data suggests monetary policy is having the intended effect. That said, growth in fixed asset investment in China has remained resilient and is yet to fully reflect the recent policy response.
Despite these near term challenges, we remain positive on the longer term outlook for the global economy. Over the past decade, emerging economies have contributed more to global growth than the developed world and we expect their share to expand as the process of urbanisation and industrialisation continues.
Commodities outlook
Commodities remained an asset of choice in the 2011 financial year as strong underlying fundamentals supported prices for a number of BHP Billiton’s core products. Robust demand driven by the emerging economies, a general elevation and steepening of global (commodity) cost curves and the persistent theme of supply side constraint, were all catalysts for generally higher prices. However, we should highlight that several commodities, including metallurgical coal, iron ore, copper and crude oil, experienced supply side disruptions in the second half of the 2011 financial year that are not expected to persist beyond the short term.
We expect robust demand in the short and medium term, supported by commodities intensive emerging economic growth. A more positive demand dynamic remains a distinct possibility should policy be enacted to further stimulate growth in the developed world.
The strong pace of growth in demand for steelmaking raw materials, particularly in China, is expected to slow in the longer term, as underlying growth reverts to a more sustainable level and resource intensity per unit of GDP declines. However, the fundamentals for iron ore and metallurgical coal remain compelling as the supply response is expected to remain constrained and capital costs are expected to rise.
Over the longer term, we expect strong demand for our core commodities to be underpinned by the industrialisation and urbanisation of China, India and other emerging economies. Progressively higher cost sources of new supply will be required, supporting long run commodity prices and operating margins for the low cost producers.
Development projects
BHP Billiton approved 11 major projects for a total investment commitment of US$12.9 billion (BHP Billiton share) during the 2011 financial year. Following the progression of the Jansen Potash Project into feasibility during the March 2011 quarter, BHP Billiton also announced an additional US$488 million of pre-commitment funding to support development of the project in Saskatchewan, Canada. The progression of these projects forms a meaningful component of the Group’s anticipated organic growth program that is expected to exceed US$80 billion over the five years to the end of the 2015 financial year.
Industry wide cost pressures remain a feature of the development landscape and reflect stronger producer currencies as well as underlying inflation on raw material and labour costs. BHP Billiton approved revised capital budgets and schedules during the 2011 financial year for the Esso Australia Resources Pty Ltd operated Kipper (US$900 million, BHP Billiton share) and Turrum (US$1.4 billion, BHP Billiton share) Petroleum projects and the BHP Billiton operated Worsley Efficiency and Growth (US$3.0 billion, BHP Billiton share) alumina refinery expansion (all Australia).
3
News Release
Three major projects delivered first production in the twelve month period: namely the New South Wales Energy Coal MAC20 Project, the Douglas Middelburg Optimisation Project in South Africa Coal and Angostura Gas Phase II (Trinidad and Tobago).
Projects completed during the 2011 financial year
Customer Project Capacity(i) Capital expenditure Date of initial
Sector (US$M)(i) production(ii)
Group
Budget Actual Target Actual
Petroleum Angostura Gas Phase II 280 million cubic feet of 180 157 (iii) H1 2011 H1 2011
(Trinidad and Tobago) gas per day.
BHP Billiton – 45%
Energy Coal Douglas Middelburg 10 million tonnes per 975 760(iii) Mid 2010 July 2010
Optimisation annum export thermal
(South Africa) coal and 8.5 million
BHP Billiton – 100% tonnes per annum
domestic thermal coal
(sustains current output).
MAC20 Project (Australia) Increases saleable 260 285 (iii) H1 2011 H1 2011
BHP Billiton – 100% thermal coal production
by approximately 3.5
million tonnes per annum.
1,415 1,202
(i) All references to capital expenditure are BHP Billiton’s share unless noted otherwise. All references to capacity are 100 per cent unless noted otherwise.
(ii) References are based on calendar years.
(iii) Number subject to finalisation.
Projects currently under development (approved in prior years)
Customer Project Capacity(i) Budgeted Target date
Sector capital for initial
Group expenditure production(ii)
(US$M)(i)
Petroleum Bass Strait Kipper 10,000 barrels of condensate per day 900(iii) 2012(iii)(iv)
(Australia) and processing capacity of 80 million
BHP Billiton – 32.5% – 50% cubic feet of gas per day.
Bass Strait Turrum 11,000 barrels of condensate per day 1,350(iii) 2013(iii)
(Australia) and processing capacity of 200 million
BHP Billiton – 50% cubic feet of gas per day.
North West Shelf CWLH Replacement vessel with capacity of 245 2011
Life Extension (Australia) 60,000 barrels of oil per day.
BHP Billiton – 16.67%
North West Shelf 2,500 million cubic feet of gas per day. 850 2013
North Rankin B Gas
Compression (Australia)
BHP Billiton – 16.67%
Aluminium Worsley Efficiency and 1.1 million tonnes per annum of 2,995(iii) Q1 2012(iii)
Growth (Australia) additional alumina capacity.
BHP Billiton – 86%
Base Metals Antamina Expansion (Peru) Increases ore processing capacity to 435 Q4 2011
BHP Billiton – 33.75% 130,000 tonnes per day.
Iron Ore WAIO Rapid Growth Project Project integrated into subsequent 4,800 H2 2011
5 (Australia) expansion approvals that will increase
BHP Billiton – 85% WAIO capacity to 220 million tonnes per annum(v).
11,575
(i) All references to capital expenditure are BHP Billiton’s share unless noted otherwise. All references to capacity are 100 per cent unless noted otherwise.
(ii) References are based on calendar years.
(iii) As per revised budget and schedule.
(iv) Facilities ready for first production pending resolution of mercury content.
(v) Consistent with the revised scope of the iron ore development sequence.
4
BHP Billiton Results for the year ended 30 June 2011
Projects approved during the 2011 financial year
Customer Project Capacity(i) Budgeted Target date
Sector Group capital for initial
expenditure production(ii)
(US$M)(i)
Petroleum Macedon (Australia) 200 million cubic feet of gas per day. 1,050 2013
BHP Billiton – 71.43%
Base Metals Escondida Ore Access The relocation of the in-pit crushing 319 Q2 2012
(Chile) and conveyor infrastructure provides
BHP Billiton – 57.5% access to higher grade ore.
Diamonds & EKATI Misery Open Pit Project consists of a pushback of the 323 2015
Specialty Project (Canada) existing Misery open pit which was
Products BHP Billiton – 80% mined from 2001 to 2005.
Iron Ore WAIO Jimblebar Mine Increases mining and processing 3,300(iii) Q1 2014
Expansion (Australia) capacity to 35 million tonnes per
BHP Billiton – 96% annum.
WAIO Port Hedland Inner Increases total inner harbour capacity 1,900(iii) H2 2012
Harbour Expansion to 220 million tonnes per annum with
(Australia) debottlenecking opportunities to 240
BHP Billiton – 85% million tonnes per annum.
WAIO Port Blending and Optimises resource and enhances 1,400(iii) H2 2014
Rail Yard Facilities efficiency across the WAIO supply (Australia) chain.
BHP Billiton – 85%
Samarco Fourth Pellet Plant Increases iron ore pellet production 1,750 H1 2014
(Brazil) capacity by 8.3 million tonnes per
BHP Billiton – 50% annum to 30.5 million tonnes per annum.
Metallurgical Daunia (Australia) Greenfield mine development with 800 2013
Coal BHP Billiton – 50% capacity to produce 4.5 million tonnes per annum of export metallurgical coal.
Broadmeadow Life Increases productive capacity by 0.4 450 2013
Extension (Australia) million tonnes per annum and extends
BHP Billiton – 50% the life of the mine by 21 years.
Hay Point Stage Three Increases port capacity from 44 million 1,250(iii) 2014
Expansion (Australia) tonnes per annum to 55 million tonnes
BHP Billiton – 50% per annum and reduces storm vulnerability.
Energy Coal RX1 Project (Australia) Increases run-of-mine thermal coal 400 H2 2013
BHP Billiton – 100% production by approximately 4 million tonnes per annum.
12,942
(i) All references to capital expenditure are BHP Billiton’s share unless noted otherwise. All references to capacity are 100 per cent unless noted otherwise.
(ii) References are based on calendar years.
(iii) Excludes announced pre-commitment funding.
Income statement
To provide clarity into the underlying performance of our operations we present Underlying EBIT, which is a measure used internally and in our Supplementary Information, that excludes any exceptional items. The difference between Underlying EBIT and Profit from operations is set out in the following table:
Year ended 30 June 2011 2010
US$M US$M
Underlying EBIT 31,980 19,719
Exceptional items (before taxation) (164) 312
Profit from operations 31,816 20,031
Refer to page 9 for details of the exceptional items.
5
News Release
Underlying EBIT
The following table and commentary describes the approximate impact of the principal factors that affected Underlying EBIT for the 2011 financial year compared with the 2010 financial year:
US$M US$M
Underlying EBIT for the year ended 30 June 2010 19,719
Change in volumes:
Increase in volumes 841
Decrease in volumes(1,422)
(581)
Net price impact:
Change in sales prices 18,648
Price linked costs(1,420)
17,228
Change in costs:
Costs (rate and usage)(1,412)
Exchange rates(2,526)
Inflation on costs(635)
(4,573)
Asset sales(85)
Ceased and sold operations(140)
New and acquired operations 1,153
Exploration and business development(328)
Other(413)
Underlying EBIT for the year ended 30 June 2011 31,980
Volumes
BHP Billiton achieved production records across four commodities and ten operations during the 2011 financial year. Western Australia Iron Ore shipments rose to a record annualised rate of 155 million tonnes per annum (mtpa) in the June 2011 quarter and, when combined with strong operating performance at Samarco (Brazil), enabled iron ore volumes to contribute an additional US$572 million to Underlying EBIT.
The completion and successful ramp up of the MAC20 Project ahead of schedule underpinned record production at New South Wales Energy Coal in the period. When considered in conjunction with a 13 per cent increase in South Africa Coal production, Energy Coal volumes increased Underlying EBIT by US$177 million in the 2011 financial year.
However, broader challenges continued to delay the supply response of the industry over the twelve month period. For example, metallurgical coal supply was significantly affected by persistent wet weather in the Bowen Basin (Australia) while ongoing permitting delays in the Gulf of Mexico (USA) continued to impact drilling activity. In aggregate, volumes reduced BHP Billiton Underlying EBIT by US$581 million in the 2011 financial year despite generally strong operating performance.
Prices
Robust demand driven by the emerging economies, a general elevation and steepening of global (commodity) cost curves and the persistent theme of supply side constraint, were all catalysts for higher commodity prices that increased Underlying EBIT by US$18.6 billion in the period. Another strong year of growth in Chinese crude steel production ensured steelmaking material prices were the major contributing factor, as they alone increased Underlying EBIT by US$11.1 billion. Price linked costs (including royalties) reduced Underlying EBIT by US$1.4 billion.
6
BHP Billiton Results for the year ended 30 June 2011
Costs
BHP Billiton has regularly highlighted its belief that costs tend to lag the commodity price cycle as consumable, labour and contractor costs are broadly correlated with the mining industry’s level of activity. In the current environment of elevated commodity prices, tight labour and raw material markets are presenting a challenge for all operators. Excluding the impact of a weaker US dollar, inflation and an increase in non-cash items, costs decreased Underlying EBIT by US$1.2 billion.
Higher fuel and energy prices (of which BHP Billiton is a net beneficiary), together with increased maintenance, labour and contractor costs, accounted for the majority of the impact and reduced Underlying EBIT by US$878 million.
Cost performance in the large, bulk commodity businesses is heavily influenced by the ability to leverage infrastructure and maximise volumes. In this regard, the weather related disruption at our Queensland Coal (Australia) business had a negative impact on unit costs in the period. The major cost offset was related to the recovery in operating performance that followed last year’s Clark Shaft outage at Olympic Dam (Australia).
Non-cash items, predominantly depreciation, reduced Underlying EBIT by a further US$255 million and reflected the ongoing delivery of our organic growth program.
Exchange rates
A weaker US dollar against producer currencies reduced Underlying EBIT by US$2.5 billion, which included a US$735 million variance related to the restatement of monetary items in the balance sheet. The Australian operations were the most heavily impacted. The strong Australian dollar reduced Underlying EBIT by US$2.1 billion, which included a US$640 million variance related to the restatement of monetary items in the balance sheet. The absolute impact on costs as a result of the restatement of monetary items in the balance sheet was a loss of US$807 million in the 2011 financial year.
The following exchange rates against the US dollar have been applied:
Average Average
Year ended Year ended As at As at As at
30 June 30 June 30 June 30 June 30 June
2011 2010 2011 2010 2009
Australian dollar(i) 0.99 0.88 1.07 0.85 0.81
Chilean peso 486 529 470 545 530
Colombian peso 1,843 1,970 1,779 1,920 2,159
Brazilian real 1.68 1.80 1.57 1.81 1.95
South African rand 7.01 7.59 6.80 7.68 7.82
(i) Displayed as US$ to A$1 based on common convention.
Inflation on costs
Inflationary pressure on costs across all businesses had an unfavourable impact on Underlying EBIT of US$635 million. The pressure was most evident in Australia and South Africa, which accounted for over two thirds of the total impact.
Asset sales
The profit on the sale of assets was US$85 million lower than the corresponding period largely due to the dissolution of the Douglas Tavistock Joint Venture (South Africa), which increased Underlying EBIT in the prior period.
Ceased and sold operations
The currency revaluation of rehabilitation and closure provisions for ceased operations was the major driver of the US$140 million reduction in Underlying EBIT.
7
News Release
New and acquired operations
Assets are reported as new and acquired operations until there is a full year comparison. New operations increased Underlying EBIT by US$1.2 billion primarily due to strong performance at the BHP Billiton operated Pyrenees oil facility (Australia) and the inaugural contribution from the recently acquired Fayetteville shale assets.
Exploration and business development
Group exploration expense increased marginally in the 2011 financial year to US$1.1 billion. Within Minerals (US$577 million expense) the focus centred upon copper targets in South America, Mongolia and Zambia; nickel and copper targets in Australia; and diamond targets in Canada. Exploration for iron ore, potash, uranium and manganese was undertaken in a number of regions including Australia, Asia, Africa and the Americas.
Petroleum exploration expense was US$477 million and included a US$73 million impairment of exploration previously capitalised. Exploration drilling activity was delayed in the Gulf of Mexico due to new regulatory permitting processes but was partially offset by an increase in the acquisition and processing of geophysical data. BHP Billiton’s proven operating capability in the deepwater remains an important competitive advantage and the Group will continue to invest in an extensive exploration program that is focused on the Gulf of Mexico, South China Sea and Australia.
