SYDNEY – BHP Group, the world’s largest miner, reported underlying earnings at the high end of analyst expectations, buoyed by a historic rally in metal prices and a significant ramp-up in copper production. The results highlight a strategic pivot for the Melbourne-based giant, as its copper division successfully offset a relatively stagnant performance in its traditional mainstay, iron ore.
For the six-month period ending in December, underlying net profit attributable to shareholders surged 22% to reach $6.2 billion. The financial outperformance sent BHP’s shares soaring 7.6% in Sydney trading to a record high, marking the stock’s most significant single-day gain in over 10 months. Investors have increasingly viewed the company as a primary beneficiary of the global energy transition, which continues to drive intensive demand for industrial metals.
The standout performer in the portfolio was the company’s copper unit, which saw underlying EBITDA jump 59% to $8 billion. This surge was underpinned by stable operational output and a nearly one-third increase in average realized prices during the period. While iron ore remains a vital cash cow for the firm, its "quiet" performance during the half-year reflects a maturing market and fluctuating demand from Chinese steel mills, further emphasizing the necessity of BHP's diversification into base metals.
Management’s focus on commodities critical to decarbonization and the expansion of AI data centers—both of which are highly copper-intensive—appears to be paying off. However, some market analysts caution that the mining sector remains sensitive to macroeconomic volatility. While copper's trajectory remains bullish due to supply constraints, BHP faces ongoing challenges, including inflationary pressures on operational costs and the logistical complexities of maintaining production at aging mine sites.
As the global economy recalibrates, BHP’s ability to sustain this momentum will depend on its capacity to bring new high-grade projects online and navigate the shifting geopolitical landscape of commodity trade. For now, the group’s strong balance sheet and record-high valuation suggest that its bet on the "metals of the future" has successfully captured the current market zeitgeist.
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