2000/01 Financial Results
BHP Billiton Limited
3 September 2001
3 September 2001
BHP BILLITON LIMITED GROUP
APPENDIX 4B DISCLOSURES
The following document contains the balance of the BHP Billiton Limited Group
Appendix 4B disclosures to the Australian Stock Exchange (ASX) for the year
ended 30 June 2001.
This document should be read in conjunction with the preliminary results for
the BHP Billiton Limited Group released to the ASX on 20 August 2001.
Karen J Wood
Company Secretary
BHP Billiton Limited Group
2000/2001 FINANCIAL RESULTS
3 September 2001
The following additional information is provided in relation to the results for
the year ended 30 June 2001.
Statement of Financial Performance 30 June 30 June
for the financial period ended 2001 2000 (1)
$m $m
Revenue from ordinary activities
Sales 20 698 21 506
Interest revenue 110 96
Other revenue 1 671 2 051
22 479 23 653
deduct
Expenses from ordinary activities, excluding 16 978 18 958
depreciation, amortisation and borrowing costs
Depreciation and amortisation 2 402 2 292
Borrowing costs 553 723
2 546 1 680
Share of net profit of associated entities 29 30
accounted for using the equity method
2 575 1 710
deduct
Income tax expense attributable to ordinary 1 066 117
activities
Net profit 1 509 1 593
add
Outside equity interests in net profit 498 34
Net profit attributable to members of BHP 2 007 1 627
Billiton Limited .
Adjustment for initial adoption of revised 250
accounting standard
AASB 1016: Accounting for Investments in
Associates
Net exchange fluctuations on translation of 636 173
foreign currency net assets and foreign
currency interest bearing liabilities net of
tax
Total direct adjustments to equity 636 423
attributable to members of BHP
Billiton Limited
Total changes in equity other than those 2 643 2 050
resulting from transactions with owners
1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15.
Statement of Financial Position
as at
30 June 30 June
2001 2000
Assets $m $m
Current assets
Cash assets 1 183 1 039
Receivables 2 615 2629
Other financial assets 163 4
Inventories 1 621 2138
Other assets 219 271
Total current assets 5 801 6081
Non-current assets
Receivables 228 189
Investments accounted for using the equity 498 632
method
Other financial assets 257 499
Inventories 146 159
Property, plant and equipment 20 014 19 586
Intangible assets 2 130
Deferred tax assets 906 1 268
Other assets 1 335 800
Total non-current assets 23 386 23263
Total assets 29 187 29344
Liabilities
Current liabilities
Payables 2 813 2566
Interest bearing liabilities 973 2 530
Tax liabilities 217 192
Other provisions 1 608 1535
Total current liabilities 5 611 6823
Non-current liabilities
Payables 34 45
Interest bearing liabilities 6 257 5868
Deferred tax liabilities 1 844 1 896
Other provisions 4 193 3 707
Total non-current liabilities 12 328 11516
Total liabilities 17 939 18339
Net assets 11 248 11005
Equity
Equity attributable to members of BHP Billiton
Limited
Contributed equity 6 013 7093
Reserves 1 061 419
Retained profits 3 930 2841
11 004 10353
Equity attributable to outside equity interests 244 652
Total equity 11 248 11005
Statement of Cash Flows
for the financial period ended
30 June 30 June
2001 2000 (1)
$m $m
Cash flows related to operating activities
Receipts from customers 21 114 20959
Payments to suppliers, employees, etc (14 821) (16210)
Dividends received 81 46
Interest received 117 91
Borrowing costs (650) (916)
HBI Venezuela guarantee payment (615)
Proceeds from gas sales contract price - 231
re-negotiation
Other 388 337
Operating cash flows before income tax 5 614 4538
Income taxes paid (609) (600)
Net operating cash flows 5 005 3938
Cash flows related to investing activities
Purchases of property, plant and equipment (1 966) (1102)
Exploration expenditure (518) (373)
Purchases of investments (686) (438)
Purchases of, or increased investment in, (704) -
