BHP chief executive Andrew Mackenzie has claimed that businesses are navigating “global volatility” in a thinly veiled reference to escalating trade tensions between the United States and China.
Mackenzie was speaking at BHP’s annual general meeting (AGM) in London last night when he made the claims.
While not mentioning the two countries by name, he claimed that the “current assault on the global trading system will jolt countries outside of this dispute into action”, in reference to the growing trade tariffs between the US and China that have been largely escalated by US President Donald Trump.
Mackenzie mentioned that protectionism had a negative flow-on effect for businesses by undercutting confidence, disrupting investment and destroying productivity.
“This is not a time for complacency,” Mackenzie said. “When the fabric of global trade frays, we must pull together and administer needle and thread.”
Mackenzie, however, added that BHP’s business had not been “significantly impacted” by current events.
The company also reiterated its commitment to safety, having seen two work-related deaths in the past year. BHP chairman Ken MacKenzie offered his “heartfelt condolences” to their families and friends in his speech.
Other aspects of the AGM focused on BHP’s continual process of streamlining its business to increase agility in a changing marketplace. This includes the sale of BHP’s onshore US gas assets for $US10.8 billion ($14.2 billion) that was announced earlier this year.
“This is an important milestone,” said chairman Ken MacKenzie, who also gave a speech at the AGM. “These transactions are expected to complete later this month and we expect to return the net proceeds to shareholders by the end of the year, or early in calendar year 2019.”
Despite the upcoming sale of its shale assets, BHP reiterated its commitment to petroleum, with Ken MacKenzie calling it an “important part of our portfolio”.
BHP yesterday announced in its third quarter operational report that it would be reducing its copper guidance for the 2019 financial year by 3 per cent due to impacts from outages at the Olympic Dam mine in South Australia and Spence operation in Chile.
The company’s other assets are stable or on the up, however, including iron ore which has seen a 3 per cent dip in the quarter but a 10 per cent rise over the last year.
“In conclusion, [the 2018 financial year] was a good year, and we are on course to make further progress in 2019,”said Ken MacKenzie in his closing address to shareholders. “We will do this through an unrelenting focus on making [BHP] even simpler, stronger, more efficient and more disciplined.”