BHP Group (BHP Group) Interest Coverage : 29.25 (As of Dec. 2021)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. BHP Group's Operating Income for the six months ended in Dec. 2021 was $14,246 Mil. BHP Group's Interest Expense for the six months ended in Dec. 2021 was $-487 Mil. BHP Group's interest coverage for the quarter that ended in Dec. 2021 was 29.25. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for BHP Group's Interest Coverage or its related term are showing as below:

BBL's Interest Coverage is not ranked ^*
in the Metals & Mining industry.
Industry Median: No Debt
* Ranked among companies with meaningful Interest Coverage only.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

BHP Group Interest Coverage Historical Data

The historical data trend for BHP Group's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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BHP Group Annual Data

Trend

Jun12

Jun13

Jun14

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Interest Coverage

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8.19

10.43

10.10

10.51

29.20

BHP Group Semi-Annual Data
	Jun12	Dec12	Jun13	Dec13	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21
Interest Coverage	Get a 7-Day Free Trial															10.75	10.20	22.25	36.72	29.25

Competitive Comparison

For the Other Industrial Metals & Mining subindustry, BHP Group's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

BHP Group Interest Coverage Distribution

For the Metals & Mining industry and Basic Materials sector, BHP Group's Interest Coverage distribution charts can be found below:

* The bar in red indicates where BHP Group's Interest Coverage falls into.

BHP Group Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

BHP Group's Interest Coverage for the fiscal year that ended in Jun. 2021 is calculated as

Here, for the fiscal year that ended in Jun. 2021, BHP Group's Interest Expense was $-858 Mil. Its Operating Income was $25,050 Mil. And its Long-Term Debt & Capital Lease Obligation was $18,355 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Jun. 2021 )	/	Interest Expense (A: Jun. 2021 )
	=	-1	*	25050	/	-858
	=	29.20

BHP Group's Interest Coverage for the quarter that ended in Dec. 2021 is calculated as

Here, for the six months ended in Dec. 2021, BHP Group's Interest Expense was $-487 Mil. Its Operating Income was $14,246 Mil. And its Long-Term Debt & Capital Lease Obligation was $15,897 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2021 )	/	Interest Expense (Q: Dec. 2021 )
	=	-1	*	14246	/	-487
	=	29.25

The higher the ratio, the stronger the company's Financial Strength is.

BHP Group (NYSE:BBL) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

BHP Group Interest Coverage Related Terms

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BHP Group (BHP Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » BHP Group PLC (NYSE:BBL) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

N/A

Address

160 Victoria Street, Nova South, London, GBR, SW1E 5LB

Website

https://www.bhp.com

BHP is a leading global diversified miner supplying iron ore, copper, oil, gas, and metallurgical. The merger of BHP Limited (now BHP Ltd.) and Billiton PLC (now BHP PLC) created the present-day BHP. Shareholders in each company have equivalent economic and voting rights in BHP as a whole and in 2022 voted to reunify the dual listed structure. Major assets include Pilbara iron ore, Queensland coking coal, Escondida copper and conventional petroleum assets, principally in Australia and the Gulf of Mexico. Onshore U.S. oil and gas assets were sold in 2018 and the remaining Petroleum assets are likely to be spun off and merged with Woodside.