THE CASE FOR FIXING BHP: UNDERPERFORMANCE
If you had invested $100 in the ASX 200 Index five years ago, that money would be worth $145 today. But the same $100 invested in BHP five years ago would have fallen in value to just $84*
BHP operates in a business sector where proper financial, strategic and operational discipline is key to building and delivering optimal shareholder value – and avoiding value destruction. Unfortunately, BHP’s management has undertaken a number of significantly value-destructive initiatives, including:
- US$23 billion destroyed through the ill-fated foray into the US onshore petroleum sector;
- US$8 billion spent on petroleum exploration activities with no apparent value created;
- US$9 billion destroyed in share buybacks made at inflated market prices
BHP has significantly underperformed its peers over the long-term:
*Approximate share price basis calculation.