controlled entities and joint venture interests net
of their cash
Investing outflows (3 874) (1913)
Proceeds from sale of property, plant and equipment 163 741
Proceeds from sale or redemption of investments 456 242
Proceeds from OneSteel spin-out 660
Proceeds from sale or partial sale of controlled
entities
and joint venture interests net of their cash 407 698
Net investing cash flows (2 188) (232)
Cash flows related to financing activities
Proceeds from ordinary share issues, etc 142 275
Proceeds from interest bearing liabilities 769 1658
Repayment of interest bearing liabilities (2 683) (4867)
Dividends paid (926) (498)
Other - 82
Net financing cash flows (2 698) (3350)
Net increase in cash and cash equivalents 119 356
Cash and cash equivalents at beginning of period 937 573
Effect of foreign currency exchange rate changes on cash 55 8
and cash equivalents
Cash and cash equivalents at end of period 1 111 937
(1) 30 June 2000 refers to the thirteen months ended 30
June 2000. Refer 'Change of financial year' on page 15
Statement of Cash Flows (continued)
30 June 30 June
2001 2000 (1)
Reconciliation of cash $m $m
Cash and cash equivalents comprise:
Cash 581 684
Short term deposits 602 355
Cash assets 1 183 1 039
Bank overdrafts (72) (102)
Total cash and cash equivalents 1 111 937
Non-cash financing and investing activities
Shares issued:
Bonus Share Plan - 61
Dividend Investment Plan 1 341
Other:
Employee Share Plan loan instalments 20 28
The Bonus Share Plan (BSP) is in lieu of dividends and the Dividend
Investment Plan (DIP) is an application of dividends. The DIP was suspended
following payment of the November 1999 half yearly dividend. Since that
dividend was unfranked the BSP was suspended in accordance with BHP Billiton
Limited's Constitution and Rule 8 of the BSP on 17 September 1999.
The Employee Share Plan loan instalments represent the repayment of loans
outstanding with the BHP Billiton Limited Group, by the application of
dividends.
Control gained over entities having material effect
There were no acquisitions during the year having a material effect on
profit.
(1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15
Loss of control of entities having material effect
The following entities formed part of the OneSteel Limited Group that was
spun-out with effect from 31 October 2000:
A J Forsyth & Co Ltd OneSteel Limited (a)
Aquila Steel Company Pty Ltd OneSteel Finance Pty Limited (b)
Australian Wire Industries Pty Ltd OneSteel Investments Pty Limited (a)
AWI Holdings Pty Ltd OneSteel Manufacturing Pty Limited
Corumba Pty Ltd OneSteel NSW Pty Limited
CP Reinforcing Ltd OneSteel Queensland Pty Limited
CP Steel Ltd OneSteel Reinforcing Pty Limited
David Crozier Ltd OneSteel Wire Pty Limited
EMCO Group Ltd Reosteel Pty Ltd
Fastening Supplies Ltd Steel & Tube Holdings Ltd
J Murray-More (Holdings) Pty Ltd Steel & Tube New Zealand Ltd
John Stansfield-Smith Pty Ltd Stewart Steel Ltd
Longrun Industries Ltd Stube Industries Ltd
Macinery Ltd Tubemakers of Australia Ltd
Metal Sales Ltd Tubemakers of New Zealand Ltd
Metpol Pty Ltd Tubemakers Properties Pty Ltd
NZMC Ltd Tubemakers Somerton Pty Ltd
(a) The names of these entities were changed in 2001. OneSteel Limited
was previously OneSteel Pty Limited and OneSteel Investment Pty Limited was
previously Votraint No 1243 Pty Ltd.
(b) This entity was incorporated/formed in 2001.
The OneSteel Limited Group contributed $35 million to the BHP Billiton
Limited Group net profit during the current period until the effective
spin-out date. Contribution to the BHP Billiton Limited Group net profit
during the previous twelve month period was $124 million.
There was no net profit recognised by the BHP Billiton Limited Group on
spin-out of these entities, other than one-off benefits of approximately $29
million previously treated on consolidation as intercompany profits within
the BHP Billiton Limited Group.