Expenditure on business development reduced Underlying EBIT by an additional US$303 million compared with the prior period as Base Metals progressed a number of its development options, including the Olympic Dam Project (ODP1) and the Spence Hypogene project (Chile). Increased activity on the Scarborough and Browse liquefied natural gas projects (both Australia) in the 2011 financial year also contributed to the rise in the business development expense.
Other
Other items decreased Underlying EBIT by US$413 million and included provisions totalling US$189 million related to indirect taxes in the Aluminium and Iron Ore businesses, and the Colombian net worth tax in Stainless Steel Materials and Energy Coal.
Net finance costs
Net finance costs increased to US$561 million from US$459 million in the corresponding period. This was primarily driven by exchange rate variations on net debt and lower amounts of interest capitalised.
Taxation expense
Excluding the impacts of royalty related taxation, exceptional items and exchange rate movements, taxation expense was US$10.1 billion representing an underlying effective tax rate of 32.1 per cent (2010: 30.9 per cent; 2009: 31.4 per cent).
Government imposed royalty arrangements calculated by reference to profits after adjustment for temporary differences are reported as royalty related taxation. Royalty related taxation contributed US$828 million to taxation expense representing an effective rate of 2.6 per cent (2010: US$451 million and 2.3 per cent; 2009: US$495 million and 4.3 per cent).
Other royalty and excise arrangements which do not have these characteristics are recognised as operating costs within profit before taxation. These amounted to US$2.9 billion during the period (2010: US$1.7 billion; 2009: US$1.9 billion).
Exceptional items decreased taxation expense by US$2.1 billion (2010: increase of US$59 million; 2009: decrease of US$1.2 billion) predominantly due to the reversal of deferred tax liabilities of US$1.5 billion following the election of eligible Australian entities to adopt a US dollar tax functional currency, as well as the release of tax provisions of US$718 million following the Group’s position being confirmed with respect to ATO amended assessments.
8
BHP Billiton Results for the year ended 30 June 2011
Exchange rate movements decreased taxation expense by US$1.5 billion (2010: increase of US$106 million; 2009: increase of US$444 million) predominantly due to the revaluation of local currency deferred tax assets arising from future tax depreciation of US$2.5 billion, partly offset by the revaluation of local currency tax liabilities and deferred tax balances arising from other monetary items and temporary differences which amounted to US$1.0 billion.
Total taxation expense including royalty related taxation and the predominantly non-cash exceptional items and exchange rate movements described above, was US$7.3 billion, representing an effective rate of 23.4 per cent (2010: 33.5 per cent; 2009: 45.4 per cent).
Exceptional items
The Group withdrew its offer for Potash Corporation of Saskatchewan (PotashCorp) on 15 November 2010 following the Board’s conclusion that the condition of the offer relating to receipt of a net benefit as determined by the Minister of Industry under the Investment Canada Act could not be satisfied. The Group incurred fees associated with the US$45 billion debt facility (US$240 million), investment bankers’, lawyers’ and accountants’ fees, printing expenses and other charges (US$74 million) in progressing this matter during the period up to the withdrawal of the offer, which were expensed as operating costs in the 2011 financial year.
The Group recognised a decrease of US$150 million (US$45 million tax charge) to rehabilitation obligations in respect of former operations at the Newcastle steelworks (Australia) following a full review of the progress of the Hunter River Remediation Project (Australia) and estimated costs to completion.
The Australian Taxation Office (ATO) issued amended assessments in prior years denying bad debt deductions arising from the investments in Beenup and Boodarie Iron and the denial of capital allowance claims made on the Boodarie Iron project. The Group challenged the assessments and was successful on all counts before the Full Federal Court. The ATO obtained special leave in September 2010 to appeal to the High Court in respect of the denial of capital allowance claims made on the Boodarie Iron project. The Group’s position in respect of the capital allowance claims on the Boodarie Iron project was confirmed by the High Court in June 2011. As a result of these appeals, US$138 million was released from the Group’s income tax provision in September 2010 and US$580 million in June 2011.
Consistent with the functional currency of the Group’s operations, eligible Australian entities elected to adopt a US dollar tax functional currency from 1 July 2011. As a result, the deferred tax liability relating to certain US dollar denominated financial arrangements has been derecognised, resulting in a credit to income tax expense of US$1.5 billion.
Year ended 30 June 2011 Gross US$M Tax US$M Net US$M
Exceptional items by category
Withdrawn offer for PotashCorp (314) – (314)
Newcastle steelworks rehabilitation 150 (45) 105
Release of income tax provisions – 718 718
Reversal of deferred tax liabilities – 1,455 1,455
(164) 2,128 1,964
Cash flows
Net operating cash flows after interest and tax increased by 78 per cent to US$30.1 billion. This was primarily driven by an increase in cash generated from operations (before changes in working capital balances) of US$12.3 billion and changes in working capital balances having a positive year on year impact on operating cash flow of US$2.6 billion.
In accordance with IFRS, exploration expenditure incurred which has not been capitalised is now classified within net operating cash flows, which has resulted in the classification of US$981 million in net operating cash flows for the 2011 financial year and US$1.0 billion for the 2010 financial year.
9
News Release
Capital and exploration expenditure totalled US$12.4 billion for the year. Expenditure on major growth projects was US$9.2 billion, including US$1.8 billion on Petroleum projects and US$7.4 billion on Minerals projects. Capital expenditure on sustaining and other items was US$2.0 billion. Exploration expenditure was US$1.2 billion, including US$981 million classified within net operating cash flows.
Financing cash flows include payments related to the US$10 billion capital management program, dividend payments of US$5.1 billion and net debt repayments of US$577 million.
Net debt, comprising interest bearing liabilities less cash, was US$5.8 billion which is an increase of US$2.5 billion compared to the net debt position at 30 June 2010.
Dividend
BHP Billiton has a commitment to its progressive dividend policy, irrespective of the economic climate and the Group’s growth aspirations. In that context, our Board today declared a final dividend of 55 US cents per share, which represents a 22 per cent increase on last year’s equivalent payout. Together with the interim dividend of 46 US cents per share paid to shareholders on 31 March 2011, this brings the total dividend for the year to 101 US cents per share.
The dividend to be paid by BHP Billiton Ltd will be fully franked for Australian taxation purposes. Dividends for the BHP Billiton Group are determined and declared in US dollars. However, BHP Billiton Ltd dividends are mainly paid in Australian dollars, and BHP Billiton Plc dividends are mainly paid in pounds sterling and South African rand to shareholders on the UK section and the South African section of the register, respectively. Currency conversions will be based on the foreign currency exchange rates on the Record Date, except for the conversion into South African rand, which will take place on the last day to trade on JSE Limited, being 2 September 2011. Please note that all currency conversion elections must be registered by the Record Date, being 9 September 2011. Any currency conversion elections made after this date will not apply to this dividend.
The timetable in respect of this dividend will be:
Last day to trade cum dividend on JSE Limited and currency conversion into rand 2 September 2011
Ex-dividend Australian Securities Exchange (ASX) and JSE Limited (JSE) 5 September 2011
Ex-dividend London Stock Exchange (LSE) and New York Stock Exchange (NYSE) 7 September 2011
Record Date (including currency conversion and currency election dates, except for rand) 9 September 2011
Payment date 29 September 2011
American Depositary Shares (ADSs) each represent two fully paid ordinary shares and receive dividends accordingly.
BHP Billiton Plc shareholders registered on the South African section of the register will not be able to dematerialise or rematerialise their shareholdings between the dates of 5 and 9 September 2011, nor will transfers between the UK register and the South African register be permitted between the dates of 2 and 9 September 2011.
Details of the currency exchange rates applicable for the dividend will be announced to the relevant stock exchanges following conversion and will appear on the Group’s website.
Capital management
Notwithstanding BHP Billiton’s commitment to invest more than US$80 billion in the growth of its tier 1 portfolio, the Group reactivated the remaining US$4.2 billion component of a previously suspended US$13 billion buy-back program on 15 November 2010. BHP Billiton subsequently expanded that capital management initiative to US$10 billion and committed to complete the program by the end of the 2011 calendar year.
The subsequent completion of a US$6.3 billion off-market tender buy-back of BHP Billiton Ltd shares during the period enabled the Group to successfully complete its US$10 billion capital management program on 29 June 2011, six months ahead of schedule.
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BHP Billiton Results for the year ended 30 June 2011
During the 2011 financial year, the combination of on-market purchases of Plc shares and the off-market purchase of Ltd shares enabled BHP Billiton to buy (and cancel) 241.8 million shares, representing four per cent of total issued capital.
Completion of this substantial program in such a timely manner highlighted BHP Billiton’s commitment to maintain an appropriate capital structure through all points of the economic cycle. Since 2004, BHP Billiton has repurchased a cumulative US$22.6 billion of Ltd and Plc shares, representing 15 per cent of then issued capital. Total returns to shareholders, including dividends paid and share buy-backs, have exceeded US$48 billion since the formation of BHP Billiton in 2001.
Debt management and liquidity
No long term debt securities were issued in the debt capital markets by the Group during the 2011 financial year. The Group has access to an undrawn US$4 billion Revolving Credit Facility, which expires in December 2015. We have maintained a strong liquidity position and at 30 June 2011, had US$10.1 billion of cash on hand. Surplus cash will be absorbed by the US$15.1 billion Petrohawk acquisition and our net gearing position will increase accordingly. Our commitment to retain a solid A credit rating remains unchanged.
Corporate governance
On 13 December 2010, the Board announced the appointment of Baroness Shriti Vadera as a Non-executive Director with effect from 1 January 2011.
On 23 March 2011, the Board announced the resignation of Mr Alan Boeckmann as a Non-executive Director and the appointment of Mr Lindsay Maxsted as a Non-executive Director, both with effect from that date.
CUSTOMER SECTOR GROUP SUMMARY
The following table provides a summary of the performance of the Customer Sector Groups for the 2011 financial year and the corresponding period.
Year ended 30 June Revenue Underlying EBIT(i)
(US$M) 2011 2010 Change % 2011 2010 Change %
Petroleum 10,737 8,782 22.3% 6,330 4,573 38.4%
Aluminium 5,221 4,353 19.9% 266 406 (34.5%)
Base Metals 14,152 10,409 36.0% 6,790 4,632 46.6%
Diamonds and Specialty Products 1,517 1,272 19.3% 587 485 21.0%
Stainless Steel Materials 3,861 3,617 6.7% 588 668 (12.0%)
Iron Ore 20,412 11,139 83.2% 13,328 6,001 122.1%
Manganese 2,423 2,150 12.7% 697 712 (2.1%)
Metallurgical Coal 7,573 6,059 25.0% 2,670 2,053 30.1%
Energy Coal 5,507 4,265 29.1% 1,129 730 54.7%
Group and unallocated items(ii) 385 802 N/A (405) (541) N/A
Less: inter-segment revenue (49) (50) N/A – – N/A
BHP Billiton Group 71,739 52,798 35.9% 31,980 19,719 62.2%
(i) Underlying EBIT includes trading activities comprising the sale of third party product. Underlying EBIT for the Group is reconciled to Profit from operations on page 5.
(ii) Includes consolidation adjustments, unallocated items and external sales from the Group’s freight, transport and logistics operations.
Petroleum
The successful integration of the Fayetteville shale gas assets, the start-up of the Angostura Gas Phase II project on schedule, and strong underlying performance from existing assets, delivered 159.4 million barrels of oil equivalent for the 2011 financial year, the fourth consecutive increase in annual petroleum production. BHP Billiton brought the first new deepwater well into production since the Gulf of Mexico moratorium was enacted in May 2010 and this important milestone, achieved at the BHP Billiton operated Shenzi field (USA), followed previous regulatory approvals for water injection and production well drilling.
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Underlying EBIT of US$6.3 billion represented an increase of US$1.8 billion or 38 per cent when compared with the prior period. Higher average realised prices were a major contributor to the increase in Underlying EBIT (US$1.5 billion, net of price linked costs) and reflected a 28 per cent increase in oil prices to US$93.29 per barrel, a 22 per cent increase in realised liquefied natural gas prices to US$11.03 per thousand standard cubic feet, and a 17 per cent increase in natural gas prices to US$4.00 per thousand standard cubic feet. BHP Billiton’s operating capability was further underscored by the success of Pyrenees although natural field decline worldwide was further impacted by the deferral of high volume wells in the Gulf of Mexico. Gross exploration spend of US$557 million was similarly impacted, although an increase in seismic acquisition and processing partially offset the decrease in drilling activity. Recommencement of development drilling at Atlantis (USA) is still pending although a step out exploration well at Mad Dog (USA) is currently underway.
From a longer term perspective, the growth potential of the Petroleum business has been significantly enhanced by the acquisition of onshore US shale gas resources while organic growth projects, such as the Macedon gas project (Australia), continue to move through the execution phase.
Aluminium
The ongoing ramp up of the Alumar refinery (Brazil) contributed to a seven per cent increase in total alumina production for the 2011 financial year. Metal production remained largely unchanged with all operations running at or close to technical capacity.
Underlying EBIT was US$266 million, a decrease of US$140 million or 34 per cent when compared with the corresponding period. Higher prices and premia for aluminium had a favourable impact of US$559 million (net of price linked costs) but were offset by a US$519 million increase in costs largely associated with the devaluation of the US dollar, inflation and rising raw material and energy costs. The average realised aluminium price increased by 19 per cent to US$2,515 per tonne while the average realised alumina price rose 21 per cent to US$342 per tonne. Underlying EBIT was unfavourably impacted by a provision related to indirect taxes in the 2011 financial year.
The US$3.0 billion (BHP Billiton share) Worsley Efficiency and Growth project will confirm Worsley as one of the world’s leading alumina refineries. The investment will raise capacity at the refinery by 1.1 mtpa to 4.6 mtpa (100 per cent basis) and first production is now scheduled for the first quarter of calendar year 2012.
Base Metals
Copper production increased during the 2011 financial year as Olympic Dam reported annual material mined and milling records. Strong operating performance was similarly reported at Pampa Norte (Chile) and Antamina (Peru), where record annual milling rates mitigated the impact of lower grades. Total copper cathode production represented another record for the period.
