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BHP BILLITON PLC - Results for the Half Year Ended 31 December 2014

Release Date: 24/02/2015 07:08
Code(s): BIL     PDF:  
Wrap Text
Results for the Half Year Ended 31 December 2014

BHP Billiton Plc
Registration number 3196209
Registered in England and Wales
Share code: BIL
ISIN: GB0000566504


 
                                                                                                         24 February 2015


                    Results For Announcement to the Market

Name of Companies:                BHP Billiton Limited (ABN 49 004 028 077) and
                                  BHP Billiton Plc (Registration No. 3196209)

Report for the half year ended 31 December 2014

This statement includes the consolidated results of the BHP Billiton Group, comprising BHP
Billiton Limited and BHP Billiton Plc, for the half year ended 31 December 2014 compared with the
half year ended 31 December 2013 and the year ended 30 June 2014.

The results are prepared in accordance with IFRS and are presented in US dollars.

Headline Earnings

In accordance with the JSE Listing Requirements, Headline Earnings is presented below.

                                                                                Half year        Half year
                                                                                    ended            ended      Year ended
                                                                              31 December      31 December         30 June
                                                                                     2014             2013            2014
                                                                                     US$M             US$M            US$M

Earnings attributable to ordinary shareholders                                      4,265            8,107          13,832

Adjusted for:
Gain on sale of PP&E, Investments and Operations                                      (34)            (555)           (646)
Net impairments                                                                       756              143             797
Recycling of re-measurements from equity to the income statement(a)                    (1)              (2)            (14)
Tax effect of above adjustments                                                      (213)             164             (40)
Subtotal of adjustments                                                               508             (250)             97

Headline Earnings                                                                   4,773            7,857          13,929


Diluted Headline Earnings                                                           4,773            7,857          13,929



Basic earnings per share denominator (millions)                                     5,317            5,321           5,321
Diluted earnings per share denominator (millions)                                   5,334            5,337           5,338

Headline Earnings per share (US cents)                                               89.8            147.7           261.8
Diluted Headline Earnings per share (US cents)                                       89.5            147.2           260.9


   (a) Amounts recognised in profit and loss under cash-flow hedges that were previously recognised directly in other
       comprehensive income, are now included in Headline Earnings, previously they were excluded. Comparative amounts for
       the half year ended 31 December 2013 and year ended 30 June 2014 have been restated for this change.

NEWS RELEASE
Release Time IMMEDIATE
Date         24 February 2015
Number       02/15


              BHP BILLITON RESULTS FOR THE HALF YEAR ENDED 31 DECEMBER 2014

- The tragic loss of two of our colleagues is a stark reminder that the health and safety of our
  people must always come first.

- Underlying EBIT(1) of US$9.2 billion and an Underlying EBIT margin(2) of 32% for the December
  2014 half year results demonstrate the strength of BHP Billiton’s strategy and the resilience of
  our portfolio in weaker markets.

- Improved productivity and reduced capital expenditure allowed us to generate US$4.1 billion of
  free cash flow(2) and strengthen the balance sheet despite lower prices.

- We are extending our productivity gains faster than initially anticipated with US$2.4 billion(3)
  achieved in the period. We expect over US$4.0 billion of productivity gains by the end of the 2017
  financial year(4).

- Our cost competitiveness continues to improve in all our major businesses, with unit cash costs
  reduced by 29% Western Australia Iron Ore, 15% at Queensland Coal, 13% at Escondida and 8%
  at Onshore US.

- We reduced capital and exploration expenditure(5) by 23% to US$6.4 billion in the half year and
  plan to invest a total of US$12.6 billion in the 2015 financial year and US$10.8 billion in the 2016
  financial year.

- We will remain disciplined. Our plans are flexible and we continue to expect an average
  investment return(6) of greater than 20% for our portfolio of high-quality development options.

- Our balance sheet is strong. Net debt(2) at period end fell to US$24.9 billion for a gearing ratio of
  22.4% and our A+ credit rating was recently reaffirmed.

- The Group’s interim dividend increased by 5% to 62 US cents per share, representing and
  Underlying payout ratio(7) of 62%.

- Should the proposed demerger of South32 be approved, we do not plan to rebase our
  progressive dividend downwards, implying a higher underlying payout ratio, and South32 will
  adopt its own dividend policy.


Half year ended 31 December                                          2014           2013         Change
                                                                     US$M           US$M              %
Profit from operations (EBIT)                                       8,817         12,933         (31.8%)
Attributable profit                                                 4,265          8,107         (47.4%)
Basic earnings per share (cents)                                     80.2          152.4         (47.4%)
Dividend per share (cents)                                           62.0           59.0           5.1%
Net operating cash flow                                            10,423         11,859         (12.1%)
Underlying EBITDA(1)                                               14,494         16,518         (12.3%)
Underlying EBIT(1)                                                  9,226         12,382         (25.5%)
Underlying attributable profit(1)                                   5,352          7,761         (31.0%)
Underlying basic earnings per share (cents)(2)                      100.7          145.9         (31.0%)
Capital and exploration expenditure (BHP Billiton share)(5)         6,382          8,289         (23.0%)

Results for the half year ended 31 December 2014

BHP Billiton Chief Executive Officer, Andrew Mackenzie, said: “These results demonstrate the effectiveness of our
strategy and the quality of our people, assets and processes. Despite significant falls in the prices of our main
commodities over the last six months, Group margins remain healthy, free cash flow has increased and we have
strengthened our balance sheet. We are confident that we can maintain our progressive dividend policy and continue
to selectively invest in projects that offer compelling returns.

We started to prepare for a sustained period of lower prices almost three years ago by increasing our focus on
efficiency and lowering our investment. Since then, we have achieved annualised productivity gains approaching
US$10 billion and reduced capital spending by almost 40 per cent. We have seen rapid improvement across all of our
major businesses. For example, in the last six months alone we have cut unit costs at Western Australia Iron Ore by
29 per cent to nearly US$20 per tonne, achieving an Underlying EBIT margin of 49 per cent despite the structural shift
in prices.

This push for productivity must continue and our proposed demerger will be a catalyst for further
progress. Simplification will ensure BHP Billiton’s organisation, systems and processes are dedicated to its core
assets, allowing us to further improve their productivity. Meanwhile, South32 will benefit from a dedicated
management team who can tailor their strategy to suit their own distinct portfolio. Following the proposed demerger,
BHP Billiton will maintain its progressive dividend policy and any dividends from South32 will represent additional cash
returns to shareholders.

We remain confident about the outlook for our Company. We have the best quality assets and operating capability, a
deep understanding of global markets, a portfolio of very high-return growth projects, a strong balance sheet and offer
outstanding cash returns to shareholders. The demerger will allow us to continue the process of building an
organisation that is truly unique in our sector, and one that is well positioned for success in the face of ever-increasing
volatility.”

Our overriding commitment is to sustainability

Our commitment is to ensure the health and safety of our people. BHP Billiton reported a Total Recordable
Injury Frequency (TRIF) of 4.0 per million hours worked in the December 2014 half year. Despite the
continued improvement in TRIF, the tragic loss of two of our colleagues is a stark reminder that the health
and safety of our teams must always come first. This is far ahead of any commercial challenge. We achieve
nothing if we don’t achieve it safely and sustainably. We must continue to pursue effective material and
fatal risk management at our operations.

Robust results underpinned by our structured approach to productivity

BHP Billiton delivered robust financial results in the December 2014 half year, a period characterised by
volatile commodity markets. Underlying EBITDA declined by 12 per cent to US$14.5 billion as lower
average realised prices more than offset the substantial productivity gains that continue to be achieved
across the portfolio.

Group production(8) increased by nine per cent during the December 2014 half year with records achieved
for eight operations and five commodities. We remain on track to deliver Group production growth of 16 per
cent over the two years to the end of the 2015 financial year.

The Group extended its track record of delivering sustainable performance improvement with US$2.4
billion(3) of productivity gains achieved during the period. We remain on track to deliver at least US$4.0
billion(4) of productivity gains from our core portfolio by the end of the 2017 financial year. Volume growth
from the ramp up of our high-return development projects increased Underlying EBIT by a further US$1.3
billion. However, lower average realised prices reduced Underlying EBIT by US$6.1 billion, net of price-
linked costs, and were the major contributor to the 25 per cent decline in Underlying EBIT to US$9.2 billion.
Underlying attributable profit declined by 31 per cent to US$5.4 billion.

