The BHP Group Ltd (ASX: BHP) share price is heading higher on Tuesday.
In morning trade, the mining giant's shares are up 2.5% to $41.93.
This follows the release of the Big Australian's eagerly anticipated FY 2024 results today.
BHP share price higher on results day
It seems the market has been pleased with what the miner reported for the 12 months ended 30 June.
As we covered here, BHP posted a 3% increase in revenue to US$55.7 billion for FY 2024 thanks to its iron ore and copper operations. They both delivered higher volumes and average realised prices compared to a year earlier.
BHP achieved record production at WAIO, Spence and Carrapateena and the highest production in four years at Escondida.
In respect to the WAIO operation, management notes that it extended its lead as the lowest cost major iron ore producer in the world. Copper production increased 9% for the second consecutive year and is expected to increase a further 4% in FY 2025.
The above helped to offset lower energy coal and nickel prices and softer coal volumes.
And with BHP managing to keep its costs under control despite inflationary pressures, its underlying EBITDA margin remained at 54% and its underlying EBITDA increased 4% year on year to US$29 billion.
While this didn't stop the BHP board from cutting its fully franked dividend by 14.1% to US$1.46 per share, this dividend was in line with consensus estimates for the year.
Based on the current BHP share price and the latest exchange rates, this US$7.4 billion payout equates to an attractive 5.15% dividend yield.
What are analysts saying?
Saxo Asia Pacific's senior sales trader, Junvum Kim, was pleased with the result and described it as "robust". Kim said:
BHP's FY24 results show robust performance, with record iron ore volumes and a 9% rise in copper production. The USD 0.74 per share dividend underscores solid returns. Key growth drivers include copper expansions and the ahead-of-schedule Jansen potash project, with BHP's strong balance sheet and strategic initiatives positioning the company well for sustained growth.
What's next?
BHP's CEO, Mike Henry, was cautiously optimistic on the company's outlook. He said:
The longer-term fundamentals that drive demand for our products remain compelling. In the near term, we expect volatility in global commodity markets, with China experiencing an uneven recovery among its end-use sectors. The effectiveness of recently announced pro-growth policies will be an important contributor for the country to achieve its official 5% growth target. India is set to continue as the world's fastest growing major economy. We anticipate developed economies will face gradual relief from the lingering effects of higher interest rates in coming years.
Henry also spoke highly about BHP's copper production potential. He adds:
We have a pipeline of copper projects under development in Chile and Australia. At Copper SA we have a strategy to deliver up to 650 ktpa of copper and today we published an Inferred Mineral Resource at Oak Dam for the first time. In July, we strengthened our copper resource position and our early-stage options by agreeing to acquire a 50% interest in the promising Filo del Sol and Josemaria copper projects in Argentina, adding to Resolution in the US and our greenfield exploration efforts.
Overall, this was a solid result and the market is unsurprisingly responding positively to it.