Underlying EBIT for the 2011 financial year increased by US$2.2 billion or 47 per cent, to US$6.8 billion. Higher average realised prices for all of our core products favourably impacted Underlying EBIT by US$3.3 billion (net of price linked costs). The supportive pricing environment was similarly reflected in a number of our key input costs with higher energy, fuel and contractor costs the major offset. The devaluation of the US dollar and inflation reduced Underlying EBIT by US$418 million. In addition, BHP Billiton refined the basis on which the metal content of its leach pads is estimated at Escondida (Chile) and Pampa Norte, which resulted in a non-cash reduction in Underlying EBIT of US$168 million.
At 30 June 2011, the Group had 239,156 tonnes of outstanding copper sales that were revalued at a weighted average price of US$4.25 per pound. The final price of these sales will be determined in the 2012 financial year. In addition, 236,584 tonnes of copper sales from the 2010 financial year were subject to a finalisation adjustment in 2011. The finalisation adjustment and provisional pricing impact increased Underlying EBIT by US$650 million for the period.
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BHP Billiton Results for the year ended 30 June 2011
BHP Billiton’s Base Metals business is characterised by its large, tier 1 resource position and its numerous options for growth. In that context, a combined investment of US$492 million (BHP Billiton share) was approved during the period for the Escondida Ore Access and Laguna Seca Debottlenecking projects (Chile). The quality of the Base Metals investment pipeline was further emphasised by the progression of both the Escondida Organic Growth Project (OGP1) and the Olympic Dam Project (ODP1) development options into feasibility. A 129 per cent increase in the Escondida district Mineral Resource tonnage(7) solidifies Escondida’s position as the world’s leading copper operation for decades to come.
Diamonds and Specialty Products
EKATI (Canada) diamond production for the 2011 financial year was 2.5 million carats, an 18 per cent decrease from the prior period. BHP Billiton expects lower average ore grades to impact EKATI production in the medium term, consistent with the mine plan.
Underlying EBIT for the Diamonds and Specialty Products business increased by 21 per cent to US$587 million. Strong demand and a shortage of rough diamonds resulted in higher prices, which increased Underlying EBIT by US$254 million. A 28 per cent increase in titanium prices added a further US$112 million to Underlying EBIT. Gross exploration expenditure was US$81 million, a decrease of US$14 million from the prior period. BHP Billiton continues to accelerate its potash exploration program in Saskatchewan, with a significant increase in activity planned at the Melville prospect in the 2012 financial year.
BHP Billiton’s goal of becoming a significant producer in the potash market took another important step forward in the 2011 financial year. The approval of a further US$488 million of pre-commitment funding during the Jansen Potash Project feasibility study phase will fund site preparation, the procurement of long lead time items and the sinking of the first 350 metres of the production and service shafts.
Stainless Steel Materials
The Nickel West Kalgoorlie smelter (Australia) achieved record matte production during the 2011 financial year while Cerro Matoso (Colombia) successfully progressed its planned furnace replacement into the commissioning phase.
Underlying EBIT decreased by US$80 million or 12 per cent, to US$588 million for the 2011 financial year as a weaker US dollar impacted both operating costs and year end balance sheet revaluations. In total, the weaker US dollar and inflation reduced Underlying EBIT by US$227 million. The planned loss of production at Cerro Matoso and the absence of stockpiled concentrate sales at Nickel West that benefited the 2010 financial year decreased Underlying EBIT by a combined US$122 million. Underlying EBIT at Cerro Matoso was impacted by a further US$53 million due to a provision related to the Colombian net worth tax and additional royalty charges. In contrast, a 24 per cent rise in the LME nickel price for the period increased Underlying EBIT by approximately US$435 million (net of price linked costs).
During the second half of the financial year, the Cerro Matoso Heap Leach project progressed into feasibility. The Nickel West Talc re-design project remains on schedule for expected commissioning in the 2012 financial year.
Iron Ore
BHP Billiton’s commitment to invest through all phases of the economic cycle delivered an eleventh consecutive annual production record in iron ore. Western Australia Iron Ore (WAIO) benefited from the dual tracking of the company’s rail infrastructure, which has substantially increased overall system capability. WAIO shipments rose to a record annualised rate of 155 mtpa (100 per cent basis) in the June 2011 quarter, confirming the successful ramp up of recently expanded capacity.
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Underlying EBIT increased by 122 per cent to US$13.3 billion for the 2011 financial year driven by record production and a significant improvement in iron ore prices. For the period, average realised iron ore prices increased Underlying EBIT by US$8.5 billion following the important transition to shorter term, landed, market based pricing. The significant appreciation in product prices and the adjustment of WAIO royalty rates contributed to a significant increase in price linked costs, which reduced Underlying EBIT by US$648 million. Broader inflationary pressures and the devaluation of the US dollar reduced Underlying EBIT by a further US$813 million while non-cash depreciation also increased with the ramp up of expanded iron ore capacity.
The investment approval for major projects totalling US$8.4 billion(8) (BHP Billiton share) in the 2011 financial year highlighted the company’s commitment to accelerate the development of its tier 1, low cost and expandable iron ore operations. BHP Billiton also continued to lay the foundations for longer term growth in the WAIO business with the release of its Public Environmental Review/Draft Environmental Impact Statement that seeks Commonwealth and Western Australian Government approvals for the proposed development of an Outer Harbour facility in Port Hedland (Australia).
Manganese
Record annual ore production and sales reflected a full year contribution from the GEMCO Expansion Phase 1 (GEEP1) project (Australia). Record annual sales were also achieved for manganese alloy as the business intensified its volume maximising strategy.
Underlying EBIT remained largely unchanged at US$697 million as stronger volumes and prices were offset by higher costs. Notably, controllable costs remained largely unchanged during the period, although the combined impact of a weaker US dollar and inflation reduced Underlying EBIT by US$186 million. Average realised ore and alloy prices increased by 9 per cent and 7 per cent respectively during the 2011 financial year.
After the successful commissioning of the GEEP1 project, the partners have approved the next phase of expansion that will confirm GEMCO’s status as the world’s largest and lowest cost producer of manganese ore. The US$167 million (BHP Billiton share) GEEP2 project will increase GEMCO’s beneficiated product capacity from 4.2 mtpa to 4.8 mtpa (100 per cent basis). In addition, road and port capacity will increase to 5.9 mtpa, creating 1.1 mtpa of latent capacity for future expansion.
Metallurgical Coal
The remnant effects of wet weather that persisted for much of the 2011 financial year continued to restrict our Queensland Coal business, despite an unrelenting focus on recovery efforts. Although Queensland Coal production did recover strongly in the June 2011 quarter, total metallurgical coal production declined by 13 per cent in the 2011 financial year.
Underlying EBIT was US$2.7 billion, an increase of US$617 million or 30 per cent from the corresponding period. The increase was mainly attributable to the 48 per cent and 45 per cent improvement in average realised prices for hard coking coal and weak coking coal, respectively. In total, stronger prices increased Underlying EBIT by US$2.1 billion, net of price linked costs. Uncontrollable factors were the major contributor to a significant increase in operating costs. In that context, inflation and the weaker US dollar reduced Underlying EBIT by US$664 million, while the weather related disruption to production at Queensland Coal placed additional pressure on unit costs. We continue to expect production, sales and unit costs to be impacted, to some extent, for the remainder of the 2011 calendar year.
In March 2011, BHP Billiton approved three major metallurgical coal projects located in the Bowen Basin. The projects are expected to add 4.9 million tonnes of annual capacity (100 per cent basis) through development of the Daunia operation and a new mining area at Broadmeadow (both Australia). In addition, 11 million tonnes of valuable port capacity (100 per cent basis) will be developed at the Hay Point Coal Terminal (Australia). The cumulative US$2.5 billion(8) (BHP Billiton share) investment establishes the platform for strong and sustainable metallurgical coal production growth that will be required to meet the growing needs of our customers.
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BHP Billiton Results for the year ended 30 June 2011
Energy Coal
Annual production and sales records for New South Wales Energy Coal followed the successful commissioning and ramp up of the MAC20 Project, while strong performance at South Africa Coal delivered a 13 per cent increase in annual production.
Underlying EBIT increased by 55 per cent to US$1.1 billion in the 2011 financial year. The 31 per cent rise in average realised prices, which increased Underlying EBIT by US$917 million for the period, reflected a higher proportion of export sales as BHP Billiton continued to optimise its product mix in response to evolving market demand. Broad cost pressures were accentuated by an increase in cash and non-cash costs associated with the ramp up of growth projects in Australia and South Africa. The weaker US dollar and inflation reduced Underlying EBIT by US$298 million, while a non recurring charge related to the recognition of the Colombian net worth tax reduced Underlying EBIT by a further US$32 million. The dissolution of the Douglas Tavistock Joint Venture arrangement increased Underlying EBIT in the corresponding period by US$69 million.
The MAC20 Project was successfully completed during the 2011 financial year, ahead of schedule. The company’s confidence in the outlook for demand in the Asia Pacific Basin was subsequently illustrated by the approval of the US$400 million RX1 Project (Australia) that is designed to get product to market rapidly, ahead of further coal preparation plant expansions. Further expansion of our world class Cerrejon Coal operation (Colombia) to 40 mtpa (100 per cent basis) was approved by the partners in August 2011 and highlights the strong growth outlook for BHP Billiton’s Energy Coal business.
Group and Unallocated items
The Underlying EBIT expense for Group and Unallocated decreased by US$136 million in the 2011 financial year, to US$405 million. The weaker US dollar and inflation had an unfavourable impact on Underlying EBIT of US$105 million. Self insurance claims related to the Clark Shaft incident at Olympic Dam reduced Underlying EBIT in the prior period by US$297 million.
The following notes explain the terms used throughout this profit release:
(1) Underlying EBIT is earnings before net finance costs and taxation and any exceptional items. Underlying EBITDA is Underlying EBIT before depreciation, impairments and amortisation of US$5,113 million for the year ended 30 June 2011 and US$4,794 million for the year ended 30 June 2010 (excluding exceptional items of US$319 million). We believe that Underlying EBIT and Underlying EBITDA provide useful information, but should not be considered as an indication of, or alternative to, Attributable profit as an indicator of operating performance or as an alternative to cash flow as a measure of liquidity.
(2) Underlying EBIT is used to reflect the underlying performance of BHP Billiton’s operations. Underlying EBIT is reconciled to Profit from operations on page 5.
(3) Underlying EBIT margin excludes the impact of third party product activities.
(4) Net operating cash flows are after net interest and taxation.
(5) Represents total enterprise value of approximately US$15.1 billion.
(6) Net interest includes interest capitalised and excludes the effect of discounting on provisions and other liabilities, discounting on post-retirement employee benefits, fair value change on hedged loans, fair value change on hedging derivatives, exchange variations on net debt and expected return on pension scheme assets.
(7) This BHP Billiton Mineral Resource information was sourced from and should be read together with and subject to the notes set out in the June 2011 Exploration and Development Report. This document can be viewed at www.bhpbilliton.com. The Mineral Resource information is compiled by Richard Preece (FAusIMM) who is a full time employee of BHP Billiton and who has the required qualifications and experience to qualify as a Competent Person under the JORC Code and consents to the form and context in which it appears above. Mineral Resources are stated on a 100% basis. The detailed breakdown of Mineral Resources is 3.1bt @0.75%Cu Measured, 4.7bt @0.59%Cu Indicated, 11.7bt @0.49%Cu Inferred.
(8) Excludes announced pre-commitment funding.
(9) Unless otherwise stated, production volumes exclude suspended and sold operations.
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News Release
Cautionary Statement Regarding Forward-Looking Statements
This communication may contain, in addition to historical information, certain forward-looking statements regarding future events, conditions, circumstances or the future financial performance of BHP Billiton Plc and BHP Billiton Limited and their affiliates, including North America Holdings II Inc. and BHP Billiton Petroleum (North America) Inc. (collectively, the “BHP Billiton Group”), Petrohawk Energy Corporation (“Petrohawk”) or the enlarged BHP Billiton Group following completion of the tender offer, the merger and other related transactions in respect of Petrohawk (the “Transactions”). Often, but not always, forward-looking statements can be identified by the use of words such as “plans,” “expects,” “expected,” “scheduled,” “estimates,” “intends,” “anticipates” or “believes,” or variations of such words and phrases or state that certain actions, events, conditions, circumstances or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. Such forward-looking statements are not guarantees or predictions of future performance, and are subject to known and unknown risks, uncertainties and other factors, many of which are beyond our control, that could cause actual results, performance or achievements of any member of the BHP Billiton Group or the enlarged BHP Billiton Group following completion of the Transactions to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties include: (i) the risk that not all conditions of the merger will be satisfied or waived, (ii) beliefs and assumptions relating to available borrowing capacity and capital resources generally, (iii) expectations regarding environmental matters, including costs of compliance and the impact of potential regulations or changes to current regulations to which Petrohawk or any member of the BHP Billiton Group is or could become subject, (iv) beliefs about oil and gas reserves, (v) anticipated liquidity in the markets in which BHP Billiton or any member of the BHP Billiton Group transacts, including the extent to which such liquidity could be affected by poor economic and financial market conditions or new regulations and any resulting impacts on financial institutions and other current and potential counterparties, (vi) beliefs and assumptions about market competition and the behaviour of other participants in the oil and gas exploration, development or production industries, (vii) the effectiveness of Petrohawk’s or any member of the BHP Billiton Group’s strategies to capture opportunities presented by changes in prices and to manage its exposure to price volatility, (viii) beliefs and assumptions about weather and general economic conditions, (ix) beliefs regarding the U.S. economy, its trajectory and its impacts, as well as the stock price of each of Petrohawk, BHP Billiton Plc and BHP Billiton Limited, (x) projected operating or financial results, including anticipated cash flows from operations, revenues and profitability, (xi) expectations regarding Petrohawk’s or any member of the BHP Billiton Group’s revolver capacity, credit facility compliance, collateral demands, capital expenditures, interest expense and other payments, (xii) Petrohawk’s or any member of the BHP Billiton Group’s ability to efficiently operate its assets so as to maximize its revenue generating opportunities and operating margins, (xiii) beliefs about the outcome of legal, regulatory, administrative and legislative matters, (xiv) expectations and estimates regarding capital and maintenance expenditures and its associated costs and (xv) uncertainties associated with any aspect of the Transactions, including uncertainties relating to the anticipated timing of filings and approvals relating to the Transactions, the outcome of legal proceedings that may be instituted against Petrohawk and/or others relating to the Transactions, the expected timing of completion of the Transactions, the satisfaction of the conditions to the consummation of the Transactions and the ability to complete the Transactions. Many of these risks and uncertainties relate to factors that are beyond the BHP Billiton Group’s ability to control or estimate precisely, and any or all of the BHP Billiton Group’s forward-looking statements may turn out to be wrong. The BHP Billiton Group cannot give any assurance that such forward-looking statements will prove to have been correct. The reader is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this communication. The BHP Billiton Group disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, conditions, circumstances or otherwise, except as required by applicable law.