By further improving productivity and reducing our rate of investment we delivered a substantial US$4.1
billion of free cash flow during the period, despite weaker commodity prices. BHP Billiton’s share of capital
and exploration expenditure(5) declined by 23 per cent during the period to US$6.4 billion. Continued
improvement in the Group’s capital productivity is expected to support a reduction in forecast capital and
exploration expenditure for the 2015 financial year to US$12.6 billion, 15 per cent below original guidance.
We expect capital and exploration expenditure will further reduce to US$10.8 billion in the 2016 financial
year.

In our Petroleum Business, we have moved quickly in response to lower prices and will reduce our
operated rig count at Onshore US by approximately 40 per cent by the end of the 2015 financial year. This
decisive response exemplifies the Group’s value-focused approach to developing our tier-one resource
base and the flexibility we have to respond to external market conditions.

Disciplined approach to capital management

BHP Billiton’s capital management framework is unchanged. The Group remains committed to a strong
balance sheet and a solid A credit rating. These are fundamental enablers of our strategy and have allowed
us to maintain our progressive dividend and to invest through the cycle. In this context, net debt finished the
period at US$24.9 billion for a gearing ratio of 22.4 per cent and our A+ credit rating was recently
reaffirmed.

The Group increased its interim dividend by five per cent to 62 US cents per share which represents a
payout ratio of 62 per cent. Following the proposed demerger of South32, BHP Billiton will maintain its
progressive dividend policy and any dividends from South32 will represent additional cash returns to
shareholders.

Our high-quality portfolio remains a key point of differentiation. We will maintain our track record of
investing selectively in high-return growth options within our portfolio through the cycle. By operating within
a disciplined framework and by testing all investment decisions against challenging criteria, including
buying back our own shares, we will increase the capital efficiency of the Group. We continue to forecast
an average investment return of greater than 20 per cent(6) for our portfolio of high-quality development
options.

Proposed demerger will largely complete our simplification process in a single step

On 8 December 2014, BHP Billiton announced that the new company it intends to create through its
proposed demerger will be called South32. A final Board decision on the proposed demerger will be made
once all necessary third party approvals are secured on satisfactory terms. On this basis, BHP Billiton
expects to release all shareholder documentation with full details of the demerger in mid-March 2015, with
a shareholder vote taking place in early May 2015. The proposed demerger remains on track to be
completed in the first half of the 2015 calendar year.

If completed, the proposed demerger has the potential to unlock shareholder value by significantly
simplifying the Group and dividing it into two distinct portfolios, each reflecting the common characteristics
of their assets. Management processes will be optimised for each portfolio to enable higher levels of
performance than possible if managed together. Once simplified, BHP Billiton will be almost exclusively
focused on its exceptionally large, long-life iron ore, copper, coal, petroleum and potash basins, retaining
full exposure to the early, middle and late stages of the economic development cycle. With fewer assets
and a greater upstream focus, BHP Billiton will be able to reduce costs and further improve the productivity
of its largest businesses. As a result, BHP Billiton is expected to generate stronger growth in free cash flow
and a superior return on its investment. South32 will be an independent global metals and mining company
based on a selection of high-quality aluminium, coal, manganese, nickel and silver assets.

Outlook

Economic outlook

Global economic growth slowed slightly over the December 2014 half year with variable performance
across the major economies. Chinese growth experienced a moderate slowdown while some other large
emerging economies, notably Brazil and Russia, saw periods of contraction. Among developed economies,
both the United States and the United Kingdom saw solid growth supported by expansionary monetary
policies. In contrast, Europe lost momentum as deflationary pressures increased and Japan saw a pause in
its recovery.

The Chinese economy was healthy with slightly slower growth over the period consistent with government
targets. Household incomes and consumer spending were resilient and both monetary and fiscal policies
remain focused on rebalancing the economy. Consumption will become increasingly important over the
medium term as economic reforms promote slower but more sustainable growth.

The United States economy continued to improve with strong employment growth boosting both consumer
confidence and spending. Business investment, which had been a soft spot in the recovery, also rose
moderately. The economic recovery is expected to continue, supported by lower energy prices and growth
in consumer spending, bolstering expectations that the Federal Reserve will raise interest rates in the next
12 months.

Although the Japanese economy was weak over the December 2014 half year, leading indicators such as
industrial production and business confidence have begun to show signs of improvement. We expect the
recovery to continue at a modest pace, supported by lower energy prices and the weaker yen.

Commodities outlook

Demand for our products remained solid, despite growth moderating as anticipated. However, strong
supply growth, most notably in iron ore and petroleum, contributed to weaker prices in the December 2014
half year.

In China, domestic steel demand was subdued due to weakness in the property sector, resulting in record
exports to overseas markets where demand saw steady growth. In the 2015 calendar year Chinese
demand is expected to recover moderately, supplemented by healthy demand growth in the rest of the
world. While overall Chinese demand for iron ore was flat over the period, imports nonetheless increased
as high-cost domestic mine supply was displaced by lower-cost seaborne supply. As the marginal cost of
supply fell, the iron ore spot price also declined to levels which are now more reflective of the medium-term
fundamentals.

In metallurgical coal, China’s seaborne demand declined following a rise in domestic supply. Although
several producers outside China have announced production cuts, the volume removed from the market
has been less than anticipated and surplus supply is expected to persist in the short term. The thermal coal
market also continued to be well supplied by Indonesian and Australian exports while strong import
demand growth from India, driven by seasonal restocking, partially compensated for moderating Chinese
demand.

Crude oil prices fell in the first half of the 2015 financial year as a result of growing supply, a lower demand
outlook and OPEC’s decision to maintain production levels. With prices at approximately half the average
of the previous three years, the supply response required for a cyclical rebalancing of the market is under
way. While a near-term recovery in price depends on the rate that production growth slows, the medium-
term outlook appears positive as higher prices will be required to induce the new supply needed to offset
natural field decline.

In the United States, domestic gas prices came under pressure as continued supply growth allowed
storage inventories to rebuild despite relatively normal seasonal demand. In the longer term, industrial
demand growth, rising gas-fired power generation and LNG exports are expected to support prices. In the
LNG market, mild winter temperatures across North Asia and high storage levels have limited spot demand
while the ramp-up of new export projects and lower crude oil prices are expected to temper the market in
the second half of the financial year.

Copper prices trended lower during the period reflecting concerns over Chinese demand and a stronger US
dollar. While prices are expected to remain volatile, market fundamentals are compelling over the medium
term with robust demand growth expected and supply constrained by declining ore grades and a lack of
quality development options. The current low prices are expected to intensify the looming supply deficit, as
projects are deferred or delayed.

The nickel price declined following a sharp rise in the second half of the 2014 financial year, as the market
remained well supplied despite the ban on ore exports from Indonesia. Aluminium demand growth
remained strong but new supply, mostly from China, continues to offset the curtailment of high cost
capacity. Strong aluminium demand flowed through to higher alumina prices during the period. The alumina
price was also supported by the Indonesian ore ban, which removed low-cost bauxite supply for Chinese
alumina refineries.

Wealth creation and urbanisation will remain the primary drivers of commodities demand while the ongoing
development of emerging economies provides particular support for industrial metals, energy and fertilisers.
Our iron ore, copper, coal, petroleum and potash businesses provide exposure to this long-term
development cycle and will allow us to target high-return investments as markets continue to evolve.

In summary, we expect sustained growth in China, stronger consumer spending in the US and lower
energy prices to support an improvement in global economic activity over the course of the 2015 calendar
year. However some commodity prices will remain relatively volatile and oversupply in many of our markets
will continue to moderate prices. In the medium term, the structural requirement to induce new supply to
meet demand should be supportive for prices in some of our core commodities, most notably in copper and
oil. Our diversification, competitive cost position, strong balance sheet and the success of our ongoing
productivity initiatives are competitive advantages and provide us with unrivalled flexibility in the face of
ever-increasing volatility.

Projects

At the end of the December 2014 half year, BHP Billiton had seven major projects under development with
a combined budget of US$13.5 billion.

The Escondida Oxide Leach Area Project (OLAP) was successfully completed during the December 2014
half year and the BMA Hay Point Stage Three Expansion project loaded first coal on 12 January 2015, both
on revised schedule and budget. During the period, the Group approved a US$361 million increase to the
budget of the Escondida Organic Growth Project 1 to US$4.2 billion. The budget revision reflected
challenges associated with contractor progress which have since been addressed and the project remains
on original schedule.

