Resources group says proceeds from the bonds will be used for general corporate purposes
19 February 2025 - 08:43
by Jacqueline Mackenzie
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Resources group BHP has successfully priced $3bn of senior unsecured bonds in the US market.
The group said in a statement on Wednesday that it intended to use the proceeds from the bonds for general corporate purposes.
The offer consists of three tranches of bonds — $1bn five-year bonds priced at a fixed coupon of 5.000% maturing in 2030, $750m seven-year bonds priced at a fixed coupon of 5.125% maturing in 2032 and $1.25bn 10-year bonds priced at a fixed coupon of 5.300% maturing in 2035.
Settlement of the bonds is expected to occur on February 21.
On Tuesday the group reported a 23% decline in profit for the first half as an increase in copper, iron ore and steelmaking coal sales was offset by low iron ore and steelmaking coal prices.
The company delivered an improved operational performance, with copper production increasing by 10% year on year in the six months to end-December.
The increase in copper output, combined with higher copper prices, saw the metal making up a greater proportion of BHP’s earnings. Copper’s share of underlying earnings before interest, tax, depreciation and amortisation (ebitda) grew from 25% to 39%.
However, underlying attributable profit was down 23% at $5.1bn, with revenue in the six months to end-December $2bn lower than in the second half of 2023, primarily driven by a decline in iron ore and steelmaking coal prices.
The profit slump prompted BHP to cut its interim dividend to 50 US cents per share, down from 72c in the previous comparable period.
Last year BHP walked away from its $49bn plan to take over rival Anglo American, which rejected a last-ditch request for more time, ending a six-week pursuit.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
BHP raises $3bn through US bond offer
Resources group says proceeds from the bonds will be used for general corporate purposes
Resources group BHP has successfully priced $3bn of senior unsecured bonds in the US market.
The group said in a statement on Wednesday that it intended to use the proceeds from the bonds for general corporate purposes.
The offer consists of three tranches of bonds — $1bn five-year bonds priced at a fixed coupon of 5.000% maturing in 2030, $750m seven-year bonds priced at a fixed coupon of 5.125% maturing in 2032 and $1.25bn 10-year bonds priced at a fixed coupon of 5.300% maturing in 2035.
Settlement of the bonds is expected to occur on February 21.
On Tuesday the group reported a 23% decline in profit for the first half as an increase in copper, iron ore and steelmaking coal sales was offset by low iron ore and steelmaking coal prices.
The company delivered an improved operational performance, with copper production increasing by 10% year on year in the six months to end-December.
The increase in copper output, combined with higher copper prices, saw the metal making up a greater proportion of BHP’s earnings. Copper’s share of underlying earnings before interest, tax, depreciation and amortisation (ebitda) grew from 25% to 39%.
However, underlying attributable profit was down 23% at $5.1bn, with revenue in the six months to end-December $2bn lower than in the second half of 2023, primarily driven by a decline in iron ore and steelmaking coal prices.
The profit slump prompted BHP to cut its interim dividend to 50 US cents per share, down from 72c in the previous comparable period.
Last year BHP walked away from its $49bn plan to take over rival Anglo American, which rejected a last-ditch request for more time, ending a six-week pursuit.
With Jacob Webster
mackenziej@arena.africa
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Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.