Nothing contained herein shall be deemed to be a forecast, projection or estimate of the future financial performance of any member of the BHP Billiton Group, Petrohawk or the enlarged BHP Billiton Group following completion of the Transactions.
16
BHP Billiton Results for the year ended 30 June 2011
Further information on BHP Billiton can be found on our website: www.bhpbilliton.com
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email: Kelly.Quirke@bhpbilliton.com Brendan Harris
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email: Fiona.Martin2@bhpbilliton.com Americas
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BHP Billiton Limited ABN 49 004 028 077 BHP Billiton Plc Registration number 3196209
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Members of the BHP Billiton Group which is headquartered in Australia
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bhpbilliton
resourcing the future
BHP Billiton Group Financial Information
For the year ended 30 June 2011
Financial Information
Contents
Financial Information Page
Consolidated Income Statement 21
Consolidated Statement of Comprehensive Income 22
Consolidated Balance Sheet 23
Consolidated Cash Flow Statement 24
Consolidated Statement of Changes in Equity 25
Notes to the Financial Information 28
The financial information included in this document for the year ended 30 June 2011 is unaudited and has been derived from the draft financial report of the BHP Billiton Group for the year ended 30 June 2011. The financial information does not constitute the Group’s full financial statements for the year ended 30 June 2011, which will be approved by the Board, reported on by the auditors, and subsequently filed with the UK Registrar of Companies and the Australian Securities and Investments Commission.
The financial information set out on pages 21 to 39 for the year ended 30 June 2011 has been prepared on the basis of accounting policies consistent with those applied in the 30 June 2010 financial statements contained within the Annual Report of the BHP Billiton Group, except for the following standards which have been adopted for the year ended 30 June 2011:
‘Improvements to IFRSs 2009’/AASB 2009-4 ‘Amendments to Australian Accounting Standards arising from the Annual Improvements Project’ and AASB 2009-5 ‘Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project’ include a collection of minor amendments to IFRS. These amendments include a requirement to classify expenditures which do not result in a recognised asset as a cash flow from operating activities. This has resulted in exploration cash flows of US$1,030 million for the year ended 30 June 2010 (2009: US$1,009 million), which were not recognised as assets, being reclassified from net investing cash flows to net operating cash flows in the Consolidated Cash Flow Statement.
The comparative figures for the financial years ended 30 June 2010 and 30 June 2009 are not the statutory accounts of the BHP Billiton Group for those financial years. Those accounts have been reported on by the company’s auditors and delivered to the Registrar of Companies. The reports of the auditors were (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under Section 498(2) or (3) of the UK Companies Act 2006.
All amounts are expressed in US dollars unless otherwise stated. The BHP Billiton Group’s presentation currency and the functional currency of the majority of its operations is US dollars as this is the principal currency of the economic environment in which it operates.
Where applicable, comparative figures have been adjusted to disclose them on the same basis as the current period figures. Amounts in this financial information have, unless otherwise indicated, been rounded to the nearest million dollars.
20
BHP Billiton Results for the year ended 30 June 2011
Consolidated Income Statement for the year ended 30 June 2011
Notes Year ended
Year ended
Year ended
30 June 2011 30 June 2010 30 June 2009
US$M US$M US$M
Revenue
Group production 67,903 48,193 44,113
Third party products 1 3,836 4,605 6,098
Revenue 1 71,739 52,798 50,211
Other income 531 528 589
Expenses excluding net finance costs (40,454) (33,295) (38,640)
Profit from operations 31,816 20,031 12,160
Comprising:
Group production 31,718 19,920 11,657
Third party products 98 111 503
31,816 20,031 12,160
Financial income 4 245 215 309
Financial expenses 4 (806) (674) (852)
Net finance costs 4 (561) (459) (543)
Profit before taxation 31,255 19,572 11,617
Income tax expense (6,481) (6,112) (4,784)
Royalty related taxation (net of income tax benefit) (828) (451) (495)
Total taxation expense 5 (7,309) (6,563) (5,279)
Profit after taxation 23,946 13,009 6,338
Attributable to non-controlling interests 298 287 461
Attributable to members of BHP Billiton Group 23,648 12,722 5,877
Earnings per ordinary share (basic) (US cents) 6 429.1 228.6 105.6
Earnings per ordinary share (diluted) (US cents) 6 426.9 227.8 105.4
Dividends per ordinary share – paid during the period (US cents) 7 91.0 83.0 82.0
Dividends per ordinary share – declared in respect of the period (US cents) 7 101.0 87.0 82.0
The accompanying notes form part of this financial information.
21
Financial Information
Consolidated Statement of Comprehensive Income for the year ended 30 June 2011
Year ended Year ended Year ended
30 June 2011 30 June 2010 30 June 2009
US$M US$M US$M
Profit after taxation 23,946 13,009 6,338
Other comprehensive income
Actuarial losses on pension and medical schemes (113) (38) (227)
Available for sale investments:
Net valuation (losses)/gains taken to equity (70) 167 3
Net valuation (gains)/losses transferred to the income statement (47) 2 58
Cash flow hedges:
(Losses)/gains taken to equity – (15) 710
Realised losses transferred to the income statement – 2 22
Unrealised gains transferred to the income statement – – (48)
Gains transferred to the initial carrying amount of hedged items – – (26)
Exchange fluctuations on translation of foreign operations taken to equity 19 1 27
Exchange fluctuations on translation of foreign operations transferred to the income statement – (10) –
Tax recognised within other comprehensive income 120 111 (253)
Total other comprehensive income for the year (91) 220 266
Total comprehensive income 23,855 13,229 6,604
Attributable to non-controlling interests 284 294 458
Attributable to members of BHP Billiton Group 23,571 12,935 6,146
The accompanying notes form part of this financial information.
22
BHP Billiton Results for the year ended 30 June 2011
Consolidated Balance Sheet
as at 30 June 2011
30 June 30 June
2011 2010
US$M US$M
ASSETS
Current assets
Cash and cash equivalents 10,084 12,456
Trade and other receivables 8,197 6,543
Other financial assets 264 292
Inventories 6,154 5,334
Current tax assets 273 189
Other 308 320
Total current assets 25,280 25,134
Non-current assets
Trade and other receivables 2,093 1,381
Other financial assets 1,602 1,510
Inventories 363 343
Property, plant and equipment 68,468 55,576
Intangible assets 904 687
Deferred tax assets 3,993 4,053
Other 188 168
Total non-current assets 77,611 63,718
Total assets 102,891 88,852
LIABILITIES
Current liabilities
Trade and other payables 9,718 6,467
Interest bearing liabilities 3,519 2,191
Other financial liabilities 288 511
Current tax payable 3,693 1,685
Provisions 2,256 1,899
Deferred income 259 289
Total current liabilities 19,733 13,042
Non-current liabilities
Trade and other payables 555 469
Interest bearing liabilities 12,388 13,573
Other financial liabilities 79 266
Deferred tax liabilities 2,683 4,320
Provisions 9,269 7,433
Deferred income 429 420
Total non-current liabilities 25,403 26,481
Total liabilities 45,136 39,523
Net assets 57,755 49,329
EQUITY
Share capital – BHP Billiton Limited 1,183 1,227
Share capital – BHP Billiton Plc 1,070 1,116
Treasury shares (623) (525)
Reserves 2,001 1,906
Retained earnings 53,131 44,801
Total equity attributable to members of BHP Billiton Group 56,762 48,525
Non-controlling interests 993 804
Total equity 57,755 49,329
The accompanying notes form part of this financial information.
23
Financial Information
Consolidated Cash Flow Statement for the year ended 30 June 2011
Year ended Year ended Year ended
30 June 2011 30 June 2010 30 June 2009
US$M US$M US$M
Operating activities
Profit before taxation 31,255 19,572 11,617
Adjustments for:
Non-cash exceptional items (150) (255) 5,460
Depreciation and amortisation expense 5,039 4,759 3,871
Net gain on sale of non-current assets (41) (114) (38)
Impairments of property, plant and equipment, financial assets and intangibles 74 35 190
Employee share awards expense 266 170 185
Financial income and expenses 561 459 543
Other (384) (265) (320)
Changes in assets and liabilities:
Trade and other receivables (1,960) (1,713) 4,894
Inventories (792) (571) (116)
Trade and other payables 2,780 565 (847)
Net other financial assets and liabilities 46 (90) (769)
Provisions and other liabilities 387 (306) (497)
Cash generated from operations 37,081 22,246 24,173
Dividends received 12 20 30
Interest received 107 99 205
Interest paid (562) (520) (519)
Income tax refunded 74 552 –
Income tax paid (6,025) (4,931) (5,129)
Royalty related taxation paid (607) (576) (906)
Net operating cash flows 30,080 16,890 17,854
Investing activities
Purchases of property, plant and equipment (11,147) (9,323) (9,492)
Exploration expenditure (1,240) (1,333) (1,243)
Exploration expenditure expensed and included in operating cash flows 981 1,030 1,009
Purchase of intangibles (211) (85) (141)
Investment in financial assets (238) (152) (40)
Investment in subsidiaries, operations and jointly controlled entities, net of their cash (4,807) (508) (286)
Payment on sale of operations – (156) (126)
Cash outflows from investing activities (16,662) (10,527) (10,319)
Proceeds from sale of property, plant and equipment 80 132 164
Proceeds from financial assets 118 34 96
Proceeds from sale or partial sale of subsidiaries, operations and jointly controlled entities, net of their cash – 376 17
Net investing cash flows (16,464) (9,985) (10,042)
Financing activities
Proceeds from interest bearing liabilities 1,374 567 7,323
Proceeds from debt related instruments 222 103 354
Repayment of interest bearing liabilities (2,173) (1,155) (3,748)
Proceeds from ordinary shares 32 12 29
Contributions from non-controlling interests – 335 –
Purchase of shares by Employee Share Ownership Plan (“ESOP”) trusts (469) (274) (169)
Share buy-back – BHP Billiton Limited (6,265) – –
Share buy-back – BHP Billiton Plc (3,595) – –
Dividends paid (5,054) (4,618) (4,563)
Dividends paid to non-controlling interests (90) (277) (406)
Net financing cash flows (16,018) (5,307) (1,180)
Net (decrease)/increase in cash and cash equivalents (2,402) 1,598 6,632
Cash and cash equivalents, net of overdrafts, at beginning of period 12,455 10,831 4,173
Effect of foreign currency exchange rate changes on cash and cash equivalents 27 26 26
Cash and cash equivalents, net of overdrafts, at end of period 10,080 12,455 10,831
The accompanying notes form part of this financial information.
24
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BHP Billiton Results for the year ended 30 June 2011 Consolidated Statement of Changes in Equity for the year ended 30 June 2011 For the year ended 30 June 2011 Attributable to members of the BHP Billiton Group US$M Share Share Treasury Reserves Retained Total equity Non- Total equity capital capital shares earnings attributable controlling – BHP – BHP to members interests Billiton Billiton Plc of BHP Limited Billiton Group Balance as at 1 July 2010 1,227 1,116 (525) 1,906 44,801 48,525 804 49,329 Profit after taxation – – – – 23,648 23,648 298 23,946 Other comprehensive income: Actuarial losses on pension and medical schemes – – – – (105) (105) (8) (113) Net valuation (losses)/gains on available for sale investments taken to equity – – – (71) (71) 1 (70) Net valuation gains on available for sale investments transferred to the income statement – – – (38) – (38) (9)(47) Exchange fluctuations on translation of foreign operations taken to equity – – – 19 – 19 – 19 Tax recognised within other comprehensive income – – – 24 94 118 2 120 Total comprehensive income – – – (66) 23,637 23,571 284 23,855 Transactions with owners: Purchase of shares by ESOP trusts – – (469) – – (469) – (469) Employee share awards exercised net of employee contributions – – 454 (121) (294) 39 – 39 Employee share awards forfeited – – – (9) 9 – – – Accrued employee entitlement for unvested awards – – – 266 – 266 – 266 BHP Billiton Limited shares bought back and cancelled (44) – – – (6,301) (6,345) – (6,345) BHP Billiton Plc shares bought back – – (3,678) – – (3,678) – (3,678) BHP Billiton Plc shares cancelled – (46) 3,595 46 (3,595) – – – Distribution to option holders – – – (21) – (21) (17) (38) Dividends – – – – (5,126) (5,126) (90) (5,216) Equity contributed – – – – – – 12 12 Balance as at 30 June 2011 1,183 1,070 (623) 2,001 53,131 56,762 993 57,755 The accompanying notes form part of this financial information. 25 |
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Financial Information Consolidated Statement of Changes in Equity for the year ended 30 June 2011 (continued) For the year ended 30 June 2010 Attributable to members of the BHP Billiton Group US$M Share Share Treasury Reserves Retained Total equity Non- Total equity capital capital shares earnings attributable controlling – BHP – BHP to members interests Billiton Billiton Plc of BHP Limited Billiton Group Balance as at 1 July 2009 1,227 1,116 (525) 1,305 36,831 39,954 757 40,711 Profit after taxation – – – – 12,722 12,722 287 13,009 Other comprehensive income: Actuarial losses on pension and medical schemes – – – – (38) (38) – (38) Net valuation gains on available for sale investments taken to equity – – – 160 – 160 7 167 Net valuation losses on available for sale investments transferred to the income statement – – – 2 – 2 – 2 Losses on cash flow hedges taken to equity – – – (15) – (15) – (15) Realised losses on cash flow hedges transferred to the income statement – – – 2 – 2 – 2 Exchange fluctuations on translation of foreign operations taken to equity – – – 1 – 1 – 1 Exchange fluctuations on translation of foreign operations transferred to the income statement – – – (10) – (10) – (10) Tax recognised within other comprehensive income – – – 57 54 111 – 111 Total comprehensive income – – – 197 12,738 12,935 294 13,229 Transactions with owners: Purchase of shares by ESOP Trusts – – (274) – – (274) – (274) Employee share awards exercised net of employee contributions – – 274 (88) (178) 8 – 8 Employee share awards forfeited – – – (28) 28 – – – Accrued employee entitlement for unvested awards – – – 170 – 170 – 170 Issue of share options to non-controlling interests – – – 43 – 43 16 59 Distribution to option holders – – – (10) – (10) (6) (16) Dividends – – – – (4,618) (4,618) (277) (4,895) Equity contributed – – – 317 – 317 20 337 Balance as at 30 June 2010 1,227 1,116 (525) 1,906 44,801 48,525 804 49,329 26 |
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BHP Billiton Results for the year ended 30 June 2011 Consolidated Statement of Changes in Equity for the year ended 30 June 2011 (continued) For the year ended 30 June 2009 Attributable to members of the BHP Billiton Group US$M Share Share Treasury Reserves Retained Total equity Non- Total equity capital capital shares earnings attributable controlling – BHP – BHP to members interests Billiton Billiton Plc of BHP Limited Billiton Group Balance as at 1 July 2008 1,227 1,116 (514) 750 35,756 38,335 708 39,043 Profit after taxation – – – – 5,877 5,877 461 6,338 Other comprehensive income: Actuarial losses on pension and medical schemes – – – – (224) (224) (3) (227) Net valuation gains on available for sale investments taken to equity – – – 3 – 3 – 3 Net valuation losses on available for sale investments transferred to the income statement – – – 58 – 58 – 58 Gains on cash flow hedges taken to equity – – – 710 – 710 – 710 Realised losses on cash flow hedges transferred to the income statement – – – 22 – 22 – 22 Unrealised gains on cash flow hedges transferred to the income statement – – – (48) – (48) – (48) Gains on cash flow hedges transferred to initial carrying amount of hedged items – – – (26) – (26) – (26) Exchange fluctuations on translation of foreign operations taken to equity – – – 27 – 27 – 27 Tax recognised within other comprehensive income – – – (342) 89 (253) – (253) Total comprehensive income – – – 404 5,742 6,146 458 6,604 Transactions with owners: Purchase of shares by ESOP Trusts – – (169) – – (169) – (169) Employee share awards exercised net of employee contributions – – 158 (34) (104) 20 – 20 Accrued employee entitlement for unvested awards – – – 185 – 185 – 185 Dividends – – – – (4,563) (4,563) (406) (4,969) Equity contributed – – – – – – (3) (3) Balance as at 30 June 2009 1,227 1,116 (525) 1,305 36,831 39,954 757 40,711 27 |
Financial Information
Notes to the Financial Information
1. Segment reporting
The Group operates nine Customer Sector Groups aligned with the commodities which we extract and market, reflecting the structure used by the Group’s management to assess the performance of the Group:
Customer Sector Group Principal activities
Petroleum Exploration, development and production of oil and gas
Aluminium Mining of bauxite, refining of bauxite into alumina and smelting of alumina
into aluminium metal
Base Metals Mining of copper, silver, lead, zinc, molybdenum, uranium and gold
Diamonds and Specialty Products Mining of diamonds and titanium minerals; potash development
Stainless Steel Materials Mining and production of nickel products
Iron Ore Mining of iron ore
Manganese Mining of manganese ore and production of manganese metal and alloys
Metallurgical Coal Mining of metallurgical coal
Energy Coal Mining of thermal (energy) coal
Group and unallocated items represent Group centre functions. Exploration and technology activities are recognised within relevant segments.