BHP Billiton’s share of capital and exploration expenditure(5) declined by 23 per cent during the December
2014 half year to US$6.4 billion. Continued improvement in the Group’s capital productivity has supported a
further reduction in planned capital and exploration expenditure for the 2015 financial year to US$12.6
billion, 15 per cent below original guidance.
                                                                     Half year ended         Half year ended            Year ended
                                                                         31 December             31 December               30 June
                                                                                2014                    2013                  2014
                                                                                US$M                    US$M                  US$M
Capital expenditure (purchases of property, plant and
equipment)                                                                     6,772                   8,605                15,993
Add: exploration expenditure                                                     422                     504                 1,010
Capital and exploration expenditure (cash basis)                               7,194                   9,109                17,003
Add: equity accounted investments                                                341                     542                   871
Less: capitalised deferred stripping(i)                                         (467)                   (784)               (1,421)
Less: non-controlling interests                                                 (686)                   (578)               (1,272)
Capital and exploration expenditure (BHP Billiton
share)                                                                         6,382                   8,289                15,181
(i) Includes US$88 million of capitalised deferred stripping attributable to non-controlling interests (December 2013 half year:
    US$126 million; June 2014 financial year: US$243 million).

Projects completed during the December 2014 half year

Business     Project and                 Capacity(i)                                  Capital                     Date of initial
             ownership                                                            expenditure                          production
                                                                                       US$M(i)

                                                                         Actual(ii)    Budget             Actual          Target
Copper       Escondida Oxide             New dynamic leaching                   911       933(iii)       Q4 CY14     H2 CY14(iii)
             Leach Area Project          pad and mineral handling
            (Chile)                      system. Maintains oxide
             57.5%                       leaching capacity.
                                                                                911       933


Projects in execution at the end of the December 2014 half year

Business     Project and                    Capacity(i)                                   Capital             Date of initial
             ownership                                                                expenditure                  production
                                                                                           US$M(i)
                                                                                           Budget                     Target
Petroleum    North West Shelf Greater       To maintain LNG plant throughput                  400                       CY16
             Western Flank-A                from North West Shelf operations.
            (Australia)
             16.67% (non-operator)
             Bass Strait Longford Gas       Designed to process approximately                 520                       CY16
             Conditioning                   400 MMcf/d of high CO2 gas.
             Plant (Australia)
             50% (non-operator)
Copper       Escondida Organic              New concentrator with 152 ktpd                  4,199(iii)               H1 CY15
             Growth Project 1 (Chile)       capacity.
             57.5%
             Escondida Water Supply         New desalination facility to ensure             3,430                       CY17
            (Chile)                         continued water supply to Escondida.
             57.5%
Coal         Hay Point Stage Three          Increases port capacity from 44 Mtpa            1,505(iii)(iv)          CY15(iii)
             Expansion (Australia)          to 55 Mtpa and reduces storm
             50%                            vulnerability.
             Appin Area 9 (Australia)       Maintains Illawarra Coal’s production             845                       CY16
             100%                           capacity with replacement mining
                                            domain and capacity to produce 3.5
                                            Mtpa of metallurgical coal.
                                                                                           10,899


Other projects in progress at the end of the December 2014 half year

Business        Project and             Scope                                                                       Capital
                ownership                                                                                       expenditure
                                                                                                                     US$M(i)
                                                                                                                     Budget
Potash          Jansen Potash (Canada)  Investment to finish the excavation and lining                                2,600
                100%                    of the production and service shafts, and to
                                        continue the installation of essential surface
                                        infrastructure and utilities.

(i)   Unless noted otherwise, references to capacity are on a 100 per cent basis, references to capital expenditure from subsidiaries
      are reported on a 100 per cent basis and references to capital expenditure from joint operations are reported on a
      proportionate consolidation basis.
(ii)  Amount subject to finalisation.
(iii) As per revised budget and/or schedule.
(iv)  Excludes announced pre-commitment funding.

Income statement

To provide additional clarity into the underlying performance of our operations we present Underlying EBIT,
which is a measure used internally. Underlying EBIT represents Profit from operations excluding
exceptional items (which are described on pages 10 and 11) as set out in the following table:

Half year ended 31 December                                                  2014                   2013
                                                                             US$M                   US$M
Underlying EBIT                                                             9,226                 12,382
Exceptional items (before taxation)                                          (409)                   551
Profit from operations (EBIT)                                               8,817                 12,933

Underlying EBIT

The following table and commentary describes the approximate impact of the principal factors that affected
Underlying EBIT for the December 2014 half year compared with the December 2013 half year:

                                                                                                    US$M
Underlying EBIT for the half year ended 31 December 2013                                          12,382
Change in volumes:
 Productivity                                                                                        530
 Growth                                                                                            1,341
                                                                                                   1,871
Net price impact:
 Change in sales prices                                                                           (6,550)
 Price-linked costs                                                                                  413
                                                                                                  (6,137)
Change in controllable cash costs:
 Operating cash costs                                                                              1,766
 Exploration and business development                                                                (12)
                                                                                                   1,754
Change in other costs:
 Exchange rates                                                                                      626
 Inflation                                                                                          (359)
 Fuel and energy                                                                                     233
 Non-cash                                                                                           (938)
                                                                                                    (438)
Asset sales                                                                                           30
Ceased and sold operations                                                                           (39)
Other items                                                                                         (197)
Underlying EBIT for the half year ended 31 December 2014                                           9,226

The following table reconciles principal factors shown on the previous page with the Group’s productivity
gains:

Half Year ended 31 December                                                                         2014
                                                                                                    US$M
Change in controllable cash costs                                                                  1,754
Changes in volumes attributed to productivity                                                        530
Total productivity gains in Underlying EBIT                                                        2,284
Change in capitalised exploration                                                                     99
Total benefits attributable to productivity initiatives                                            2,383

Volumes

Productivity-led volume efficiencies and the ramp up of major projects underpinned a nine per cent
increase in Group production(8) in the December 2014 half year and a US$1.9 billion increase in
Underlying EBIT. Western Australia Iron Ore was the major contributor as the ramp-up of Jimblebar and
improvements in availability, utilisation and rate across its integrated supply chain supported a US$1.2
billion increase in Underlying EBIT. Significant growth in Onshore US liquids volumes, which reflected
continued momentum in the Black Hawk and Permian, supported a US$601 million volume-related
increase in Petroleum’s Underlying EBIT.

We remain on track to generate Group production(8) growth of 16 per cent over the two years to the end of
the 2015 financial year.

Prices

Demand for our products remained solid, despite growth moderating as anticipated. However strong supply
growth, most notably in iron ore and petroleum, contributed to weaker prices in the December 2014 half
year.

Lower average realised prices reduced Underlying EBIT by US$6.6 billion in the December 2014 half year.
A 38 per cent decline in the average realised price of iron ore was the major contributor and reduced
Underlying EBIT by US$4.6 billion. A 17 per cent reduction in average realised oil prices reduced
Underlying EBIT by US$802 million, while weaker coal prices, both thermal and coking, reduced Underling
EBIT by a further US$775 million.

A reduction in price-linked costs increased Underlying EBIT by US$413 million during the period and
primarily reflected lower royalty charges in our Iron Ore Business.

The average realised prices achieved for our major commodities are summarised in the following table:

                                                    Half year ended           Year ended    Dec H14       Dec H14       Dec H14
                                             31 Dec     31 Dec    30 Jun          30 Jun         vs            vs            vs
Average realised prices(i)                     2014       2013      2014            2014    Dec H13       Jun H14          FY14
Oil (crude and condensate) (US$/bbl)             85        103       102             102       (17%)         (17%)         (17%)
Natural gas (US$/Mscf)(ii)                     4.21       3.81      4.89            4.35        10%          (14%)          (3%)
US natural gas (US$/Mscf)                      3.89       3.44      4.75            4.10        13%          (18%)          (5%)
LNG (US$/Mscf)                                13.76      14.63     14.71           14.67        (6%)          (6%)          (6%)
Copper (US$/lb)(iii)(iv)                       2.98       3.36      3.09            3.22       (11%)          (4%)          (7%)
Iron ore (US$/wmt, FOB)                          70        112        96             103       (38%)         (27%)         (32%)
Hard coking coal (US$/t)                        110        142       121             131       (23%)          (9%)         (16%)
Weak coking coal (US$/t)                         92        116       104             111       (21%)         (12%)         (17%)
Thermal coal (US$/t)(v)                          60         74        67              70       (19%)         (10%)         (14%)
Alumina (US$/t)(ii)                             330        291       320             307        13%            3%            7%
Aluminium (US$/t)                             2,378      1,996     2,049           2,022        19%           16%           18%
Manganese ore (US$/dmtu)(ii)                   4.00       4.90      4.41            4.64       (18%)          (9%)         (14%)
Manganese alloy (US$/t)                         946        952     1,001             980        (1%)          (5%)          (3%)
Nickel metal (US$/t)                         16,757     13,615    16,391          14,925        23%            2%           12%

(i)     Based on provisional, unaudited estimates. Prices exclude third party product and represent the weighted average of various
        sales terms (for example: FOB, CIF and CFR), unless otherwise noted.
(ii)    Excludes internal sales.
(iii)   Includes third party product.
(iv)    Includes impact of provisional pricing and finalisation adjustments which decreased EBIT by US$210 million in the December
        2014 half year (December 2013 half year: US$196 million increase).
(v)     Export sales only; excludes Cerrejón. Includes thermal coal sales from metallurgical coal mines.