Franking credits
The BHP Billiton Limited Group had a franking account balance of $225 million
at 34 cents in the dollar available at 30 June 2001 before the 2 July 2001
dividend payment. An amount of $466 million at 30 cents in the dollar was
used as a result of the 2 July 2001 dividend payment. (The BHP Billiton
Limited Group had a franking account balance of $24 million at 36 cents in
the dollar available at 30 June 2000). It is anticipated that dividends
payable in the following year will be fully franked.
Retained profits
30 June 30 June
2001 2000 (1)
$m $m
Retained profits at the beginning of the period 2 841 1 826
Adjustment for initial adoption of revised
accounting standard AASB1016: Accounting for 250
Investments in Associates
Dividends provided for or paid (912) (903)
Aggregate of amounts transferred from reserves (6) 41
Net profit 2 007 1 627
Retained profits at the end of the financial period 3 930 2 841
1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15.
Income tax
30 June 30 June
2001 2000 (1)
$m $m
Income tax expense
Profit from ordinary activities before 2 575 1 710
income tax
Prima facie tax calculated at 34 cents 876 616
(2000: 36 cents) in the dollar on profit
from ordinary activities
deduct/(add) tax effect of
Investment and development allowance 39 56
Rebate for dividends 6 2
Amounts over provided in prior years 50 103
Deferred tax restatement 16 166
Non-tax effected gains/(losses) 14 (28)
Non-tax effected capital gains 140 22
Recognition of prior year tax losses 266 187
Overseas tax rate changes 31 -
Research and development incentive 3 1
311 107
add/(deduct) tax effect of
Non-deductible accounting depreciation 32 60
and amortisation
Non-deductible dividends on redeemable preference shares 51 67
Tax differential - non Australian income 52 (12)
Foreign expenditure including 107 66
exploration not presently deductible
Investment and asset write-offs and 321 (236)
associated losses/(gains)
Non-deductible financing costs 63 -
Foreign exchange/other 129 65
Income tax attributable to profit from 1 066 117
ordinary activities
deduct Income tax benefit arising from 142 56
items taken to exchange fluctuation account
Total income tax taken to account 924 61
1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15
Exploration, evaluation and development expenditure capitalised
30 June 30 June
2001 2000 (1)
$m $m
Exploration, evaluation and development expenditure - 1 179 598
not yet in production
- in production 1 315 1 421
Total exploration, evaluation and development expenditure 2 494 2 019
capitalised
Details of exploration, evaluation and
.development expenditure notyet in production:
In exploration and/or In development stage
evaluation stage
30 June 30 June 30 June 30 June
2001 2000 (1) 2001 2000 (1)
$m $m $m $m
Opening balance 375 486 223 130
Expenditure 522 373 475 43
incurred during
the period
Expenditure (427) (309) - -
expensed during
the period
Transferred from (10) (146) 10 146
evaluation to
development
Transferred to (5) 9 (27) (92)
production
Disposals - (46) - -
Depreciation (60) (13) (5) (4)
Exchange 63 21 45 -
fluctuations and
other movements
Closing balance 458 375 721 223
* (1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15.
Depreciation and amortisation
30 June 2001 30 June
2000 (1)
$m $m
Depreciation relates to
Buildings 141 132
Plant, machinery and equipment 1 948 1857
Mineral rights 52 69
Exploration, evaluation and development 252 213
expenditure
Capitalised leased assets 4 4
Total depreciation 2 397 2275
Amortisation (a)(b) 5 17
Total depreciation and amortisation 2 402 2292
2001
$m
Before tax Related Related Amount
Tax outside (after tax)
equity attributable
interests to members
of BHP
Billiton
Limited
(a) Amortisation
relates to
Amortisation of goodwill 5 - - 5
Amortisation of other intangibles - - - -
Total amortisation 5 - - 5
2001 2000 (1)
$m $m
(b) Profit from ordinary activities restated to
exclude amortisation of goodwill
Net profit before outside equity interests 1 509 1593
add amortisation of goodwill 5 16
Net profit before outside equity interests and 1 514 1609
amortisation of goodwill
add outside equity interests 498 34
Net profit (before amortisation of goodwill) 2 012 1643
attributable to members of BHP Billiton Limited
(1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15.