It is the Group’s policy that inter-segment sales are made on a commercial basis.
28
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BHP Billiton Results for the year ended 30 June 2011 1. Segment reporting (continued) US$M Petroleum Aluminium Base Diamonds Stainless Iron Ore Manganese Metallurgical Energy Group and BHP Metals and Steel Coal Coal unallocated Billiton Specialty Materials items/ Group Products eliminations Year ended 30 June 2011 Revenue Group production 10,603 3,601 13,550 1,517 3,698 20,182 2,423 7,565 4,651 – 67,790 Third party products 127 1,620 602 – 158 93 – – 851 385 3,836 Rendering of services 2 – – – – 98 – 8 5 – 113 Inter-segment revenue 5 – – – 5 39 – – – (49) – Total revenue (a) 10,737 5,221 14,152 1,517 3,861 20,412 2,423 7,573 5,507 336 71,739 Underlying EBITDA (b) 8,319 596 7,525 779 990 13,946 780 3,027 1,469 (338) 37,093 Depreciation and amortisation (1,913) (330) (735) (192) (404) (618) (83) (357) (340) (67) (5,039) Impairment (losses)/reversals recognised (76) – – – 2 – – – – – (74) Underlying EBIT (b) 6,330 266 6,790 587 588 13,328 697 2,670 1,129 (405) 31,980 Comprising: Group production 6,325 275 6,796 587 583 13,296 697 2,670 1,058 (405) 31,882 Third party products 5 (9) (6) – 5 32 – – 71 – 98 Underlying EBIT (b) 6,330 266 6,790 587 588 13,328 697 2,670 1,129 (405) 31,980 Net finance costs (561) Exceptional items (164) Profit before taxation 31,255 Capital expenditure 1,984 1,329 1,404 319 651 3,627 276 1,172 754 94 11,610 Total assets 18,645 9,602 15,973 2,833 4,912 17,585 2,439 6,731 6,176 17,995 102,891 Total liabilities 4,500 1,606 3,118 664 1,579 3,652 1,049 2,088 2,386 24,494 45,136 (a) Revenue not attributable to reportable segments reflects sales of freight and fuel to third parties. (b) Underlying EBIT is earnings before net finance costs and taxation and any exceptional items. Underlying EBITDA is Underlying EBIT, before depreciation, amortisation and impairments. 29 |
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Financial Information 1. Segment reporting (continued) US$M Petroleum Aluminium Base Diamonds Stainless Iron Ore Manganese Metallurgical Energy Group and BHP Metals and Steel Coal Coal unallocated Billiton Specialty Materials items/ Group Products eliminations Year ended 30 June 2010 Revenue Group production 8,682 2,948 9,528 1,272 3,311 10,964 2,143 6,019 3,214 – 48,081 Third party products 86 1,405 881 – 306 67 7 – 1,051 802 4,605 Rendering of services 3 – – – – 69 – 40 – – 112 Inter-segment revenue 11 – – – – 39 – – – (50) – Total revenue (a) 8,782 4,353 10,409 1,272 3,617 11,139 2,150 6,059 4,265 752 52,798 Underlying EBITDA (b) 6,571 684 5,393 648 1,085 6,496 784 2,363 971 (482) 24,513 Depreciation and amortisation (1,998) (278) (729) (163) (427) (495) (72) (309) (228) (60) (4,759) Impairment (losses)/reversals recognised – – (32) – 10 – – (1) (13) 1(35) Underlying EBIT (b) 4,573 406 4,632 485 668 6,001 712 2,053 730 (541) 19,719 Comprising: Group production 4,570 393 4,639 485 646 6,003 717 2,053 642 (540) 19,608 Third party products 3 13 (7) – 22 (2) (5) – 88 (1) 111 Underlying EBIT (b) 4,573 406 4,632 485 668 6,001 712 2,053 730 (541) 19,719 Net finance costs (459) Exceptional items 312 Profit before taxation 19,572 Capital expenditure 1,951 1,019 763 127 265 3,838 182 653 881 87 9,766 Total assets 12,733 8,078 14,970 2,588 4,507 13,592 2,082 5,597 5,425 19,280 88,852 Total liabilities 3,175 1,318 2,621 527 1,154 2,526 794 1,475 1,965 23,968 39,523 30 |
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BHP Billiton Results for the year ended 30 June 2011 1. Segment reporting (continued) US$M Petroleum Aluminium Base Diamonds Stainless Iron Ore Manganese Metallurgical Energy Group and BHP Metals and Steel Coal Coal unallocated Billiton Specialty Materials items/ Group Products eliminations Year ended 30 June 2009 Revenue Group production 6,924 3,219 6,616 896 2,202 9,815 2,473 7,988 3,830 – 43,963 Third party products 192 932 488 – 112 132 63 18 2,694 1,467 6,098 Rendering of services 6 – – – – 61 – 81 – 2 150 Inter-segment revenue 89 – 1 – 41 40 – – – (171) – Total revenue (a) 7,211 4,151 7,105 896 2,355 10,048 2,536 8,087 6,524 1,298 50,211 Underlying EBITDA (b) 5,456 476 1,994 370 (366) 6,631 1,397 4,988 1,676 (347) 22,275 Depreciation and amortisation (1,288) (298) (663) (222) (439) (384) (48) (277) (210) (42) (3,871) Impairment (losses)/reversals recognised (83) 14 (39) (3) (49) (18) – – (6) (6) (190) Underlying EBIT (b) 4,085 192 1,292 145 (854) 6,229 1,349 4,711 1,460 (395) 18,214 Comprising: Group production 4,081 202 1,326 145 (905) 6,022 1,358 4,704 1,174 (396) 17,711 Third party products 4 (10) (34) – 51 207 (9) 7 286 1 503 Underlying EBIT (b) 4,085 192 1,292 145 (854) 6,229 1,349 4,711 1,460 (395) 18,214 Net finance costs (543) Exceptional items (6,054) Profit before taxation 11,617 Capital expenditure 1,905 863 1,018 112 685 1,922 279 1,562 876 114 9,336 Total assets 12,444 7,575 14,812 2,073 4,767 8,735 1,454 4,929 4,555 17,426 78,770 Total liabilities 3,388 1,242 2,995 292 1,482 1,501 571 1,249 2,004 23,335 38,059 31 |
Financial Information
2. Exceptional items
Exceptional items are those items where their nature and amount is considered material to the financial report. Such items included within the Group’s profit for the year are detailed below.
Year ended 30 June 2011 Gross Tax Net
US$M US$M US$M
Exceptional items by category
Withdrawn offer for PotashCorp (314) – (314)
Newcastle steelworks rehabilitation 150 (45) 105
Release of income tax provisions – 718 718
Reversal of deferred tax liabilities – 1,455 1,455
(164) 2,128 1,964
Withdrawn offer for PotashCorp:
The Group withdrew its offer for PotashCorp on 15 November 2010 following the Board’s conclusion that the condition of the offer relating to receipt of a net benefit as determined by the Minister of Industry under the Investment Canada Act could not be satisfied. The Group incurred fees associated with the US$45 billion debt facility (US$240 million), investment bankers’, lawyers’ and accountants’ fees, printing expenses and other charges (US$74 million) in progressing this matter during the period up to the withdrawal of the offer, which were expensed as operating costs in the year ended 30 June 2011.
Newcastle steelworks rehabilitation:
The Group recognised a decrease of US$150 million (US$45 million tax charge) to rehabilitation obligations in respect of former operations at the Newcastle steelworks (Australia) following a full review of the progress of the Hunter River Remediation Project and estimated costs to completion.
Release of income tax provisions:
The Australian Taxation Office (ATO) issued amended assessments in prior years denying bad debt deductions arising from the investments in Beenup and Boodarie Iron and the denial of capital allowance claims made on the Boodarie Iron project. The Group challenged the assessments and was successful on all counts before the Full Federal Court. The ATO obtained special leave in September 2010 to appeal to the High Court in respect of the denial of capital allowance claims made on the Boodarie Iron project. The Group’s position in respect of the capital allowance claims on the Boodarie Iron project was confirmed by the High Court in June 2011. As a result of these appeals, US$138 million was released from the Group’s income tax provision in September 2010 and US$580 million in June 2011.
Reversal of deferred tax liabilities:
Consistent with the functional currency of the Group’s operations, eligible Australian entities elected to adopt a US dollar tax functional currency from 1 July 2011. As a result, the deferred tax liability relating to certain US dollar denominated financial arrangements has been derecognised, resulting in a credit to income tax expense of US$1,455 million.
32
BHP Billiton Results for the year ended 30 June 2011
2. Exceptional items (continued)
Year ended 30 June 2010 Gross Tax Net
US$M US$M US$M
Exceptional items by category
Pinal Creek rehabilitation 186 (53) 133
Disposal of Ravensthorpe nickel operations 653 (196) 457
Restructuring of operations and deferral of projects (298) 12 (286)
Renegotiation of power supply agreements (229) 50 (179)
Release of income tax provisions – 128 128
312 (59) 253
Pinal Creek rehabilitation:
On 22 February 2010 a settlement was reached in relation to the Pinal Creek (US) groundwater contamination which resulted in other parties taking on full responsibility for ground water remediation and partly funding the Group for past and future rehabilitation costs. As a result, a gain of US$186 million (US$53 million tax expense) was recognised reflecting the release of rehabilitation provisions and cash received.
Disposal of Ravensthorpe nickel operations:
On 9 December 2009, the Group announced it had signed an agreement to sell the Ravensthorpe nickel operations (Australia). The sale was completed on 10 February 2010. As a result of the sale, impairment charges recognised as exceptional items in the financial year ended 30 June 2009 were partially reversed totalling US$611 million (US$183 million tax expense). In addition, certain obligations that remained with the Group were mitigated and related provisions released; together with minor net operating costs this resulted in a gain of US$42 million (US$13 million tax expense).
Restructuring of operations and deferral of projects:
Continuing power supply constraints impacting the Group’s three Aluminium smelter operations in southern Africa, and temporary delays with the Guinea Alumina project, gave rise to charges for the impairment of property, plant and equipment and restructuring provisions. A total charge of US$298 million (US$12 million tax benefit) was recognised by the Group in the year ended 30 June 2010.
Renegotiation of power supply arrangements:
Renegotiation of long term power supply arrangements in southern Africa impacted the value of embedded derivatives contained within those arrangements. A total charge of US$229 million (US$50 million tax benefit) was recognised by the Group in the year ended 30 June 2010.
Release of income tax provisions:
The Australian Taxation Office (ATO) issued amended assessments in prior years denying bad debt deductions arising from the investments in Hartley, Beenup and Boodarie Iron and the denial of capital allowance claims made on the Boodarie Iron project. BHP Billiton lodged objections and was successful on all counts in the Federal Court and the Full Federal Court. The ATO has not sought to appeal the Boodarie Iron bad debt disallowance to the High Court which resulted in a release of US$128 million from the Group’s income tax provisions. The ATO sought special leave to appeal to the High Court in relation to the Beenup bad debt disallowance and the denial of the capital allowance claims on the Boodarie Iron project and was granted special leave only in relation to the denial of the capital allowance claims on the Boodarie Iron project.