Controllable cash costs

A broad-based improvement in productivity underpinned a significant US$1.8 billion reduction in
controllable cash costs during the period.

Operating cash costs

Across our business, the productivity of our workforce continued to improve as we sharpened our focus on
the highest value-adding activities. In total, improved labour and contractor productivity increased
Underlying EBIT by US$725 million. An improvement in Group equipment productivity, as exemplified by a
14 per cent increase in truck utilisation at Escondida, supported a further US$516 million increase in
Underlying EBIT. In total, operating cash costs declined by US$1.8 billion during the period.

Exploration and business development

The Group’s exploration and business development expenditure was in line with the December 2013 half
year. Our exploration program remains focused on greenfield copper targets within Chile, Peru and the
South-West United States, and petroleum liquids opportunities in the Gulf of Mexico, Western Australia and
Trinidad and Tobago.

Other costs

Exchange rates

A stronger US dollar increased Underlying EBIT by US$626 million during the period. This included the
restatement of monetary items in the balance sheet which increased Underlying EBIT by US$220 million.

The following exchange rates have been applied:
                                                   Average           Average
                                           Half year ended   Half year ended         As at          As at      As at
                                               31 December       31 December   31 December    31 December    30 June
                                                      2014              2013          2014           2013       2014

Australian dollar(i)                                  0.89              0.92          0.82           0.89       0.94
Chilean peso                                           587               511           607            524        551
Colombian peso                                       2,037             1,910         2,392          1,927      1,881
Brazilian real                                        2.40              2.28          2.66           2.34       2.20
South African rand                                   10.99             10.07         11.55          10.53      10.60

(i)   Displayed as US$ to A$1 based on common convention.


Inflation

Inflation had an unfavourable impact on all businesses and reduced Underlying EBIT by US$359 million
during the period. This was most notable in Australia, Chile and South Africa, which accounted for over
85 per cent of the total variance.

Fuel and energy

A reduction in diesel prices and lower consumption, particularly in our Iron Ore and Coal Businesses,
supported a US$233 million increase in Underlying EBIT.

Non-cash

An increase in non-cash charges reduced Underlying EBIT by US$938 million during the December 2014
half year. Impairment charges associated with the divestment of conventional petroleum assets in North
Louisiana and unconventional gas assets in the Pecos field in the Permian totalled US$328 million. An
increase in non-cash charges in our Copper Business reduced Underlying EBIT by US$442 million and
reflected a lower capitalisation rate for deferred stripping at Escondida and Pampa Norte.

Asset sales

The contribution of asset sales to Underlying EBIT was largely unchanged from the prior period.

Ceased and sold operations

Underlying EBIT from ceased and sold operations decreased by US$39 million in the period and largely
reflected the closure of the Nickel West Leinster Perseverance underground mine in November 2013.

Other items

Lower average realised prices received by our equity accounted investments and transaction costs
associated with the proposed demerger accounted for the US$197 million decrease in Underlying EBIT
reported in other items.

Net finance costs

Net finance costs decreased by US$296 million to US$232 million. The decrease reflected foreign
exchange gains on finance leases and the early redemption of the Petrohawk Energy Corporation Senior
Notes in August 2014, resulting in a gain on redemption and lower interest expense.

Taxation expense

The Group’s adjusted effective tax rate, which excludes the influence of exchange rate movements,
remeasurement of deferred tax assets associated with the Minerals Resource Rent Tax (MRRT) and
exceptional items, was 31.3 per cent (31 December 2013: 32.5 per cent). This adjusted effective tax rate is
expected to remain in the range of 30 per cent to 34 per cent for the 2015 financial year.

Total taxation expense, including royalty-related taxation, exceptional items and exchange rate movements,
was US$3.8 billion, representing a statutory effective tax rate of 44.2 per cent (31 December 2013: 28.4 per
cent).

Government imposed royalty arrangements calculated by reference to profits are reported as royalty-
related taxation. The MRRT increased taxation expense by US$643 million in the December 2014 half year
(December 2013 half year: decrease of US$462 million). This included an exceptional item of US$809
million tax expense (December 2013 half year: US$ nil) for the derecognition of deferred tax assets upon
the repeal of the MRRT legislation in Australia.

Exchange rate movements increased taxation expense by US$290 million (December 2013 half year:
decrease of US$46 million).

Half year ended 31 December 2013                   2014                                       2013
                                       Profit    Income tax                    Profit   Income tax
                                   before tax       expense                before tax      expense
                                         US$M          US$M        %             US$M         US$M         %

Statutory effective tax rate            8,585        (3,792)   44.2%           12,405       (3,518)    28.4%
Adjusted for:
Exchange rate movements                     -           290                         -          (46)
Remeasurement of deferred tax
assets associated with the MRRT             -             -                         -         (491)
Exceptional items                         409           690                      (551)         205
Adjusted effective tax rate             8,994        (2,812)   31.3%           11,854       (3,850)    32.5%


Other royalty and excise arrangements which are not profit based are recognised as operating costs within
Profit before taxation. These amounted to US$1.1 billion during the period (December 2013 half year:
US$1.4 billion).

Exceptional Items

Half year ended 31 December 2014                                      Gross            Tax              Net
                                                                       US$M           US$M             US$M
Exceptional items by category
Repeal of Minerals Resource Rent Tax legislation                          –           (809)            (809)
Impairment of Nickel West assets                                       (409)           119             (290)
                                                                       (409)          (690)          (1,099)

Repeal of Minerals Resource Rent Tax legislation

On 2 September 2014, legislation to repeal the Minerals Resource Rent Tax (MRRT) in Australia received
the support of both Houses of Parliament and took effect on 30 September 2014. As a result, the Group
derecognised an MRRT deferred tax asset of US$809 million (after tax consequences) and a
corresponding taxation charge of US$809 million was recognised in the December 2014 half year.

Impairment of Nickel West assets

On 12 November 2014, the Group announced that the review of its Nickel West business was complete
and the preferred option, the sale of the business, was not achieved on an acceptable basis. As a result of
operational decisions made subsequent to the conclusion of this process, an impairment charge of US$290
million (after tax benefit) was recognised in the December 2014 half year.

Cash flows

Free cash flow, comprising net operating cash flows less net investing cash flows, increased by US$709
million to US$4.1 billion during the period.

Net operating cash flows after interest and tax decreased by 12 per cent to US$10.4 billion for the period.
The major contributor was the US$1.5 billion decrease in cash generated from operations (after changes in
working capital balances).

Net investing cash outflows decreased by US$2.1 billion to US$6.3 billion for the period and reflected a
US$1.9 billion reduction in capital and exploration expenditure. Expenditure on major projects totalled
US$5.2 billion, including US$2.5 billion on Petroleum projects and US$2.7 billion on Minerals projects.
Sustaining capital expenditure and other items totalled US$1.6 billion. Exploration expenditure was US$422
million, including US$359 million classified within net operating cash flows.

Net financing cash flows changed from a net inflow of US$1.8 billion to a net outflow of US$6.8 billion
primarily due to a decrease in proceeds from borrowings of US$5.2 billion. An increase in repayments of
interest bearing liabilities of US$1.7 billion and a decrease in contributions from non-controlling interests of
US$1.3 billion also contributed to the change during the period.

Net debt, comprising interest bearing liabilities less cash, finished the period at US$24.9 billion, a decrease
of US$847 million compared to the net debt position at 30 June 2014.