Segment results
Industry classification
$m
Net Gross External Intersegment
profit segment revenue from revenue from
(a) assets ordinary ordinary
activities activities
Industry classification 2001
Minerals 624 13 403 10 159 332
Petroleum 1 916 8 137 6 354 41
Steel (b) 323 5 223 6 054 618
Net unallocated interest (343) 93
Group and
unallocated items (c) (1 011) 2 424 (181) 85
BHP Billiton 1 509 29 187 22 479 1 076
Limited Group
$m
Net Gross External Intersegment
profit segment revenue from revenue from
(a) assets ordinary ordinary
activities activities
Industry 2000 (1)
classification
Minerals 480 11 917 8 830 365
Petroleum 1 319 7 409 5 625 14
Steel (b) 310 7 937 9 081 517
Services (d) 99 7 279 213
Net unallocated (515) 65
interest
Group and (100) 2 074 (227) 9
unallocated items (c)
BHP Billiton 1 593 29 344 23 653 1 118
Limited Group
(a) Net profit is before deducting outside equity interests.
(b) Includes the OneSteel Limited business, which was spun-out in October
2000.
(c) Includes consolidation adjustments
(d) Following various asset sales and an internal reorganisation, the
Services segment ceased to exist from
1 July 2000. As a consequence, Transport and Logistics is reported in the
Steel segment and remaining services businesses including Shared Business
Services, Insurances and Corporate Services are reported in Group and
unallocated items. Comparative data has been adjusted accordingly. 2000 data
for Services mainly relates to businesses now sold
1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15
Segment results
Geographical classification
$m
Net Gross External Intersegment
profit segment revenue from revenue from
(a) assets ordinary ordinary
activities activities
Geographical classification 2001
Australia 1 958 14 982 14 988 276
North America 224 4 460 1 840 -
United 289 2 364 1 120 -
Kingdom
South America (25) 4 865 2 021 -
Papua New Guinea (778) 322 952 -
New Zealand 77 607 534 -
South East Asia 70 931 702 -
Other countries 37 656 229 -
1 852 29 187 22 386 276
Net unallocated (343) 93
interest
BHP Billiton 1 509 29 187 22 479 276
Limited Group
$m
Net Gross External Intersegment
profit segment revenue from revenue from
(a) assets ordinary ordinary
activities activities
Geographical classification 2000 (1)
Australia 1 143 17 358 14 573 263
North America 73 2 531 3 299 -
United 226 2 225 968 -
Kingdom
South America 458 4 150 1 956 1
Papua New Guinea 71 979 1 161 -
New Zealand 59 602 682 -
South East Asia 22 1 030 704 -
Other countries 56 469 245 -
2 108 29 344 23 588 264
Net unallocated (515) 65
interest
BHP Billiton 1 593 29 344 23 653 264
Limited Group
1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15
(a) Net profit is before deducting outside equity interests.
Contributed equity at end of financial period
Paid-up
Number Of which value
on issue quoted cents (a)
Ordinary shares:
Fully paid 3 704 256 885 3 704 256 885
Partly paid 3 656 500 3 656 500 67
Partly paid 385 000 385 000 71
of which issued during
period:
ESP Options exercised 7 798 200 7 798 200
Performance Rights 150 920 150 920
exercised
Bonus shares issued (b) 1 912 154 524 1 912 154 524
Partly paid shares 2 660 000 2 660 000
converted to fully
paid
BHP Special Voting Share (c) 1 -
(a) Unless otherwise indicated shares are fully paid.
(b) The Dual Listed Company (DLC) structure between BHP Billiton Limited
and BHP Billiton Plc was established on 29 June 2001. Under the terms of the
DLC structure BHP Billiton Limited issued fully paid bonus shares effective
29 June 2001 with the allotment of shares occurring on 9 July 2001.
(c) Issued during the current year.