33
Financial Information
2. Exceptional items (continued)
Year ended 30 June 2009 Gross Tax Net
US$M US$M US$M
Exceptional items by category
Suspension of Ravensthorpe nickel operations (3,615) 1,076 (2,539)
Announced sale of Yabulu refinery (510) (175) (685)
Withdrawal or sale of other operations (665) (23) (688)
Deferral of projects and restructuring of operations (306) 86 (220)
Newcastle steelworks rehabilitation (508) 152 (356)
Lapsed offers for Rio Tinto (450) 93 (357)
(6,054) 1,209 (4,845)
Suspension of Ravensthorpe nickel operations:
On 21 January 2009, the Group announced the suspension of operations at Ravensthorpe nickel operations (Australia) and as a consequence stopped the processing of the mixed nickel cobalt hydroxide product at Yabulu (Australia). As a result, an impairment charge and increased provisions for contract cancellation, redundancy and other closure costs of US$3,615 million (US$1,076 million tax benefit) were recognised. This exceptional item did not include the loss from operations of Ravensthorpe nickel operations of US$173 million.
Announced sale of Yabulu refinery:
On 3 July 2009, the Group announced the sale of the Yabulu nickel operations. As a result, impairment charges of US$510 million (US$nil tax benefit) were recognised in addition to those recognised on suspension of the Ravensthorpe nickel operations. As a result of the sale, deferred tax assets of US$175 million were no longer expected to be realised by the Group and were recognised as a charge to income tax expense. The remaining assets and liabilities of the Yabulu operations were classified as held for sale as at 30 June 2009.
Withdrawal or sale of other operations:
As part of the Group’s regular review of the long term viability of operations, a total charge of US$665 million (US$23 million tax expense) was recognised primarily in relation to the decisions to cease development of the Maruwai Haju trial mine (Indonesia), sell the Suriname operations, suspend copper sulphide mining operations at Pinto Valley (US) and cease the pre-feasibility study at Corridor Sands (Mozambique). The remaining assets and liabilities of the Suriname operations were classified as held for sale as at 30 June 2009.
Deferral of projects and restructuring of operations:
As part of the Group’s regular review of the long term viability of continuing operations, a total charge of US$306 million (US$86 million tax benefit) was recognised primarily in relation to the deferral of expansions at the Nickel West operations (Australia), deferral of the Guinea Alumina project (Guinea) and the restructuring of the Bayside Aluminium Casthouse operations (South Africa).
Newcastle steelworks rehabilitation:
The Group recognised a charge of US$508 million (US$152 million tax benefit) for additional rehabilitation obligations in respect of former operations at the Newcastle steelworks (Australia). The increase in obligations related to changes in the estimated volume of sediment in the Hunter River requiring remediation and treatment, and increases in estimated treatment costs.
34
BHP Billiton Results for the year ended 30 June 2011
2. Exceptional items (continued)
Lapsed offers for Rio Tinto:
The Group’s offers for Rio Tinto lapsed on 27 November 2008 following the Board’s decision that it no longer believed that completion of the offers was in the best interests of BHP Billiton shareholders. The Group incurred fees associated with the US$55 billion debt facility (US$156 million cost, US$31 million tax benefit), investment bankers’, lawyers’ and accountants’ fees, printing expenses and other charges (US$294 million cost, US$62 million tax benefit) in progressing this matter over the 18 months up to the lapsing of the offers, which were expensed in the year ended 30 June 2009.
3. Interests in jointly controlled entities
Major shareholdings in jointly Ownership interest at BHP Billiton Group
controlled entities reporting date (a) Contribution to profit after taxation
2011 2010 2009 2011 2010 2009
% % % US$M US$M US$M
Mozal SARL 47.1 47.1 47.1 66 4 84
Compañia Minera Antamina SA 33.75 33.75 33.75 602 438 185
Minera Escondida Limitada 57.5 57.5 57.5 2,694 2,175 422
Samarco Mineracao SA 50 50 50 906 430 340
Carbones del Cerrejón LLC 33.33 33.33 33.33 231 172 243
Other (b) (172) (145) 159
Total 4,327 3,074 1,433
(a) The ownership interest at the Group’s and the jointly controlled entity’s reporting date are the same. When the annual financial reporting date is different to the Group’s, financial information is obtained as at 30 June in order to report on a basis consistent with the Group’s reporting date.
(b) Includes the Group’s effective interest in the Richards Bay Minerals joint venture of 37.76 per cent (2010: 37.76 per cent; 2009: 50 per cent), the Guinea Alumina project (ownership interest 33.3 per cent; 2010: 33.3 per cent; 2009: 33.3 per cent), the Newcastle Coal Infrastructure Group Pty Ltd (ownership interest 35.5 per cent; 2010: 35.5 per cent; 2009: 35.5 per cent) and other immaterial jointly controlled entities.
4. Net finance costs
2011 2010 2009
US$M US$M US$M
Financial expenses
Interest on bank loans and overdrafts 19 24 47
Interest on all other borrowings 471 460 527
Finance lease and hire purchase interest 12 14 15
Dividends on redeemable preference shares – – 1
Discounting on provisions and other liabilities 411 359 315
Discounting on post-retirement employee benefits 128 130 132
Interest capitalised (a) (256) (301) (149)
Fair value change on hedged loans (140) 131 390
Fair value change on hedging derivatives 110 (138) (377)
Exchange variations on net debt 51 (5) (49)
806 674 852
Financial income
Interest income (141) (117) (198)
Expected return on pension scheme assets (104) (98) (111)
(245) (215) (309)
Net finance costs 561 459 543
(a) Interest has been capitalised at the rate of interest applicable to the specific borrowings financing the assets under construction or, where financed through general borrowings, at a capitalisation rate representing the average interest rate on such borrowings. For the year ended 30 June 2011 the capitalisation rate was 2.87 per cent (2010: 3.5 per cent; 2009: 4.25 per cent).
35
Financial Information
5. Taxation
2011 2010 2009
US$M US$M US$M
Taxation expense including royalty related
taxation
UK taxation expense 21 178 319
Australian taxation expense 3,503 3,798 3,158
Overseas taxation expense 3,785 2,587 1,802
Total taxation expense 7,309 6,563 5,279
Excluding the impacts of royalty related taxation, exceptional items and exchange rate movements, taxation expense was US$10,082 million representing an underlying effective tax rate of 32.1 per cent (2010: 30.9 per cent; 2009: 31.4 per cent).
Government imposed royalty arrangements calculated by reference to profits after adjustment for temporary differences are reported as royalty related taxation. Royalty related taxation contributed US$828 million to taxation expense representing an effective rate of 2.6 per cent (2010: US$451 million and 2.3 per cent; 2009: US$495 million and 4.3 per cent).
Exceptional items decreased taxation expense by US$2,128 million (2010: increase of US$59 million; 2009: decrease of US$1,209 million) predominantly due to the reversal of deferred tax liabilities of US$1,455 million following the election of eligible Australian entities to adopt a US dollar tax functional currency, as well as the release of tax provisions of US$718 million following the Group’s position being confirmed with respect to ATO amended assessments.
Exchange rate movements decreased taxation expense by US$1,473 million (2010: increase of US$106 million; 2009: increase of US$444 million) predominantly due to the revaluation of local currency deferred tax assets arising from future tax depreciation of US$2,481 million, partly offset by the revaluation of local currency tax liabilities and deferred tax balances arising from other monetary items and temporary differences which amounted to US$1,008 million.
Total taxation expense including royalty related taxation and the predominantly non-cash exceptional items and exchange rate movements described above, was US$7,309 million, representing an effective rate of 23.4 per cent (2010: 33.5 per cent; 2009: 45.4 per cent).
6. Earnings per share
2011 2010 2009
Basic earnings per ordinary share (US cents) 429.1 228.6 105.6
Diluted earnings per ordinary share (US cents) 426.9 227.8 105.4
Basic earnings per American Depositary Share
(ADS) (US cents) (a) 858.2 457.2 211.2
Diluted earnings per American Depositary Share
(ADS) (US cents) (a) 853.8 455.6 210.8
Basic earnings (US$M) 23,648 12,722 5,877
Diluted earnings (US$M) 23,648 12,743 5,899
The weighted average number of shares used for the purposes of calculating diluted earnings per share reconciles to the number used to calculate basic earnings per share as follows:
Weighted average number of shares 2011 2010 2009
Million Million Million
Basic earnings per ordinary share denominator 5,511 5,565 5,565
Shares and options contingently issuable under
employee share ownership plans 29 30 33
Diluted earnings per ordinary share denominator 5,540 5,595 5,598
(a) Each American Depositary Share (ADS) represents two ordinary shares.
36
BHP Billiton Results for the year ended 30 June 2011
7. Dividends
2011 2010 2009
US$M US$M US$M
Dividends paid/payable during the period
BHP Billiton Limited 3,076 2,787 2,754
BHP Billiton Plc – Ordinary shares 2,003 1,831 1,809
– Preference shares (a) – – –
5,079 4,618 4,563
Dividends declared in respect of the period
BHP Billiton Limited 3,331 2,921 2,754
BHP Billiton Plc – Ordinary shares 2,183 1,920 1,809
– Preference shares (a) – – –
5,514 4,841 4,563
2011 2010 2009
US cents US cents US cents
Dividends paid during the period (per share)
Prior year final dividend 45.0 41.0 41.0
Interim dividend 46.0 42.0 41.0
91.0 83.0 82.0
Dividends declared in respect of the period (per share)
Interim dividend 46.0 42.0 41.0
Final dividend 55.0 45.0 41.0
101.0 87.0 82.0
Dividends are declared after period end in the announcement of the results for the period. Interim dividends are declared in February and paid in March. Final dividends are declared in August and paid in September. Dividends declared are not recorded as a liability at the end of the period to which they relate. Subsequent to year end, on 24 August 2011, BHP Billiton declared a final dividend of 55.0 US cents per share (US$2,943 million), which will be paid on 29 September 2011 (2010: 45.0 US cents per share – US$2,504 million; 2009: 41.0 US cents per share – US$2,281 million).
BHP Billiton Limited dividends for all periods presented are, or will be, fully franked based on a tax rate of 30 per cent.
2011 2010 2009
US$M US$M US$M
Franking credits as at 30 June 3,971 3,861 2,506
Franking credits arising from the payment of current tax payable 3,218 818 1,265
Total franking credits available (b) 7,189 4,679 3,771
(a) 5.5 per cent dividend on 50,000 preference shares of £1 each declared and paid annually (2010: 5.5 per cent; 2009: 5.5 per cent).
(b) The payment of the final 2011 dividend declared after 30 June 2011 will reduce the franking account balance by US$757 million.
37
Financial Information
8. Share capital
On 15 November 2010, BHP Billiton announced the reactivation of the remaining US$4.2 billion component of its previously suspended US$13 billion buy-back program and subsequently announced an expanded US$10 billion capital management program on 16 February 2011. This expanded program was completed on 29 June 2011 through a combination of on-market and off-market buy-backs as described below.
In accordance with the UK Companies Act 2006 and with the resolutions passed at the 2010 Annual General Meetings, BHP Billiton Limited purchased fully paid shares in BHP Billiton Plc on-market and then transferred those shares to BHP Billiton Plc for nil consideration and cancellation.
An off-market tender buy-back of BHP Billiton Limited shares was completed on 11 April 2011. In accordance with the structure of the buy-back, US$44 million was allocated to the share capital of BHP Billiton Limited and US$6,301 million was allocated to retained earnings. These shares were then cancelled.
Details of the purchases are shown in the table below.
Purchased by:
Total BHP Billiton Limited BHP Billiton Plc
Cost per cost
Year ended Shares purchased Number share US$M Shares US$M Shares US$M
30 June 2011 BHP Billiton Plc 94,935,748 (a) £23.96 (b) 3,678 94,935,748 3,678 – –
BHP Billiton Limited 146,899,809 A$40.85 6,345 146,899,809 6,345 – –
(a) Includes 2,181,737 shares in BHP Billiton Plc bought back as part of the above program but not cancelled as at 30 June 2011.
(b) Cost per share represents the average cost per share paid on-market by BHP Billiton Limited for BHP Billiton Plc shares in 2011. Since the commencement of the buy-back in 2006 the average cost per share was £15.67.
9. Subsequent events
On 14 July 2011, the Group announced it had entered into a definitive agreement to acquire Petrohawk Energy Corporation by means of an all-cash tender offer for all of the issued and outstanding shares of Petrohawk to be followed by a second-step merger, representing a total equity value of approximately US$12.1 billion and a total enterprise value of approximately US$15.1 billion, including the assumption of net debt. On 21 August 2011, the Group announced that all conditions to the closing of the tender offer to acquire all outstanding shares of common stock of Petrohawk for US$38.75 per share net to the seller in cash, without interest, less any applicable withholding taxes, have been satisfied. The offer expired at 12:00 midnight, New York City time, at the end of Friday, 19 August 2011, at which time approximately 293.9 million shares had been validly tendered and not withdrawn pursuant to the offer, representing approximately 97.4% of the total outstanding shares. Following payment for the tendered shares and a short-form merger being effected, the Group will own 100% of the total outstanding shares. The transaction is expected to close in the third quarter of calendar year 2011.
On 9 August 2011, the Group signed a Heads of Agreement with Leighton Holdings to acquire the HWE Mining subsidiaries that provide contract mining services to its Western Australia Iron Ore operations. The Heads of Agreement relates to the mining equipment, people and related assets that service the Area C, Yandi and Orebody 23/25 operations. These operations collectively account for almost 70 per cent of Western Australia Iron Ore’s total material movement. The purchase price is US$735 million (A$705 million), subject to working capital adjustments. Subject to due diligence, definitive agreements and relevant internal and regulatory approvals, the transaction is expected to close during the fourth quarter of calendar year 2011.
On 18 August 2011, the Group arranged a new unsecured 364-day multicurrency term and revolving credit facility for an amount of US$7.5 billion consisting of two tranches: a US$5 billion term loan and US$2.5 billion revolving credit facility.
38
BHP Billiton Results for the year ended 30 June 2011
Other than the matters outlined above, elsewhere in this financial information or in the accompanying news release, no matters or circumstances have arisen since the end of the financial 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.
39
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Preliminary results
Full year ended 30 June 2011
Marius Kloppers Chief Executive Officer
Alex Vanselow Chief Financial Officer
24 August 2011
|
Disclaimer
bhpbilliton
resourcing the future
Reliance on Third Party Information
The views expressed herein 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 presentation should not be relied upon as a recommendation or forecast by BHP Billiton.
