BHP sticking with spending strategy amid coronavirus shock
LONDON – BHP Group will stick with its capital allocation framework, which assesses the best way to deploy spending across the group, despite the impact of the coronavirus pandemic, CEO Mike Henry said.
Speaking at a virtual presentation at Bank of America, Henry said the framework, introduced in 2016, had “been a game changer” for the company. “It’s helped us to drive high quality returns and growth, so it’s not going anywhere,” he said.
BHP, the world’s largest listed miner, warned in April that spending in the 2021 financial year would be lower than its original guidance of $8 billion due to the coronavirus outbreak.
Henry also said BHP could act on the right M&A opportunity but focus is on organic growth. He said the company is on track to cut spending on overheads by more than $500-million by 2021, relative to last financial year.