Page 98 - Annual Report 2020

1.10.2 Financial results

The following table expands on the Consolidated Income Statement in section 5.1.1, to provide more information on the revenue and expenses
of the Group in FY2020.
2020 2019 2018
Year ended 30 June US$M US$M US$M
Continuing operations
Revenue (1) 42,931 44,288 43,129
Other income 777 393 247
Employee benefits expense (4,055) (4,032) (3,990)
Changes in inventories of finished goods and work in progress 326 (496) 142
Raw materials and consumables used (5,509) (4,591) (4,389)
Freight and transportation (1,981) (2,378) (2,294)
External services (4,404) (4,745) (4,786)
Third party commodity purchases (1,139) (1,069) (1,374)
Net foreign exchange gains/(losses) 603 147 93
Fair value of derivatives (422) (8) (208)
Government royalties paid and payable (2,362) (2,538) (2,168)
Exploration and evaluation expenditure incurred and expensed in the current period (517) (516) (641)
Depreciation and amortisation expense (6,112) (5,829) (6,288)
Impairment of assets (494) (264) (333)
Lease costs (675) (405) (421)
All other operating expenses (2,034) (1,298) (870)
Expenses excluding net finance costs (28,775) (28,022) (27,527)
(Loss)/profit from equity accounted investments, related impairments and expenses (512) (546) 147
Profit from operations 14,421 16,113 15,996
Net finance costs (911) (1,064) (1,245)
Total taxation expense (4,774) (5,529) (7,007)
Profit after taxation from Continuing operations 8,736 9,520 7,744
Discontinued operations
Loss after taxation from Discontinued operations − (335) (2,921)
Profit after taxation from Continuing and Discontinued operations 8,736 9,185 4,823
Attributable to non-controlling interests 780 879 1,118
Attributable to BHP shareholders 7,956 8,306 3,705
(1) Includes the sale of third party products.
Profit after taxation attributable to BHP shareholders decreased driven by Cerro Colorado operations reflecting current mine plan.
from a profit of US$8.3 billion in FY2019 to a profit of US$8.0 billion Other operating expenses increased by US$736 million driven
in FY2020. by an increase in depletion of production stripping mainly at
Revenue of US$42.9 billion decreased by US$1.4 billion, or Escondida due to increased fine copper movement combined
with closure provision adjustment for closed mines. Favourable
3 per cent, from FY2019. This decrease was primarily attributable
to lower average realised prices for coal, petroleum and copper, movements in foreign exchange (FX) affected the majority
of cost categories.
and lower volumes due to natural field decline at Petroleum and
lower grade at Escondida and Spence, combined with planned (Loss)/profit from equity accounted investments, related
maintenance across a number of our assets. This was partially impairments and expenses of US$(512) million in FY2020
offset by higher average realised prices for iron ore, record decreased by US$34 million from FY2019. The decrease reflects
production at WAIO, record average concentrator throughput at lower profits from Antamina and Cerrejón which was primarily due
Escondida and improved operational stability. to lower prices and COVID-19-related outages offset by favourable
FX movements on the Samarco dam failure provision.
For information on our average realised prices and
production of our commodities, refer to section 1.11. Net finance costs of US$911 million decreased by US$153 million,
or 14 per cent, from FY2019 mainly due to lower effective interest
Total expenses of US$28.8 billion increased by US$0.8 billion, rates and lower average debt balance following the repayment on
or 3 per cent, from FY2019. The decrease in changes in inventories maturity of Group debt.
of finished goods and work in progress of US$822 million was For more information on net finance costs, refer
primarily driven by FY2019 inventory drawdowns at Escondida to section 1.10.3 and note 21 ‘Net finance costs’
in line with the Los Colorados Extension commissioning compared in section 5.
to planned rebuilds for operational stability following drawdowns
in the prior year. Raw materials and consumables used increased Total taxation expense of US$4,774 million reduced by
by US$918 million driven by the cancellation of power contracts US$755 million from FY2019. The decrease was primarily due to
at Escondida and Spence as part of the shift towards 100 per cent lower profits combined with FY2019 impacted by provisions for tax
renewable energy supply contracts. Freight and transportation disputes and a higher net reduction in US tax credits related to
decreased by US$397 million driven by the adoption of IFRS 16 Chilean taxes.
where freight costs related to continuous voyage charters were For more information on income tax expense,
brought onto the balance sheet as right-of-use assets and refer to note 6 ‘Income tax expense’ in section 5.
depreciated. Depreciation and amortisation expense increased
by US$283 million driven by the adoption of IFRS 16 right-of-use
assets partially offset by lower depreciation and amortisation at
Petroleum in line with lower production volumes due to natural
field decline. Impairment of assets increased by US$230 million

96 BHP Annual Report 2020