Options and Performance Rights
Month of Number Number Number Shares Number Options and
issue issued of exercised issued lapsed Performance
recipients on Rights
exercise outstanding
at balance
date
Employee Share Plan options
December 2000 1,668,000 67 - - - 1,668,000
December 2000 1,121,500 59 - - - 1,121,500
November 2000 832,500 44 - - 54,000 778,500
November 2000 3,760,000 197 - - 23,500 3,736,500
April 2000 30,000 3 - - - 30,000
April 2000 454,000 5 - - - 454,000
December 1999 200,000 1 - - - 200,000
December 1999 150,000 1 - - - 150,000
October 1999 60,000 6 - - 10,000 50,000
October 1999 51,000 3 - - 15,000 36,000
July 1999 100,000 1 - - - 100,000
April 1999 21,536,400 45,595 - - 8,926,100 12,610,300
April 1999 8,184,300 944 - - 2,028,150 6,156,150
April 1998 177,500 16 29,500 29,500 - 148,000
April 1998 140,000 23 42,500 42,500 5,000 92,500
November 1997 1,579,400 3,501 748,800 748,800 210,500 620,100
November 1997 7,910,900 16,411 5,447,150 5,447,150 774,250 1,689,500
October 1997 5,440,000 511 2,059,500 2,059,500 43,000 3,337,500
October 1997 3,992,000 379 1,752,000 1,752,000 120,000 2,120,000
July 1997 200,000 1 - - - 200,000
July 1997 395,500 36 62,500 62,500 55,000 278,000
October 1996 848,100 46 436,500 436,500 191,100 220,500
October 1996 1,086,700 66 733,700 733,700 14,500 338,500
April 1996 295,000 5 35,000 35,000 260,000 -
April 1996 45,500 6 45,500 45,500 - -
October 1995 17,000 3 17,000 17,000 - -
October 1995 38,500 5 38,500 38,500 - -
July 1995 48,000 2 48,000 48,000 - -
July 1995 76,000 9 63,000 63,000 13,000 -
36,135,550
Performance Rights (c) (d)
December 2000 187,691 11 - - - 187,691
November 2000 2,006,333 104 - - - 2,006,333
March 1999 1,000,000 1 400,000 376,840 - 600,000
2,794,024
Options and Performance Rights
Continuation of previous table
Month of Exercise Exercise period
Issue price (b)
Employee Share Plan options
December 2000 $19.43 July 2003 - Dec 2010
December 2000 $19.42 July 2003 - Dec 2010
November 2000 $18.52 July 2003 - Oct 2010
November 2000 $18.51 July 2003 - Oct 2010
April 2000 $17.13 April 2003 - April 2010
April 2000 $17.12 April 2003 - April 2010
December 1999 $19.21 April 2002 - April 2009
December 1999 $16.92 April 2002 - April 2009
October 1999 $17.06 April 2002 - April 2009
October 1999 $17.05 April 2002 - April 2009
July 1999 $17.13 April 2002 - April 2009
April 1999 $15.73 April 2002 - April 2009
April 1999 $15.72 April 2002 - April 2009
April 1998 $14.74 April 2001 - April 2003
April 1998 $14.73 April 2001 - April 2003
November 1997 $15.55 Nov 2000 - Nov 2002
November 1997 $15.56 Nov 2000 - Nov 2002
October 1997 $15.32 Oct 2000 - Oct 2002
October 1997 $15.33 Oct 2000 - Oct 2002
July 1997 $18.96 July 2000 - July 2002
July 1997 $18.97 July 2000 - July 2002
October 1996 $15.56 Oct 1999 - Oct 2001
October 1996 $15.55 Oct 1999 - Oct 2001
April 1996 $17.63 April 1999 - April 2001
April 1996 $17.62 April 1999 - April 2001
October 1995 $18.23 Oct 1998 - Oct 2000
October 1995 $18.22 Oct 1998 - Oct 2000
July 1995 $18.59 July 1998 - July 2000
July 1995 $18.58 July 1998 - July 2000
Performance Rights (c) (d)
December 2000 - July 2003 - Dec 2010
November 2000 - July 2003 - Dec 2010
March 1999 - Mar 1999 - Mar 2009
a) The Dual Listed Companies (DLC) structure between BHP Billiton Limited and
BHP Billiton Plc was established on 29 June 2001. Under the terms of the DLC
structure BHP Billiton Limited issued fully paid bonus shares effective 29
June 2001 with the allotment of shares occurring on 9 July 2001.