Forward Looking Statements
This presentation may contain, in addition to historical information, certain forward-looking statements regarding future events, conditions, circumstances or the future financial performance of BHP Billiton Plc and BHP Billiton Limited and their affiliates, including North America Holdings II Inc. and BHP Billiton Petroleum (North America) Inc. (collectively, the “BHP Billiton Group”), Petrohawk Energy Corporation (“Petrohawk”) or the enlarged BHP Billiton Group following completion of the tender offer, the merger and other related transactions in respect of Petrohawk (the “Transactions”). Often, but not always, forward-looking statements can be identified by the use of words such as “plans,” “expects,” “expected,” “scheduled,” “estimates,” “intends,” “anticipates” or “believes,” or variations of such words and phrases or state that certain actions, events, conditions, circumstances or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. Such forward-looking statements are not guarantees or predictions of future performance, and are subject to known and unknown risks, uncertainties and other factors, many of which are beyond our control, that could cause actual results, performance or achievements of any member of the BHP Billiton Group or the enlarged BHP Billiton Group following completion of the Transactions to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. More detail on those risks may be found in our annual report on Form 20-F for the year ended 30 June 2010 entitled “Risk factors”, “Forward looking statements” and “Operating and financial review and prospects” filed with the U.S. Securities and Exchange Commission. Such risks and uncertainties also include: (i) the risk that not all conditions of the merger will be satisfied or waived, (ii) beliefs and assumptions relating to available borrowing capacity and capital resources generally, (iii) expectations regarding environmental matters, including costs of compliance and the impact of potential regulations or changes to current regulations to which Petrohawk or any member of the BHP Billiton Group is or could become subject, (iv) beliefs about oil and gas reserves, (v) anticipated liquidity in the markets in which BHP Billiton or any member of the BHP Billiton Group transacts, including the extent to which such liquidity could be affected by poor economic and financial market conditions or new regulations and any resulting impacts on financial institutions and other current and potential counterparties, (vi) beliefs and assumptions about market competition and the behaviour of other participants in the oil and gas exploration, development or production industries, (vii) the effectiveness of Petrohawk’s or any member of the BHP Billiton Group’s strategies to capture opportunities presented by changes in prices and to manage its exposure to price volatility, (viii) beliefs and assumptions about weather and general economic conditions, (ix) beliefs regarding the U.S. economy, its trajectory and its impacts, as well as the stock price of each of Petrohawk, BHP Billiton Plc and BHP Billiton Limited, (x) projected operating or financial results, including anticipated cash flows from operations, revenues and profitability, (xi) expectations regarding Petrohawk’s or any member of the BHP Billiton Group’s revolver capacity, credit facility compliance, collateral demands, capital expenditures, interest expense and other payments, (xii) Petrohawk’s or any member of the BHP Billiton Group’s ability to efficiently operate its assets so as to maximize its revenue generating opportunities and operating margins, (xiii) beliefs about the outcome of legal, regulatory, administrative and legislative matters, (xiv) expectations and estimates regarding capital and maintenance expenditures and its associated costs and (xv) uncertainties associated with any aspect of the Transactions, including uncertainties relating to the anticipated timing of filings and approvals relating to the Transactions, the outcome of legal proceedings that may be instituted against Petrohawk and/or others relating to the Transactions, the expected timing of completion of the Transactions, the satisfaction of the conditions to the consummation of the Transactions and the ability to complete the Transactions. Many of these risks and uncertainties relate to factors that are beyond the BHP Billiton Group’s ability to control or estimate precisely, and any or all of the BHP Billiton Group’s forward-looking statements may turn out to be wrong. The BHP Billiton Group cannot give any assurance that such forward-looking statements will prove to have been correct. The reader is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. The BHP Billiton Group disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, conditions, circumstances or otherwise, except as required by applicable law.
Nothing contained herein shall be deemed to be a forecast, projection or estimate of the future financial performance of any member of the BHP Billiton Group, Petrohawk or the enlarged BHP Billiton Group following completion of the Transactions.
No Offer of Securities
Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell BHP Billiton securities in any jurisdiction.
Non-GAAP Financial Information
BHP Billiton results are reported under International Financial Reporting Standards (IFRS). References to Underlying EBIT and EBITDA exclude any exceptional items. A reconciliation to statutory EBIT is contained within the profit announcement, available at our website www.bhpbilliton.com.
Preliminary results, 24 August 2011 Slide 2
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Disclaimer (continued)
bhpbilliton
resourcing the future
Exploration Results and Mineral Resources
This presentation includes information on Exploration Results (Potential Mineralisation) and Mineral or Coal Resources (inclusive of Ore Reserves). Mineral Resources are compiled by: H Arvidson (MAusIMM) – Western Australian Iron Ore (WAIO), S O’Connell (MAusIMM) - Olympic Dam, A Paul (MAusIMM) – Queensland Coal, T J Kilroe (MAusIMM) - Saskatchewan Potash, and R Preece (FAusIMM) – Escondida mineral district. This is based on Mineral Resource information in the BHP Billiton 2010 Annual Report for all assets except Escondida Copper Resource which is based on the BHP Billiton Exploration and Development Report for the year ended 30 June 2011. Both reports can be found at www.bhpbilliton.com. All information is reported under the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2004’ (the JORC Code) by the following Competent Persons who were employed by BHP Billiton at the time of reporting (unless otherwise stated) and have the required qualifications and experience to estimate and report Exploration Results, Mineral Resources and Ore Reserves under the JORC Code.
Mineral or Coal Resources. WAIO: D. Reid (MAusIMM), A Voortman (FAusIMM), M Smith (MAusIMM), S Nag (MAIG), H Arvidson (MAusIMM), S Harrison (MAIG), C Williams (MAIG), D Stephens (MAIG), P Whitehouse (MAusIMM); Olympic Dam: S O’Connell (MAusIMM); Queensland Coal: P Wakeling (MAusIMM), J Centofanti (MAusIMM), D Frater (MAusIMM), A Paul (MAusIMM), C Schuler (MAIG), P Handley (MAusIMM); Potash: J McElroy (MAusIMM), B Nemeth (MAusIMM), D Mackintosh (APEGS, employed by ADM Consulting); Escondida: O Cortes (MAusIMM, employed by Minera Escondida Limitada).
Exploration Results are compiled by: WAIO: J Knight (MAIG); Olympic Dam: S O’Connell (MAusIMM); Queensland Coal: A Paul (MAusIMM); D Dunn (MAusIMM); Potash: J. McElroy (MAusIMM), (reported to BoA Merrill Lynch Global Metals and Mining Conference, Barcelona, May 2011), Escondida: J des Rivieres (IGI).
The Compilers verify that this report is based on and fairly reflects the Exploration Results and Mineral Resources information in the supporting documentation and agree with the form and context information presented.
Mineral Resource classification and Potential Mineralisation Ranges for each province are contained in Table 1.
Table 1
Province Measured Resource (Mt) Indicated Resource (Mt) Inferred Resource (Mt) Range of Potential Mineralisation (Bt) Low Mid High
Western Australia Iron Ore 1,918 3,476 10,730 15 31 46
Olympic Dam 1,246 @ 1.11% Cu 4,623 @ 0.88% Cu 3,206 @ 0.74% Cu 1.2 @ 1.08% Cu 2.4 @ 1.08% Cu 3.6 @ 1.08% Cu Queensland Coal 2,539 5,037 5,216 13 25 37
Potash – 3,250 @ 25.4% K2O 119 @ 26.7% K2O 2.7 5.4 8.1
Escondida 3,102 @ 0.75% Cu 4,670 @ 0.59% Cu 11,730 @ 0.49% Cu 16 @ 0.4-0.6% Cu 23 @ 0.4-0.6% Cu 43 @ 0.5-0.6% Cu
Preliminary results, 24 August 2011 Slide 3
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BMA
Preliminary results
Full year ended 30 June 2011
Marius Kloppers Chief Executive Officer
bhpbilliton
resourcing the future
|
Record financial results
bhpbilliton
resourcing the future
Underlying EBIT of US$32.0 billion, up 62%
Attributable profit (excluding exceptionals) of US$21.7 billion, up 74%
Earnings per share (excluding exceptionals) of 393.5 US cents, up 76%
Net operating cash flow of US$30.1 billion, up 78%
Successful acquisition of substantial onshore, United States shale gas resources
Completion of expanded US$10 billion capital management program, six months ahead of schedule
22% rebasing of the final dividend to 55 US cents per share
Preliminary results, 24 August 2011 Slide 5
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Strong operating performance
bhpbilliton
resourcing the future
Further improvement in safety performance
Record production across four commodities and ten operations
– Successful ramp-up of Western Australia Iron Ore supply chain to 155 mtpa rate1
– First production from MAC20 energy coal project
– Substantial increase in Escondida mining complex resources2
Approval of 11 major projects for a total investment commitment of US$12.9 billion3
1. June 2011 quarter annualised shipments (100% basis).
2. BHP Billiton Exploration and Development Report for the year ended 30 June 2011.
3. BHP Billiton share.
Worsley
Preliminary results, 24 August 2011 Slide 6
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A challenging environment
bhpbilliton
resourcing the future
Supply side disruption
Industry wide capital and operating cost pressure
Increasingly tight market for skilled labour and equipment
Evolving regulatory landscape
Newman
Preliminary results, 24 August 2011 Slide 7
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Shenzi
Preliminary results
Full year ended 30 June 2011
Alex Vanselow Chief Financial Officer
bhpbilliton
resourcing the future
|
Underlying EBIT analysis
Year ended June 2011 versus June 2010
EBIT variance
(US$ billion)
bhpbilliton
resourcing the future
Uncontrollable Controllable
40.0
17.2
33.8 1.2
(2.5) (0.6) 32.0
(0.6) (1.4)
30.0 (1.0)
Net US$0.6 billion
19.7
20.0
10.0
0.0
FY10 Price1 Exchange Inflation Sub-total New operations Volume Costs2 Other FY11
1. Including the negative impact of price linked costs.
2. Excluding the impact of inflation, foreign exchange and price linked costs. Includes negative non-cash cost variance of US$255 million, largely reflecting higher depreciation and amortisation charge.
Preliminary results, 24 August 2011 Slide 9
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Strong operating performance despite external challenges
bhpbilliton
resourcing the future
Volume variance
(US$ million)
US$572 million
1,000
500
572
177
92
(93)
(112)
(287)
1,153
0
GoM
(500)
Other
(930)
(1,000)
Iron Ore
Energy Coal
Other
SSM
D&SP
Metallurgical Coal
Petroleum
New and acquired operations1
1. Reflects strong performance at the BHP Billiton operated Pyrenees oil facility and the inaugural contribution from the recently acquired Fayetteville shale assets.
Note: Volume variance calculated on Underlying EBIT using previous year margin and includes new and acquired operations.
Preliminary results, 24 August 2011 Slide 10
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World class assets and consistent execution of a well defined strategy
bhpbilliton
resourcing the future
Diversified peer production comparison
(copper equivalent units1)
100
Pre-GFC Today
BHP Billiton Peer group
1. Copper equivalent units based on long term consensus price estimates where available, indexed to 100.
Note: Peer group includes Rio Tinto, Vale, Anglo American and Xstrata.
Source: Annual Reports, press releases and BHP Billiton analysis.
Preliminary results, 24 August 2011 Slide 11
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Industry wide cost pressures continue to build
bhpbilliton
resourcing the future
Cash cost variance1
(US$ million)
0 (100) (200) (300) (400) (500)
(175) (195)
(375) (412)
Raw materials Labour & contractors Maintenance Other
Structural Non structural
1. Excluding negative non-cash cost variance of US$255 million.
Preliminary results, 24 August 2011 Slide 12
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Increasing tightness for key consumables and equipment
bhpbilliton
resourcing the future
Large mining tyres
(market supply and demand)
Market demand
Primary supplier radial capacity
2006 2008 2010 2012 2014 2016
Average mining truck lead times
(months)
2006 2007 2008 2009 2010 2011
Source: BHP Billiton analysis.
Preliminary results, 24 August 2011 Slide 13
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A uniquely diversified portfolio
bhpbilliton
resourcing the future
Underlying EBIT1
(FY11, US$ billion)
35 30 25 20 15 10 5 0
Metallurgical Coal Manganese
Iron Ore
SSM D&SP
Base Metals
Aluminium Energy Coal
Petroleum
Ferrous 51.6%
Non Ferrous 25.5%
Energy 22.9%
Underlying EBIT margin1
(FY11, %)
Metallurgical Coal
Manganese
Iron Ore
SSM
D&SP
Base Metals
Aluminium
Energy Coal
Petroleum
35%
29%
66% 16% 39% 50% 8% 23% 60%
1. Excludes third party trading activities.
Preliminary results, 24 August 2011 Slide 14
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Our business model delivers strong margins and superior returns
bhpbilliton
resourcing the future
Underlying EBIT margin1
(%)
60 50 40 30 20 10 0
FY07 FY08 FY09 FY10 FY11
Underlying return on capital
(%)
50 40 30 20 10 0
FY07 FY08 FY09 FY10 FY11
BHP Billiton Peer group
1. Includes third party trading activities.
Note: Peer group includes Rio Tinto, Vale, Anglo American and Xstrata. Source: Annual Reports, press releases and BHP Billiton analysis.
Preliminary results, 24 August 2011 Slide 15
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Disciplined and predictable approach to capital management
bhpbilliton
resourcing the future
Sources and uses of cash1
(US$ billion)
40 35 30 25 20 15 10 5 0
Net operating cash flow
Capital and exploration expenditure Cash dividends Capital management Acquisitions Gearing
Gearing
(%)
40 35 30 25 20 15 10 5 0
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11
1. Calculated on the basis of UKGAAP for periods prior to FY05. Cash flow reflects proportional consolidation of joint ventures for FY07 and future periods. Exploration expenditure incurred which has not been capitalised has been re-classified to net operating cash flow for FY06 and future periods.
Note. Excludes the acquisition of Petrohawk Energy Corporation that was announced on 14 July 2011.
Preliminary results, 24 August 2011 Slide 16
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Port Hedland
Preliminary results
Full year ended 30 June 2011
Marius Kloppers Chief Executive Officer
bhpbilliton
resourcing the future
|
Long term demand underpinned by emerging economic growth
bhpbilliton
resourcing the future
Economic growth has slowed
– Concerns regarding sovereign indebtedness
– A protracted OECD recovery remains our base case
– Tighter monetary policy in the developing world is having the intended effect
Developing economies to make a disproportionate contribution to longer term, global GDP growth
Global GDP growth rate
(% per annum)
6 5 4 3 2 1 0
Developed economies
Developing economies
1900- 1920- 1930- 1940- 1950- 1960- 1970- 1980- 1990- 2000- 2010- 2020-
1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020 2025
Source: 1900 to 1980 – J. Bradford De Long (“Estimates of World GDP”, 1998); 1980 to 2010 –
IMF World Economic Outlook Database; 2010 to 2025 Forecast – Global Insight.