Dividend

BHP Billiton has a progressive dividend policy. The aim of this policy is to at least maintain or steadily
increase our base dividend in US dollars terms at each half-yearly payment. Our Board today determined to
pay an interim dividend of 62 US cents per share. We will seek to steadily increase or at least maintain the
dividend per share in US dollar terms at each half-yearly payment following the proposed demerger,
implying a higher payout ratio.

The interim dividend to be paid by BHP Billiton Limited will be fully franked for Australian taxation purposes.
Dividends for the BHP Billiton Group are determined in US dollars. However, BHP Billiton Limited dividends
are mainly paid in Australian dollars, and BHP Billiton Plc dividends are mainly paid in pounds sterling and
South African rand to shareholders on the UK section and the South African section of the register,
respectively. Currency conversions will be based on the foreign currency exchange rates on the Record
Date, except for the conversion into South African rand, which will take place on the last day to trade (cum
dividend) on JSE Limited, being 6 March 2015. Please note that all currency conversion elections must be
registered by the Record Date, being 13 March 2015. Any currency conversion elections made after this
date will not apply to this interim dividend.

The timetable in respect of this dividend will be:

Last day to trade cum dividend on JSE Limited (JSE) and currency conversion into rand            6 March 2015
Ex-dividend Date JSE                                                                             9 March 2015
Ex-dividend Date Australian Securities Exchange (ASX) and New York Stock Exchange
(NYSE)                                                                                          11 March 2015
Ex-dividend Date London Stock Exchange (LSE)                                                    12 March 2015
Record Date (including currency conversion and currency election dates for Australian and
London stock exchanges)                                                                         13 March 2015
Payment Date                                                                                    31 March 2015

American Depositary Shares (ADSs) each represent two fully paid ordinary shares receive dividends
accordingly.

BHP Billiton Plc shareholders registered on the South African section of the register will not be able to
dematerialise or rematerialise their shareholdings between the dates of 9 and 13 March 2015 (inclusive),
nor will transfers between the UK register and the South African register be permitted between the dates of
6 and 13 March 2015 (inclusive).

Details of the currency exchange rates applicable for the dividend will be announced to the relevant stock
exchanges following conversion and will appear on the Group’s website.

Debt management and liquidity

In August 2014, the Group redeemed all outstanding Petrohawk Energy Corporation 7.25 per cent Senior
Notes due August 2018 and 6.25 per cent Senior Notes due June 2019 at the applicable call prices. The
aggregate principal value of the notes redeemed was approximately US$1.8 billion.

The Group has a US$6.0 billion commercial paper program backed by a US$6.0 billion revolving credit
facility. The facility has a five year maturity and expiry date in May 2019 with two one-year extension
options. As at 31 December 2014, the Group had US$240 million outstanding in the US commercial paper
market and the Group’s cash and cash equivalents on hand were US$6.1 billion.

Corporate governance

As announced on 19 August 2014, David Crawford retired as an independent, Non-executive Director on
20 November 2014.

On 12 December 2014, we announced the appointment of Ms Carolyn Hewson as Chairman of the
Remuneration Committee. The current members of the Board’s committees are:

Risk and Audit                      Nomination and                    Remuneration                     Sustainability
Committee                           Governance Committee              Committee                        Committee
Mr L Maxsted (Chair)                Mr J Nasser (Chair)               Ms C Hewson (Chair)              Dr J Schubert (Chair)
Mr M Broomhead                      Sir J Buchanan                    Sir J Buchanan                   Mr M Broomhead
Mr W Murdy                          Dr J Schubert                     Mr C Cordeiro                    Mr M Brinded
Baroness S Vadera                                                     Mr P Davies                      Mr P Davies
                                                                      Baroness S Vadera                Mr K Rumble

On 1 January 2015 the Finance Committee was dissolved and the responsibilities of the former Finance
Committee have been assumed by the Risk and Audit Committee or the Board.

Business summary(i)

A summary of the performance of the Business for the December 2014 and December 2013 half year is
presented below.


Half year ended                                                           Profit from        Net      Capital
31 December 2014                    Revenue (ii)   Underlying Exceptional  operations  operating  expenditure  Exploration    Exploration to
US$ million                                         EBIT(iii)       items       (EBIT)    assets         (iv)      gross(v)        profit(vi)

Petroleum and Potash                      6,936        2,144            -       2,144     38,989        2,825          269               257
Copper                                    6,267        2,208            -       2,208     23,227        1,911           44                44
Iron Ore                                  8,418        4,200            -       4,200     24,433        1,104           71                16
Coal                                      4,297          178            -         178     14,784          715           14                14
Aluminium, Manganese and Nickel           4,193          716         (409)        307      8,931          214           24                20
Group and unallocated items(vii)             27         (220)           -        (220)       702            3            -                 -
Inter-segment adjustment                   (238)           -            -           -          -            -            -                 -
BHP Billiton Group                       29,900        9,226         (409)      8,817    111,066        6,772          422               351




Half year ended                                                            Profit from       Net     Capital
31 December 2014                                Underlying   Exceptional    operations operating expenditure  Exploration   Exploration to
US$ million                        Revenue (ii)   EBIT(iii)        items         (EBIT)   assets        (iv)      gross(v)       profit(vi)

Petroleum and Potash                      7,071      2,506             -        2,506     39,111      3,349           308              268
Copper                                    7,090      2,889           551        3,440     21,780      1,870            72               72
Iron Ore                                 10,992      6,499             -        6,499     23,446      1,711            78               57
Coal                                      4,745        510             -          510     14,420      1,407            18               18
Aluminium, Manganese and Nickel           4,160        148             -          148      9,239        250            28               25
Group and unallocated items(vii)             54       (170)            -         (170)       639         18             -                -
Inter-segment adjustment                  (164)          -             -            -          -          -             -                -
BHP Billiton Group                       33,948     12,382           551       12,933    108,635      8,605           504              440

(i)   Group and business level information is reported on a statutory basis which, in relation to Underlying EBIT, includes net finance
      costs and taxation expense related to equity accounted investments.
(ii)  Revenue is based on Group realised prices and includes third party products. Sale of third party products by the Group
      contributed revenue of US$1,034 million and Underlying EBIT of US$31 million (2013: US$1,739 million and US$85 million).
(iii) Underlying EBIT is earnings before net finance costs, taxation expense and any exceptional items. Underlying EBIT includes
      the Group’s share of net finance costs and taxation expense of US$269 million related to equity accounted investments (2013:
      net finance costs and taxation expense of US$367 million).
(iv)  Capital expenditure is presented on a cash basis and excludes capitalised interest and capitalised exploration. Comparative
      period capital expenditure was previously reported on an accruals basis and has been restated on a cash basis.
(v)   Includes US$63 million capitalised exploration (2013: US$162 million).
(vi)  Includes a net reversal of US$8 million exploration expenditure previously capitalised, written off as impaired (included in
      depreciation and amortisation) (2013: US$98 million exploration expenditure previously capitalised, written off as impaired).
(vii) Includes Group Functions, unallocated operations, consolidation adjustments and external sales of freight and fuel to third
      parties.


Petroleum and Potash

Total petroleum production increased by nine per cent in the December 2014 half year to a record 131.0
MMboe. A 24 per cent increase in liquids production to 62.1 MMboe was supported by a 71 per cent
increase in Onshore US liquids volumes and strong performance at both Pyrenees and Atlantis. Natural
gas production declined by two per cent to 413 bcf as improved uptime at North West Shelf and Macedon
was offset by lower seasonal demand at Bass Strait and the divestment of Liverpool Bay which was
completed in the 2014 financial year.

Total petroleum production guidance for the 2015 financial year remains unchanged at 255 MMboe.

Underlying EBIT for Petroleum decreased by US$390 million to US$2.2 billion in the December 2014 half
year. Strong volume growth increased Underlying EBIT by US$601 million, although this was offset by
lower average realised petroleum prices which reduced Underlying EBIT by US$754 million, net of price-
linked costs. Impairment charges (non-cash) associated with the divestment of conventional petroleum
assets in North Louisiana and unconventional gas assets in the Pecos field in the Permian reduced
Underlying EBIT by US$328 million.