(b) Following the OneSteel Limited spin-out the exercise price of options
issued under the Employee Share Plan prior to 31 October 2000 was reduced by
$0.66.
(c) The number of shares received on exercise of Performance Rights issued in
March 1999 have been increased following the OneSteel Limited spin-out to
reflect the capital reduction impact on the value of BHP Billiton Limited
shares.
(d) Shares issued on exercise of Performance Rights include shares purchased on
market.
Investments in associated entities
Details of aggregate share of profits/(losses) of associates
30 June 30 June
2001 2000 (1)
Share of net profit of associated entities $m $m
Profit from ordinary activities before income tax 77 49
Income tax expense (48) (19)
29 30
Material interests in entities which are not controlled entities
Percentage (%) of Contribution to operating
ownership interest held at profit after income tax
end of period
Name of Entity
30 June 30 June 30 June 30 June
2001 2000 (1) 2001 2000 (1)
Equity accounted % % $m $m
associates
Samarco Mineracao S.A. 50 49 80 46
Orinoco Iron C.A. 50 50 (89) (16)
QCT Resources Ltd (a) - - 38 -
Total (b) 29 30
(a) A 50% interest in QCT Resources Ltd was acquired on 20 October 2000
and equity accounted from 1 November 2000 until its disposal on 28 June
2001.
(b) There are no other material interests in entities that are not
controlled entities.
(1) 30 June 2000 refers to the thirteen months ended 30 June 2000. Refer
'Change of financial year' on page 15.
Significant events after balance date
Income tax audit
As a consequence of an income tax audit conducted by the Australian Taxation
Office (ATO), an amount of $229 million has been subject to litigation.
The dispute concerns the deductibility of financing costs paid to General
Electric Company in connection with the BHP Billiton Limited Group's
acquisition of the Utah Group in the early 1980's. On 23 November 1999, the
Federal Court ruled in favour of the BHP Billiton Limited Group. On 18
October 2000, the Full Bench of the Federal Court ruled in favour of the ATO.
The BHP Billiton Limited Group sought leave to appeal to the High Court of
Australia (High Court) and the hearing occurred on 10 August 2001. The High
Court has refused the BHP Billiton Limited Group leave to appeal on the
general question of deductibility but did allow leave to appeal on the
question of whether the ATO had the power to amend the 1985 assessment.
An amount of $79 million was paid in 1992 and up to 2001 was accounted for as
a non-current asset. At 30 June 2001, the accounts have been adjusted to
include a tax expense of $63 million relating to refusal of the High Court to
grant leave to appeal on the deductibility of financing costs. A non-current
asset of $16 million will be carried forward.
In July 2001, the outstanding balance of $150 million was paid. This amount
will also be recorded as a non-current asset in the 2002 fiscal year. This
together with the $16 million carried forward from the 2001 year represents
the tax and interest in dispute in relation to the 1985 assessment.
New Accounting Standards
- Revised Australian Accounting Standard AASB 1041: Revaluation of
Non-Current Assets was first adopted from 1 July 2000 resulting in property
plant and equipment and other financial assets previously carried at valuation
being reverted to a cost basis of measurement. For the purposes of transitioning
to a cost basis, the existing revalued carrying amounts at 1 July 2000 were
deemed to be their cost. The change in policy had no impact on net profit
attributable to members of BHP Billiton Limited.
