Happy Chinese New Year!

 

 

Friends from the Bay did a lot of horsing around aboard the ESCAPADE, as she came sailing past "Riverbend" while they celebrated the Chinese New Year, the Year of the Horse.

 

Watch out! Any closer and you might hit our jetty!

 

They waved and shouted and Padma waved back, while I continued to watch the evening news which was more of the same, but strangely, for once no mad mutterings from the Mad Donald tonight. What's going on?

 

 

Happy Chinese New Year!

 

Googlemap Riverbend

 

What a view! What a find!

 

View from Holmes Lookout towards Batemans Bay

 

We made an early start to meet the other Batemans Bay Bushwalkers at Holmes Lookout for the long walk down to Chinamans Point and back. We waited for an hour before I thought that something must be amiss and checked the date - we were one whole day early! The walk is not until tomorrow!

Being already halfway to Batemans Bay we kept going, and Padma did her usual grocery shopping which meant she stocked up on everything as if there was going to be an outbreak of some sort of virulent disease and all the shops were going to be shut for the next three months, while I sniffed around the bookshelves in the Vinnies and the Salvos op-shop.

 

 

I was lucky to find this wonderful little hardcover book, "The Aitch Factor" written by the Macquarie Dictionary editor Susan Butler, who's a woman after my own heart because she cares about the 's plurals. As she writes, "I would recommend losing the apostrophe completely rather than give in to the 's plurals". I am with you, Susan! What a find!

Never mind that we spent an hour at Holmes Lookout; never mind that I wasn't at my computer when BHP hit $54.20. This little book for all the word warriors, punctuation pedants and everyday-lovers of language out there makes up for all the time we lost and all the money I lost.

 

Googlemap Riverbend

 

From the desk of BHP Chief Executive Officer, Mike Henry

 

For the full half-year-results presentation, click here

 

We continue to prosecute our strategy of operational excellence, distinctive social value creation and growth in copper and potash. We have achieved ~30% growth in copper production in the last four years, positioning us ahead of the strengthening copper market that we had anticipated.

This half marks a milestone for BHP with Copper contributing the largest share of our overall earnings, at 51% of Underlying EBITDA.

BHP is the world’s largest copper producer and with strong performance at Escondida, and solid contributions from our other operations in Chile and South Australia, we have increased FY26 group copper guidance to 1.9 – 2.0 Mt. This is allowing us to maximise increased earnings from the recent run up in copper prices as well as gold.

With four compelling growth options across Chile, Argentina, Arizona and South Australia, we are well positioned to capture the forecast higher long term copper prices. We expect first production and revenue from the Jansen Stage 1 potash project in mid-CY27. Following completion of our definitive updated cost estimate, at our recent Operational Review we announced an increase in Jansen Stage 1 project expenditure to US$8.4 bn.

Our Western Australia iron ore business continues to deliver for shareholders. WAIO achieved record first half production and shipments and we further strengthened our position as the world’s lowest cost major iron ore producer. We continue to invest in this business. We are adding a sixth rail car dumper at Port Hedland so trains can unload faster, supporting an uplift in sustainable volumes to >305 Mt.

At a Group level, we again delivered a safe, reliable half, with resilient margins and cash flows that support disciplined investment and strong shareholder returns.

Underlying EBITDA increased 25% to US$15.5 bn with an Underlying EBITDA margin of 58%. Underlying Attributable profit also increased by more than 20% to US$6.2 bn. Underlying ROCE increased by around 3 percentage points to circa 24%.

Consistently strong cash generation and balance sheet strength remain hallmarks of BHP. We generated US$9.4 bn in operating cash and finished the half with net debt of US$14.7 bn, comfortably around the midpoint of our US$10–20 bn target range.

We determined an interim dividend of US 73 cents per share, equivalent to a 60% payout ratio, reflecting strong operating performance, disciplined capital allocation and confidence in our outlook.

Today, we announced the most valuable silver streaming agreement ever relating to our share of Antamina’s future silver production, which follows the agreement in December relating to our share of WAIO’s inland power consumption. These are examples of our active approach to capital portfolio and asset management, improving our financial flexibility and unlocking value. Together, these agreements will unlock over US$6 bn of cash. We see the potential to unlock up to a total of US$10 bn.