Petroleum capital expenditure declined by 14 per cent to US$2.6 billion in the December 2014 half year
and included US$1.9 billion of Onshore US drilling and development expenditure. We continue to realise
significant improvements in shale drilling and completions efficiency as drilling costs in the Black Hawk
declined by 17 per cent to US$3.7 million per well during the period and spud to sales timing improved by
11 per cent. In addition to improved capital efficiency, we achieved an eight per cent reduction in unit cash
costs at Onshore US. In our Conventional business, we remain focused on high-return infill drilling
opportunities in the Gulf of Mexico and life extension projects at Bass Strait and North West Shelf.

Onshore US unit costs (US$ million)                                 H1 FY15                      H1 FY14                   FY14
Revenue                                                               2,380                        1,827                  4,264

Underlying EBITDA                                                     1,385                          856                  2,270

cash costs (gross)                                                      995                          971                  1,994

Less: freight                                                           307                          355                    666

Cash costs (net)                                                        688                          616                  1,328

Production (MMboe)(i)                                                  61.7                         50.9                  108.2

Cash cost per boe (US$)                                               11.15                        12.10                  12.27
(i)   Production volumes are reported net of royalties and are closely aligned with sales volumes.

In response to weaker prices, the Company will reduce its Onshore US operated rig count from 26 at period
end to 16 by the end of the 2015 financial year. The majority of the revised drilling program will be focused
on our liquids-rich Black Hawk acreage with activity in the Permian and Hawkville limited to the retention of
core acreage. The Company’s dry gas development program will be reduced to one operated rig in the
Haynesville, with a focus on continued drilling and completions optimisation ahead of full field development.
The reduction in drilling activity will not impact 2015 financial year production guidance and we remain
confident that shale liquids volumes will rise by approximately 50 per cent in the period. As a result of the
reduction in drilling activity, we now expect Onshore US drilling and development expenditure of
approximately US$3.4 billion for the 2015 financial year, 15 per cent below original guidance of US$4
billion. A further reduction to approximately US$2.2 billion is expected in the 2016 financial year. We
continue to monitor market conditions and will exercise the flexibility within our shale portfolio to maximise
value.

We have concluded the marketing of our Fayetteville acreage and have decided to retain it within our
portfolio to maximise value. The longer-term development of the Fayetteville remains an attractive option
and with the majority of our acreage held by production, we will continue to defer investment for value,
consistent with our long-term outlook for gas prices.

On 16 February 2015, BHP Billiton signed an agreement with Tri-Resources, a subsidiary of the Hashoo
Group, for the sale of our gas business in Pakistan. The transaction is subject to regulatory approval.

December 2014 half year                                  Liquids focused areas                   Gas focused areas
(December 2013 half year)                               Eagle Ford            Permian       Haynesville   Fayetteville(i)           Total

Capital expenditure(ii)             US$ billion           1.2 (1.6)          0.4 (0.2)         0.2 (0.2)        0.1 (0.1)        1.9 (2.1)

Rig allocation                      At period end           18 (18)              5 (2)             3 (5)            0 (0)          26 (25)
Net wells drilled and completed
(iii)                               Period total           85 (154)            18 (18)           13 (17)          27 (49)        143 (238)

Net productive wells                At period end         732 (544)        49(iv) (46)     406(iv) (879)    1,049 (1,000)    2,236 (2,469)

(i)  Fayetteville net wells drilled and completed and net productive wells restated post period end.
(ii) Includes land acquisition, site preparation, drilling, completions, well site facilities, mid-stream infrastructure and pipelines.
(iii)The number of wells drilled and completed can vary significantly from period to period based on changes in rig activity and the
     inventory of wells drilled but not yet completed at period end.
(iv) Change in productive well count includes reduction associated with North Louisiana acreage and Pecos acreage divestments.


Petroleum exploration expenditure for the December 2014 half year was US$268 million, of which US$244
million was expensed. Total petroleum exploration expenditure for the 2015 financial year is now forecast to
be US$600 million, a 20 per cent reduction from original guidance. The program will remain focused on the
Gulf of Mexico, Western Australia and Trinidad and Tobago.

The seismic acquisition program in Trinidad and Tobago was successfully completed for the seven deep
water blocks accessed between 2012 and 2014(9). The acquisition for the two blocks awarded in the 2014
deep water bid round is progressing on schedule(10).

Potash recorded an Underlying EBIT loss of US$112 million which was largely unchanged from the prior
period.

On 20 August 2013, BHP Billiton announced an investment of US$2.6 billion to finish the excavation and
lining of the Jansen Potash project production and service shafts, and to continue the installation of
essential surface infrastructure and utilities. The overall project was 39 per cent complete and within the
approved budget at the end of the period.

With our investment premised on the attractive longer-term market fundamentals for potash, we will
continue to review the appropriate pace and level of development activity and capital expenditure for the
project.

Financial information for the Petroleum and Potash Business for the December 2014 and December 2013
half years is presented below.

Half year ended                                                                          Net
31 December 2014                              Underlying         D&A  Underlying   operating                Exploration      Exploration to
US$ million                         Revenue       EBITDA                    EBIT      assets       Capital    gross(ii)         profit(iii)
                                        (i)                                                    expenditure
Bass Strait                             860          719          72         647       3,040           191
North West Shelf                      1,157          860         101         759       1,892            71
Atlantis                                701          641         192         449       2,196           174
Shenzi                                  611          555         147         408       1,435            97
Mad Dog                                 105           51          15          36         578            48
Onshore US(iv)                        2,380        1,385       1,747        (362)     26,329         1,923
Algeria                                 203          171          19         152         106            11
UK                                       21           14          32         (18)        (89)            -
Exploration                               -         (244)         43        (287)        531             -
Other(v)                                862          699         246         453       1,466            89
Total Petroleum                       6,900        4,851       2,614       2,237      37,484         2,604          268                256
Potash                                    -         (109)          3        (112)      2,507           221            1                  1
Other(vi)                                 -           19           -          19      (1,002)            -            -                  -
Total Petroleum and Potash from
Group production                      6,900        4,761       2,617       2,144      38,989         2,825          269                257
Third party products                     44            -           -           -           -             -
Total Petroleum and Potash            6,944        4,761       2,617       2,144      38,989         2,825          269                257
Statutory adjustments(vii)               (8)          (2)         (2)          -           -             -            -                  -
Total Petroleum and Potash
statutory result                      6,936        4,759       2,615       2,144      38,989         2,825          269                257



Half year ended                                                                            Net
31 December 2013                    Revenue  Underlying                  Underlying  operating      Capital  Exploration        Exploration to
US$ million                              (i)     EBITDA           D&A          EBIT     assets  expenditure     gross(ii)           profit(iii)

Bass Strait                             948         779            65           714      2,912          142
North West Shelf                      1,230         871            80           791      1,834           86
Atlantis                                718         663           155           508      2,339          273
Shenzi                                  695         634           114           520      1,504          110
Mad Dog                                 126         114             8           106        486           35
Onshore US                            1,827         856         1,154          (298)    26,247        2,143
Algeria                                 249         218            16           202         86           14
UK(viii)                                 82         (68)           32          (100)       (47)           6
Exploration                               -        (147)          125          (272)       491            -
Other(v)                                916         684           234           450      1,939          235
Total Petroleum                       6,791       4,604         1,983         2,621     37,791        3,044          285                  245
Potash                                    -        (110)            3          (113)     2,007          305           23                   23
Other(vi)                                 6          (8)            -            (8)      (687)           -            -                    -
Total Petroleum and Potash from
Group production                      6,797       4,486         1,986         2,500     39,111        3,349          308                  268
Third party products                    281           6             -             6          -            -
Total Petroleum and Potash            7,078       4,492         1,986         2,506     39,111        3,349          308                  268
Statutory adjustments(vii)               (7)         (2)           (2)            -          -            -            -                    -
Total Petroleum and Potash
statutory result                      7,071       4,490         1,984         2,506     39,111        3,349          308                  268

(i)   Petroleum revenue from Group production includes: crude oil US$4,001 million (2013: US$4,076 million), natural gas
      US$1,439 million (2013: US$1,380 million), LNG US$833 million (2013: US$803 million), NGL US$429 million (2013: US$420
      million) and other US$190 million (2013: US$105 million).
(ii)  Includes US$24 million of capitalised exploration (2013: US$138 million).
(iii) Includes US$12 million of exploration expenditure previously capitalised, written off as impaired (included in D&A) (2013:
      US$98 million).
(iv)  Includes US$328 million of impairments as a result of the divestment of assets in North Louisiana and the Pecos field in the
      Permian.
(v)   Includes Macedon, Pyrenees, Stybarrow, Neptune, Minerva, Angostura, Genesis, Pakistan, divisional activities and business
      development. Also includes the Caesar oil pipeline and the Cleopatra gas pipeline which are equity accounted investments and
      are reported on a proportionate consolidation basis (with the exception of net operating assets).
(vi)  Includes closed mining and smelting operations in Canada and the United States.
(vii) Includes statutory adjustments for the Caesar oil pipeline and the Cleopatra gas pipeline to reconcile the proportionately
      consolidated business total to the statutory result.
(viii)Includes an expense of US$115 million incurred in November 2013 related to the closure of the UK pension plan. Also
      includes Liverpool Bay which was divested in March 2014.


