BHP Group Ltd (LSE:BHP, ASX:BHP) has lifted its final dividend payout ratio to 60% in a set of annual results that met market expectations, though overall profit and revenue were weaker on lower iron ore and coal prices.
Shares rose 0.5% to A$41.69 in early trading.
The mining giant reported revenue of US$51.3 billion for the 2025 financial year, down 8% on the prior period. Underlying attributable profit after tax dropped 26% to US$10.2 billion from US$13.7 billion in FY24, while attributable profit rose 14% to US$9 billion.
Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) fell 10% to US$26 billion, with underlying earnings per share easing to US$2.02 from US$2.70 a year earlier.
Dividend returns
A final dividend of US60 cents per share will be paid on 25 September, representing a 60% payout ratio. This takes total dividends for FY25 to US$1.10 per share, equal to a 55% payout, compared to US$1.46 in FY24.
Analysts at Citi, led by Paul McTaggart, said EBITDA was 4% above their forecast and in line with consensus. “We expect the higher dividend payout ratio to be taken as a modest positive,” Citi noted. Barrenjoey’s Glyn Lawcock described the result as broadly in line, with dividends exceeding consensus expectations of a 50% payout. Macquarie analysts highlighted an 18% beat in the final dividend, adding: “The re-prioritisation of capital and net debt increase were a key positive; we think this supports higher returns in the future.”
Coal headwinds
BHP reiterated its stance on Queensland coal royalties, warning that it would not commit further investment in its BHP Mitsubishi Alliance (BMA) operations while the state maintains its current regime.
Underlying EBITDA from BMA fell US$1.3 billion year-on-year to US$600 million. The drop was driven by coal prices falling 27% and the divestment of the Blackwater and Daunia mines. BHP noted that some of its lower-margin mines are under review and could face mothballing if prices remain weak.
“With no change to the ongoing negative impacts of extreme royalty rates, we will maintain our existing position of not investing in any further growth at BMA,” the company stated. “We will sustain and optimise our existing operations. However, if low coal prices persist, options to pause lower margin areas of our operational footprint will be considered.”
Portfolio changes
In a separate development, BHP has sold its Brazilian gold and copper assets to Corex for US$465 million (A$715 million), according to local outlet Valor Economico. The assets were acquired through BHP’s purchase of OZ Minerals in 2023.