Preliminary results, 24 August 2011 Slide 18
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A constrained supply response
bhpbilliton
resourcing the future
Multiple disruptions to existing supply
– Queensland metallurgical coal
– Indian iron ore
– Chilean copper
– Middle Eastern/North African oil
Under delivery of ambitious growth targets a likely indicator of future performance
– Approvals processes
– Labour
– Plant and equipment
– Financing
– Declining global resource endowment
Bowen Basin cumulative rainfall
(millimetres)
1,400 FY11
FY01 – FY10 average
700
0
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Source: www.bom.gov.au.
Under delivery of production forecasts1
(%)
Copper
Metallurgical coal
Iron ore
(15)% (10)% (5)% 0%
Source: Macquarie Commodities Research, August 2011.
1. Denotes shortfall in global CY11 production as forecast by Macquarie Commodities Research in August 2011 compared with June 2008. Production refers to seaborne iron ore, seaborne metallurgical coal (ex-USA supply) and mined copper (including SX-EW production).
Preliminary results, 24 August 2011 Slide 19
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Market fundamentals supported by higher cost sources of supply
bhpbilliton
resourcing the future
Iron ore cost curve
(US$ per tonne, 62-63% Fe, CIF China equivalent basis)
160 2001 2005 140 2010 120 Long term price forecast - 2001 Long term price forecast - 2005 Long term price forecast - 2010 100
80 60 40 20
0
0 350 700 1,050 1,400
Cumulative capacity
(million tonnes)
Note: Includes seaborne and China domestic.
Source: Macquarie Research.
Capital intensity – iron ore
(US$ per annual tonne)
300
250
200
150
100
50
0
2000 2002 2004 2006 2008 2010 2012 2014
Note: Bubble size represents annual production capacity.
Source: Company announcements and BHP Billiton analysis.
Preliminary results, 24 August 2011 Slide 20
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Uniquely diversified, tier 1 resources
bhpbilliton
resourcing the future
Legend Ratio (years)
Minerals - Minimum Mineral Inventory life at FY10 production rates
100+ Petroleum – Minimum inventory life based on FY11 production rates
Olympic Dam
Copper/Uranium
100+
100+ 200+
Queensland Coal Western Australia Iron Ore
Saskatchewan Potash
100+ Onshore US Petroleum1
100+
Escondida mineral district Copper
100+
The Inventory Life is estimated from the Mineral Inventory (sum of Potential Mineralisation and Mineral Resources inclusive of Ore Reserves) stated on a 100% basis. The detailed breakdown of Mineral Resources for all assets except Escondida Copper Mineral Resource and Onshore US Petroleum are shown in the FY10 Annual Report. FY11 Mineral Resource for Escondida Copper is shown in the BHP Billiton Exploration and Development Report for the year ended 30 June 2011. The range of Potential Mineralisation is estimated from geological information including boreholes, outcrops and geophysical information. The potential quantity is conceptual in nature, there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource. It should not be expected that the quality of the Potential Mineralisation is equivalent to that of the Mineral Resource. The ratio in years is the inventory divided by the FY10 production rate (for Potash this is the expected FY20 production rate) and does not imply that any mine planning has been completed. In Mineral Provinces (e.g. Pilbara, Bowen Basin) the inventory life of individual mines may be more or less than the number stated above.
1. Includes interests in the Fayetteville shale and Petrohawk Energy Corporation. Petroleum Reserves (Proved and Probable) are defined according to US SEC definitions. Petroleum Contingent Resources are 2C resources defined according to the Society of Petroleum Engineers Petroleum Resource Management System (SPE PRMS). Petrohawk Proved Reserves and Risked Potential Resources from Petrohawk public statements.
Preliminary results, 24 August 2011 Slide 21
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A ‘hub based’ project model = a simple and scalable organisation
bhpbilliton
resourcing the future
Saskatchewan Potash
Feasibility:
Jansen Stage 1
Potash Port Vancouver WA
Pre-feasibility:
Jansen Stages 2 & 3
Underlying EBIT1
(FY11)
Western Australia Iron Ore
Other Queensland Coal Escondida Olympic Dam
Queensland Coal
Execution:
Daunia
Hay Point Stage 3 Expansion
Feasibility:
Caval Ridge
Pre-feasibility:
BMC Wards Well
Goonyella Expansion
Port and Rail Expansion
Escondida Copper
Execution:
Escondida Ore Access
Feasibility:
Escondida Organic Growth Project 1
Escondida Oxide Leach Area Project
Pre-feasibility:
Escondida Bioleach Pad Extension IV
Western Australia Iron Ore
Execution:
WAIO Expansion to +220mtpa
Pre-feasibility:
Port Hedland Outer Harbour
Central Pilbara Mines
Olympic Dam Copper/Uranium
Feasibility:
Olympic Dam Project 1
Pre-feasibility:
Olympic Dam Project 2
1. Excludes third party trading activities.
Note: All projects remain under review until such time as they are sanctioned for execution.
Preliminary results, 24 August 2011 Slide 22
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Petrohawk – a substantial resource acquisition
bhpbilliton
resourcing the future
Total enterprise value of ~US$15.1 billion1
Natural gas is a preferred fuel in a low carbon world
Complements our recent Fayetteville shale acquisition and adds to portfolio diversity
Significant increase in Petroleum resources
Leverages our cost of capital advantage and financial capacity to accelerate production growth
Acceleration of Petrohawk’s development spend
(US$ million net, real)
7,000 6,000 5,000 4,000 3,000 2,000 1,000 0
2011 Petrohawk announced capex FY15 FY20 Range of anticipated, accelerated development spend
1. Includes debt as at 30 June 2011 of approximately US$3.8 billion less approximately US$800 million proceeds from sale of midstream assets; does not include penalties associated with the early retirement of Petrohawk’s debt facilities.
Preliminary results, 24 August 2011 Slide 23
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Execution of our tier 1 strategy will create strong and predictable, high margin growth
bhpbilliton
resourcing the future
Long term production growth
(copper equivalent units1)
200 150 100 50 0
~6% production CAGR2
FY11 FY15 FY20
1. Production from continuing operations converted to copper equivalent units based on long term consensus price estimates where available. Indexed to 100 from FY11.
2. Production CAGR from FY11 to FY20. Includes production growth from Petrohawk Energy Corporation.
Preliminary results, 24 August 2011 Slide 24
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Record financial results and a substantial commitment in tier 1 growth
bhpbilliton
resourcing the future
Strong operating performance and record financial results
Acceleration of our organic growth program with the approval of 11 major projects for a total investment commitment of US$12.9 billion
Successful acquisition of onshore, United States shale gas resources with significant production growth ahead
Completion of accelerated US$10 billion capital management initiative highlights a commitment to maintain an appropriate capital structure through all points of the economic cycle
22% rebasing of final dividend to US 55 cents per share
Preliminary results, 24 August 2011 Slide 25
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bhpbilliton
resourcing the future
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Appendix
bhpbilliton
resourcing the future
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Impact of major commodity price movements
Year ended June 2011 versus June 2010
bhpbilliton
resourcing the future
Total price variance1
(US$ million)
8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0
7,900
3,348
2,138
1,521
861
559
435
366
100
Iron Ore Base Metals Metallurgical Petroleum Energy Coal Aluminium SSM D&SP Manganese Coal
1. Including the negative impact of price linked costs.
Preliminary results, 24 August 2011 Slide 28
|
Rate of cost change
bhpbilliton
resourcing the future
Operating cost movement relative to preceding year1
(%)
14.0
10.0
6.0
2.0
(2.0)
(6.0)
Total
Excluding non-cash
9.0
8.5
7.6
6.8
5.3
4.9
4.9
4.9
4.3
4.3
4.0
3.6
0.0
(0.7)
FY05 FY06 FY07 FY08 FY09 FY10 FY11
1. Excluding the impact of inflation, foreign exchange, price linked costs and third party trading.
Preliminary results, 24 August 2011 Slide 29
|
Summary of key FX components
in tax expense/(income)
bhpbilliton
resourcing the future
Restatement of
Current tax payable
Deferred tax balances on fixed assets
Deferred tax balances on US$ debt
Deferred tax balances on timing differences
Other items
Total
June 2011 expense/(income) US$ million
695
(2,481)
234
(3)
82
(1,473)
June 2010 expense/(income) US$ million
266
(396)
289
(27)
(26)
106
Preliminary results, 24 August 2011 Slide 30
|
A weaker US dollar has ‘hidden’ implications for costs
bhpbilliton
resourcing the future
Foreign exchange gain/(loss) on balance sheet monetary items
(US$ million)
0
(200)
(251)
(400)
(140)
(129)
(600)
(118)
(89) 54
(800)(54)
(38)(29)(13)(807)
(1,000)
Iron Ore Met Petroleum Base Energy SSM Aluminium Manganese D&SP G&U EBIT
Coal Metals Coal
Preliminary results, 24 August 2011 Slide 31
|
The power of our diversified model
bhpbilliton
resourcing the future
EBIT margin1
(%)
75
Petroleum
50 Aluminium
Base Metals
D&SP
SSM
Iron Ore
25 Manganese
Metallurgical Coal
Energy Coal
Total
0
FY022 FY03 FY04 FY05 FY06 FY07 FY08 FY092 FY10 FY11
1. Calculated on the basis of UKGAAP for periods prior to FY05, except for the exclusion of PRRT from Petroleum’s and BHP Billiton Group’s results for all periods. All periods exclude third party trading activities. The Exploration and Technology business has been included in BHP Billiton Group’s results from FY02 to FY05 and excluded from Diamonds and Specialty Products.
2. Negative margins are not shown as the y-axis is set at zero. SSM had a negative EBIT margin in FY02 and FY09.
Preliminary results, 24 August 2011 Slide 32
|
Capital and exploration expenditure
bhpbilliton
resourcing the future
US$ billion FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12F
Growth 1.9 2.0 1.7 2.6 4.0 5.5 6.1 7.3 8.1 9.4
Sustaining and Other 0.8 0.7 0.9 1.3 2.1 1.6 1.8 2.0 1.7 2.2
Exploration 0.4 0.3 0.5 0.5 0.8 0.8 1.4 1.3 1.3 1.2
Total 3.1 3.0 3.1 4.4 6.9 7.9 9.3 10.6 11.1 12.8 20.0
(US$ billion)
20 Exploration
15 Sustaining capex
Growth expenditure
10
5
0
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12F
Note: Calculated on the basis of UKGAAP for periods prior to FY05. Excludes acquisitions and Petrohawk Energy Corporation capital expenditure.
Preliminary results, 24 August 2011 Slide 33
|
World class diversified project pipeline
bhpbilliton
resourcing the future
Ferrous Non-ferrous Energy
Future options
Feasibility and execution
Olympic Dam Project 2
Scarborough
Wards Well
Potash Jansen Stage 2
Potash Burr
Saraji Expansion
Potash Melville
Spence Hypogene
IndoMet Coal Expansion
Yeelirrie
WAIO Outer Harbour
Resolution
Mainline Rail
Saraji East Expansion
Boffa/Santou Refinery
Goonyella Expansion
Cerrejon P500
Potash Young
Blackwater Expansion
Caroona
Saraji East
Olympic Dam Project 3
Caval Ridge Expansion
Mad Dog Phase 2
DRC Smelter
MAC 32
Boodarie Stockyards
IndoMet Coal
MAC Underground
Potash Other
Illawarra Coal Expansion
RBM
West Africa Exploration
Nimba
Knotty Head
Peak Downs Expansion
Central Pilbara Mines
Potash Jansen Stage 3
Thebe
Queensland Rail and Port Expansion
Potash Boulder
Bioleach Pad Ext IV
Kipper
Oxide Leach
WAIO Port and Rail
NWS Nth Rankin B
WAIO Inner Harbour
Worsley E&G
Laguna Seca
Gabon
Olympic Dam Project 1
HPX3
NTP Exp 3
Escondida OGP 1
Turrum
Cerro Matoso Heap Leach 1
Escondida Ore Access
Antamina Exp
WAIO RGP 5
Potash Ports
GEMCO Exp 2
EKATI Misery
Macedon
Browse
Caval Ridge
NWS CWLH
Appin Area 9
NWS GWF
Cerrejon P40
Broad-meadow
NTP Exp 2
Potash Jansen Stage 1
Samarco 4
WAIO Jimblebar
Atlantis N2B
Daunia
MAC RX1
Guinea Alumina
As at 24 August 2011 Proposed capital expenditure (BHP Billiton share)
US$5bn+ US$501m-US$5bn £US$500m
Placement of projects not indicative of project schedule.
Preliminary results, 24 August 2011 Slide 34
|
Maturity profile analysis
bhpbilliton
resourcing the future
Debt balances1
(US$ million2)
0
700
1,400
2,100
2,800
3,500
2012 2013 2014 2015 2016 2017 2018 2019 2020 Post 2020
1. Based on debt balances as at 30 June 2011.
2. All debt balances are shown in US$ million and based on financial years.
3. Jointly Controlled Entity (‘JCE’) debt represents BHP Billiton share of the total JCE debt excluding debt provided by BHP Billiton.
4. Subsidiary debt represents BHP Billiton share of subsidiary debt based on BHP Billiton effective interest.
% of portfolio 56% 28% 0% 0%
Bank
Debt
CP
Issuance
US$
Bonds
Euro
Bonds
Capital Markets 84% Bank Supported 0%
14% 2%
Jointly Controlled
Entities3 Subsidiaries4
Asset Financing 16%
Preliminary results, 24 August 2011 Slide 35
|
Key net profit sensitivities
bhpbilliton
resourcing the future
Approximate impact1 on FY12 net profit after tax of changes of US$ million
US$1/t on iron ore price 90
US$1/bbl on oil price 35
US$1/t on metallurgical coal price 20
US¢1/lb on aluminium price 20
US¢1/lb on copper price 20
US$1/t on energy coal price 20
US¢1/lb on nickel price 2
AUD (US¢1/A$) operations2 100
RAND (0.2 Rand/US$) operations2 45
1. Assumes total volumes exposed to price.
2. Impact based on average exchange rate for the period.
Preliminary results, 24 August 2011 Slide 36
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| BHP Billiton Limited and BHP Billiton Plc | ||||
| Date: August 24, 2011 | By: | /s/ Jane McAloon | ||
| Name: | Jane McAloon | |||
| Title: | Group Company Secretary | |||