Copper

Total copper production(11) decreased by two per cent in the December 2014 half year to 813 kt.
Escondida copper production decreased by two per cent to 553 kt as strong operating performance was
offset by the impact of water restrictions, two days of industrial action and a power outage throughout
Northern Chile. Pampa Norte production increased by 22 per cent to 125 kt as Spence benefited from
higher grades and recoveries while Olympic Dam copper production increased by four per cent to 82 kt.
Antamina copper production declined by 37 per cent to 53 kt as lower grades more than offset record mill
throughput for the period, consistent with the mine plan.

BHP Billiton total copper production guidance for the 2015 financial year is under review following an
electrical failure which caused a mill outage at Olympic Dam in February 2015. The mill is expected to be
offline for approximately six months with an associated reduction in copper production of between 60 to 70
kt. An update will be provided in the March 2015 Operational Review. Escondida remains on track to
deliver 1.27 Mt of copper production in the 2015 financial year.

Underlying EBIT for the December 2014 half year declined by US$681 million to US$2.2 billion. Lower
average realised prices decreased Underlying EBIT by US$763 million, net of price-linked costs. In
contrast, productivity-led cost efficiencies increased Underlying EBIT by US$677 million. In this context,
Escondida unit cash costs declined by 13 per cent as the operation benefited from significant productivity
improvements, which included a 14 per cent increase in truck utilisation.

Escondida unit costs (US$ million)                             H1 FY15                      H1 FY14                    FY14

Revenue                                                          3,720                        4,277                   8,085

Underlying EBITDA                                                2,127                        2,562                   4,754

Cash costs (gross)                                               1,593                        1,715                   3,331

Less: freight                                                       61                           70                     139

Less: treatment and refining charges                               211                          156                     341

Cash costs (net)(i)                                              1,321                        1,489                   2,851

Sales (kt, equity share)(ii)                                       563                          553                   1,116

Sales (Mlb, equity share)(ii)                                    1,241                        1,219                   2,460

Cash cost per pound (US$)                                         1.06                         1.22                    1.16

(i) Royalties are reported within taxation expense.
(ii)Sales volumes adjusted to exclude intercompany sales and purchases.


An increase in non-cash charges reduced Underlying EBIT by US$442 million and reflected a lower
capitalisation rate for deferred stripping at Escondida and Pampa Norte, consistent with mine plans. Lower
volumes and average realised prices at Antamina contributed to a reduction in our share of profit after tax
from equity accounted investments which reduced Underlying EBIT by a further US$170 million.

The Escondida Oxide Leach Area Project was successfully completed during the December 2014 half year
on revised schedule and budget. The Escondida Organic Growth Project 1 (OGP1) remains on schedule to
commence first production in the first half of the 2015 calendar year and will create 152 kt per day of
valuable copper concentrator capacity. Following the commissioning of OGP1, we have the option to
extend the life of the Los Colorados concentrator enabling the utilisation of three concentrators. The
Escondida Water Supply project, which is on schedule for commissioning in the 2017 calendar year, is a
critical component of our three concentrator strategy as we balance increasing water requirements with our
commitment to ensure sustainable use of aquifers.

Financial information for the Copper Business for the December 2014 and December 2013 half years is
presented below.

Half year ended                                                                       Net
31 December 2014                              Underlying             Underlying operating     Capital  Exploration     Exploration to
US$ million                         Revenue       EBITDA       D&A         EBIT    assets expenditure        gross             profit

Escondida(i)                          3,720        2,127       418        1,709    12,862       1,671
Pampa Norte(ii)                         794          447       222          225     2,400          95
Antamina(iii)                           467          250        52          198     1,391         101
Cannington                              486          191        29          162       192          14
Olympic Dam                             797          138       132            6     6,408         131
Other(iii)(iv)                            -          (58)        4          (62)      (26)          -
Total Copper from
Group production                      6,264        3,095       857        2,238    23,227       2,012
Third party products                    470           11         -           11         -           -
Total Copper                          6,734        3,106       857        2,249    23,227       2,012           45                45
Statutory adjustments(v)               (467)         (94)      (53)         (41)        -        (101)          (1)               (1)
Total Copper
statutory result                      6,267        3,012       804        2,208    23,227       1,911           44                44



Half year ended                                                                        Net
31 December 2013                              Underlying              Underlying operating     Capital  Exploration     Exploration to
US$ million                         Revenue       EBITDA       D&A          EBIT    assets expenditure        gross             profit

Escondida(i)                          4,277        2,562       322         2,240    11,021       1,560
Pampa Norte(ii)                         835          333       179           154     2,651         199
Antamina(iii)                           774          535        44           491     1,412         148
Cannington                              605          277        21           256       244          32
Olympic Dam                             758          108       130           (22)    6,499          71
Other(iii)(iv)                           74          (49)        3           (52)      (47)          8
Total Copper from
Group production                      7,323        3,766       699         3,067    21,780       2,018
Third party products                    541            3         -             3         -           -
Total Copper                          7,864        3,769       699         3,070    21,780       2,018           74                74
Statutory adjustments(v)               (774)        (225)      (44)         (181)        -        (148)          (2)               (2)
Total Copper
statutory result                      7,090        3,544       655         2,889    21,780       1,870           72                72

(i)  Escondida is consolidated under IFRS 10 and reported on a 100 per cent basis.
(ii) Includes Spence and Cerro Colorado.
(iii)Antamina and Resolution are equity accounted investments and are reported on a proportionate consolidation basis (with the
     exception of net operating assets).
(iv) Predominantly comprises divisional activities, greenfield exploration, business development and ceased and sold operations.
     Includes Pinto Valley and Resolution. Pinto Valley was sold effective 11 October 2013.
(v)  Includes statutory adjustments for Antamina and Resolution to reconcile the proportionately consolidated business total to the
     statutory result. Statutory Underlying EBIT includes net finance costs and taxation expense of US$41 million (2013: net finance
     costs and taxation expense of US$181 million).


Iron Ore

Iron ore production increased by 16 per cent in the December 2014 half year to a record 113 Mt. Western
Australia Iron Ore (WAIO) production increased by 15 per cent to a record 124 Mt (100 per cent basis) as
the ramp-up of Jimblebar continued and we improved the availability, utilisation and rate of our integrated
supply chain. WAIO also achieved record sales volumes of 126 Mt (100 per cent basis) as our strategy of
increasing the percentage of direct to ship ore unlocks further port capacity. Samarco production increased
by 29 per cent to a record 14 Mt (100 per cent basis) as the ramp-up of the fourth pellet plant continues to
plan.

Total iron ore production guidance for the 2015 financial year remains unchanged at 225 Mt. Our WAIO
business continues to perform strongly and we have maintained production guidance of 245 Mt (100 per
cent basis) for the 2015 financial year.

Underlying EBIT for the December 2014 half year decreased by US$2.3 billion to US$4.2 billion. Lower
average realised prices reduced Underlying EBIT by US$4.3 billion, net of price-linked costs. In contrast,
record sales volumes and a substantial reduction in controllable cash costs increased Underlying EBIT by
US$1.2 billion and US$727 million, respectively. In this context, WAIO reduced its unit cash costs by 29 per
cent to US$20.35 per tonne as the operation benefited from economies of scale, a reduction in overhead,
contractor, labour and maintenance costs and a stronger US dollar. As a result of these substantial gains,
WAIO is well placed to achieve its targeted reduction in unit costs to below US$20 per tonne(12) ahead of
schedule.