Looking ahead we expect circa 3% global economic growth in CY26. China’s economy is resilient after meeting its around 5% target last year. India continues to outperform. We are optimistic that the economic backdrop is supportive for our key commodities. Against a structurally higher cost environment, these conditions reinforce the importance of productivity and cost discipline and play to the strengths of BHP’s low cost, diversified portfolio.

Our growth pipeline sets BHP apart, both from expansion of our existing Tier 1 assets and exciting greenfield projects like Jansen, Vicuña and Resolution, and will allow us to deliver resilient returns through the cycle"

For more, click here.

 

I had placed a sell-order at $53.99 with Commsec before I left home this morning, not quite expecting that BHP's shares would go that high.

They got sold straight out of the box, and then the shares continued to go as high as $54.20. At time of writing, they trade around $53.95, after having briefly dipped to $52.90 (when I should've bought back in again but I wasn't at my computer at the time but shopping at Vinnies).

Anyway, I placed another forward-sell-order at $54.20 which may or may not sell. I don't care, as the rest of my holding will collect the fully-franked dividends of US$0.73, or AUS$1.03 at current conversion rates.

 

Googlemap Riverbend

 

P.S. I had my afternoon nap in "Bonniedoon" and the market is closed, with BHP ending the day 4.73%, or $2.38, higher at $52.74.

 

On books and reading

 

 

I wish that in my youth I had had someone of good sense and taste to direct my reading. I dispair when I reflect on the amount of time I have wasted on books that were of no value to me. The value of reading is in its effect on character and its use for life.

When I lived in Port Moresby I had a friend from my Bougainville days who had also taken a job in town and lived in a company-supplied flat just out of town at Six-Mile. (I am telling you all this not because I think you are in any way interested in all this detail, but because it starts to fill out this post rather nicely.) Anyway, this chap - let's call him Brian, because that was his name - furnished his flat, which was empty to start with except for the bare essentials, with all the things left behind by other employees who had 'gone pinis' after their time in New Guinea.

This habit not only resulted in him eating from an ill-matched set of crockery with a fork which had one tine missing, but also dictated what he read. From the schmalziest Mills & Boon romance novel to the most extraterrestrial science fiction nonsense, Brian had read them all, simply because they'd been left behind by those departed employees.

My own reading habit is a little more discerning although still restricted by what's available in the local op-shops - one in Moruya, two in the Bay, and altogether three in Ulladulla - since every 'real' bookshop that ever opened its doors has shut them again within a few years, if not months.

The 'bookshops' inside those op-shops seem more real, at least to me, than the 'real' bookshops since they needn't cater to the popular taste but reflect what was read previously by people who must've kept them because they thought them of value, until divorce, death, or whatever other human tragedy befell them, forced their surrender to an op-shop (in fact, their antecedents, as evidenced by an Ex Libris sticker, a loving dedication written on the flyleaf, a hastily pencilled notation in the margin, or an airline boarding pass used as a bookmark, even one of those horrible folded-down dog-ears pointing to an important page, add to the charm of a second-hand book, and are often a story all in itself).

Usually costing no more than a gold coin, it is easy to buy more of these second-hand books than I would do if I still had to pay full retail price, which means the floor beside my armchair often looks like the photo above, which I took after Padma had restacked them by size while I had briefly gone outside to take in the sunshine. So which one had I been reading before I went outside? Was it a small, medium, or large one?

 

Googlemap Riverbend

 

Otterly delightful

 

 

I've just returned from another long afternoon at "Bonniedoon", happy and relaxed, and what better way to finish off the day than by watching the story of Gavin Maxwell's otter. I shall never tire of watching it again and again and again as it is so otterly delightful.

 

 

Gavin Maxwell's fireplace at Camusfearna is inscribed with the Latin words 'NON FATUUM HUC PERSECUTUS IGNEM' which, according to GOOGLE, means, "It is no will-o'-the-wisp that I have followed here".

What a thoughtful and deeply meaningful inscription. If "Bonniedoon" had a fireplace (now there's an idea for the next winter!) I'd borrow it.

 

Googlemap Riverbend