- Some line items and sub-totals reported in the previous financial year have
been reclassified and repositioned in the financial statements as a result of
the first time application on 1 July 2000 of the revised standards AASB 1018:
Statement of Financial Performance, AASB 1034: Financial Report Presentation
and Disclosures and the new AASB 1040: Statement of Financial Position.
Change in accounting policies
As a consequence of the DLC structure established between BHP Billiton
Limited and BHP Billiton Plc, which became effective on 29 June 2001, certain
accounting policies of the BHP Billiton Limited Group have been changed to
align with the policies of the BHP Billiton Plc Group in order to minimise
differences between results reported in the UK and Australian jurisdictions.
The following revised accounting policies have been adopted for the year
ended 30 June 2001:
Provision for restoration and rehabilitation
In prior periods the BHP Billiton Limited Group had recognised provisions for
restoration on a progressive basis over the life of each asset. At 30 June
2001, this policy was changed such that a provision for the full cost
expected to be incurred at the end of the life of each asset on a discounted
to net present value basis is recognised at the beginning of each project and
capitalised as part of the cost of the asset. The capitalised cost is
amortised over the life of the operation and the annual increase in the net
present value of the provision for the expected cost is included in expenses
from ordinary activities. The effect of this policy change for the year ended
30 June 2001 has been an increase in net profit attributable to members of
BHP Billiton Limited of $55 million.
Pension costs
In prior periods the BHP Billiton Limited Group had recognised an expense for
defined benefit pensions when contributions were paid. At 30 June 2001, this
policy was changed such that expenses for defined benefit pension schemes are
recognised so as to allocate the cost systematically over the employees'
service lives on the basis of independent actuarial advise. A pension
obligation or asset is consequently recognised in the Statement of Financial
Position to the extent that the contributions paid either lag or precede
expense recognition. The effect of this policy change for the year ended 30
June 2001 has been to recognise a net asset representing the fund surplus and
an increase in net profit attributable to members of BHP Billiton Limited of
$265 million.
Employee compensation costs
In prior periods, the BHP Billiton Limited Group included in the Statement of
Financial Performance the cost associated with Performance Rights at the time
they were exercised. Costs associated with the exercise of options were not
included in the Statement of Financial Performance. At 30 June 2001, this
policy was changed such that the estimated cost to the BHP Billiton Limited
Group on exercise of Performance Rights and, where applicable, the cost
associated with the discount on issue of options are included in the
Statement of Financial Performance over the likely vesting period, with a
corresponding provision for employee benefits being included in the Statement
of Financial Position. At the time the Performance Rights or options vest, an
adjustment is made to reflect the actual cost to the BHP Billiton Limited
Group. The effect of this policy change for the year ended 30 June 2001 has
been a decrease in net profit attributable to members of BHP Billiton Limited
of $5 million.
Change of company name
During the financial year ended 30 June 2001, The Broken Hill Proprietary
Company Limited changed its name to BHP Limited with effect from 30 October
2000, and subsequently to BHP Billiton Limited with effect from 29 June 2001.
Change of financial year
Directors announced on 17 December 1999 that the financial year end for the
BHP Billiton Group would change from 31 May to 30 June with effect from 30
June 2000. All subsequent financial years will commence on 1 July and end on
30 June.
- Australian Securities and Investment Commission (ASIC)
Pursuant to Section 340 of the Corporations Act ('the Act'), ASIC granted
relief from the requirements of paragraph 323D(2)(b) of the Act permitting
BHP Billiton Limited to change its financial year end and adopt a
transitional thirteen month financial year of 1 June 1999 to 30 June 2000.
- Australian Stock Exchange (ASX)
The ASX has provided BHP Billiton Limited relief from listing rule 4.4 to the
extent that an Appendix 4B was not required for the period ended 31 May 2000
following the change in balance date from 31 May to 30 June. Comparative
figures for the thirteen months ended 30 June 2000 are in lieu of a 31 May
2000 Appendix 4B.
For information contact:
Investor Relations:
Robert Porter - Vice President Investor
Relations
(BH) (61 3) 9609 3540
Mobile (61) 419 587 456
E-mail: robert.r.porter@BHPBilliton.com
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