WAIO unit costs (US$ million)                                    H1 FY15                         H1 FY14                  FY14
Revenue                                                            8,193                          10,786                20,883

Underlying EBITDA                                                  4,778                           6,787                12,966

Cash costs (gross)                                                 3,415                           3,999                 7,917

Less: freight                                                        658                             625                 1,274

Less: royalties                                                      554                             744                 1,497

Cash costs (net)                                                   2,203                           2,630                 5,146

Sales (kt, equity share)                                         108,245                          91,327               190,843

Cash cost per tonne (US$)                                          20.35                           28.80                 26.96


The tie-in of shiploader 2 at WAIO was successfully completed in January 2015. There are currently no
major projects in execution at WAIO and further growth in supply chain capacity to 270 Mtpa (100 per cent
basis) is expected to be achieved without the need for additional fixed plant investment. Beyond that, the
Inner Harbour Debottlenecking and Jimblebar Phase 2 projects(13) have the potential to increase total
capacity to 290 Mtpa (100 per cent basis) by the end of the 2017 financial year at very low capital cost.

Financial information for the Iron Ore business for the December 2014 and December 2013 half years is
presented below.


Half year ended                                                                               Net
31 December 2014                                   Underlying                Underlying operating     Capital  Exploration   Exploration to
US$ million                             Revenue        EBITDA         D&A          EBIT    assets expenditure        gross           profit

Western Australia Iron Ore                8,193         4,778         791         3,987    23,289       1,090
Samarco(i)                                  828           420          54           366     1,036         165
Other(ii)                                    73             4           1             3       108          14
Total Iron Ore from
Group production                          9,094         5,202         846         4,356    24,433       1,269
Third party products(iii)                   152            (5)          -            (5)        -           -
Total Iron Ore                            9,246         5,197         846         4,351    24,433       1,269           71               16
Statutory adjustments(iv)                  (828)         (205)        (54)         (151)        -        (165)           -                -
Total Iron Ore
statutory result                          8,418         4,992         792         4,200    24,433       1,104           71               16


  
Half year ended                                                                               Net
31 December 2013                                   Underlying                Underlying operating      Capital  Exploration    Exploration to
US$ million                             Revenue        EBITDA         D&A          EBIT    assets  expenditure        gross            profit

Western Australia
Iron Ore(v)                              10,786         6,787         585         6,202    22,350        1,711
Samarco(i)                                  845           458          32           426       901          287
Other(ii)(v)                                 63           (22)          1           (23)      195            -
Total Iron Ore from
Group production                         11,694         7,223         618         6,605    23,446        1,998
Third party products(iii)                   143            39           -            39         -            -
Total Iron Ore                           11,837         7,262         618         6,644    23,446        1,998           78               57
Statutory adjustments(iv)                  (845)         (177)        (32)         (145)        -         (287)           -                -
Total Iron Ore
statutory result                         10,992         7,085         586         6,499    23,446        1,711           78               57

(i)  Samarco is an equity accounted investment and is reported on a proportionate consolidation basis (with the exception of net
     operating assets).
(ii) Predominantly comprises divisional activities, towage services, business development and ceased operations.
(iii)Includes inter-segment and external sales of contracted gas purchases.
(iv) Includes statutory adjustments for Samarco to reconcile the proportionately consolidated business total to the statutory result.
     Statutory Underlying EBIT includes net finance costs and taxation expense of US$151 million (2013: net finance costs and
     taxation expense of US$145 million).
(v)  Comparative period has been restated to reallocate towage services from West Australia Iron Ore to Other.


Coal

Metallurgical coal production increased by 21 per cent in the December 2014 half year to a record 26 Mt.
Queensland Coal delivered record production and sales volumes primarily as a result of increased
equipment utilisation and the successful ramp-up of the Caval Ridge mine. Illawarra Coal also achieved
record production of 4.7 Mt in the December 2014 half year as maintenance efficiencies supported higher
equipment utilisation rates.

Energy coal production decreased by three per cent in the December 2014 half year to 36 Mt. As
anticipated, drought conditions constrained production volumes at Cerrejón given the need to manage dust
emissions, while Navajo Coal production declined following lower customer demand arising from the
closure of three of the five power units at the Four Corners Power Plant. New South Wales Energy Coal
production also declined as a result of processing lower-yield coal during the period and an additional
planned wash-plant outage. At South Africa Energy Coal, higher wash-plant utilisation contributed to a 10
per cent increase from the December 2013 half year which was affected by industrial action.

Metallurgical coal production guidance for the 2015 financial year remains unchanged at 47 Mt ahead of
the wet season and planned longwall moves at the Crinum, Dendrobium and West Cliff underground
mines. Energy coal production guidance for the 2015 financial year remains unchanged at 73 Mt.

Underlying EBIT for the December 2014 half year declined by US$332 million to US$178 million. Lower
average realised prices reduced Underlying EBIT by US$715 million, net of price-linked costs, although this
was partially offset by a stronger US dollar which increased Underlying EBIT by US$156 million.

A reduction in controllable cash costs increased Underlying EBIT by US$252 million during the period. At
Queensland Coal, unit cash costs declined by 15 per cent to US$70.75 per tonne as the operation
benefited from increased equipment and wash-plant utilisation rates and a continued focus on labour,
contractor and maintenance productivity.

Queensland Coal unit costs (US$ million)                    H1 FY15                   H1 FY14                    FY14
Revenue                                                       2,251                     2,397                   4,666

Underlying EBITDA                                               478                       614                     949

Cash costs (gross)                                            1,773                     1,783                   3,717

Less: freight                                                   111                       121                     237

Less: royalties                                                 146                       173                     331

Cash costs (net)                                              1,516                     1,489                   3,149

Sales (kt, equity share)                                     21,428                    17,973                  37,461

Cash cost per tonne (US$)                                     70.75                     82.85                   84.06

On 12 January 2015, the BMA Hay Point Stage Three Expansion project loaded first coal on revised
schedule and budget. The Appin Area 9 project remains on schedule and budget.

Financial information for the Coal Business for the December 2014 and December 2013 half years is
presented below.


Half year ended                                                                       Net
31 December 2014                               Underlying           Underlying  operating      Capital Exploration    Exploration to
US$ million                         Revenue        EBITDA     D&A         EBIT     assets  expenditure       gross            profit

Queensland Coal                       2,251           478     331          147      9,450          369
Illawarra(i)                            425           132     101           31      1,534          180
Energy Coal South Africa(i)             683            93      94           (1)     1,014           58
New Mexico                              298            86      23           63        250           13
New South Wales Energy Coal(i)          640           136      78           58      1,419          108
Colombia(i)                             383           121      56           65        938           54
Other(ii)                                 -           (64)      1          (65)       174            8
Total Coal from Group production      4,680           982     684          298     14,779          790
Third party products                     69             8       -            8          5            -
Total Coal                            4,749           990     684          306     14,784          790          14                14
Statutory adjustments(iii)             (452)         (201)    (73)        (128)         -          (75)          -                 -
Total Coal
statutory result                      4,297           789     611          178     14,784          715          14                14



Half year ended                                                                       Net
31 December 2013                              Underlying            Underlying  operating      Capital Exploration    Exploration to
US$ million                         Revenue       EBITDA     D&A          EBIT     assets  expenditure       gross            profit

Queensland Coal                       2,397          614     242          372       9,025        1,073
Illawarra(i)                            410           68      78          (10)      1,313          171
Energy Coal South Africa(i)             639           65      98          (33)      1,313           29
New Mexico                              278           52      23           29         132           15
New South Wales Energy Coal(i)          704          223      72          151       1,446          108
Colombia(i)                             443          171      42          129       1,015           88
Other(ii)                                 -          (67)      -          (67)        147           30
Total Coal from Group production      4,871        1,126     555          571      14,391        1,514
Third party products                    317           22       -           22          29            -
Total Coal                            5,188        1,148     555          593      14,420        1,514          19               19
Statutory adjustments(iii)             (443)        (139)    (56)         (83)          -         (107)         (1)              (1)
Total Coal
statutory result                      4,745        1,009     499          510      14,420        1,407          18               18

(i)  Cerrejon, Newcastle Coal Infrastructure Group, Port Kembla Coal Terminal and Richards Bay Coal Terminal are equity
     accounted investments and are reported on a proportionate consolidation basis (with the exception of net operating assets).
(ii) Predominantly comprises divisional activities and greenfield projects.
(iii)Includes statutory adjustments for Cerrejon, Newcastle Coal Infrastructure Group, Port Kembla Coal Terminal and Richards
     Bay Coal Terminal to reconcile the proportionately consolidated business total to the statutory result. Statutory Underlying EBIT
     includes net finance income and taxation expense of US$77 million (2013: net finance income and taxation expense of US$41
     million).


Aluminium, Manganese and Nickel

Alumina production was broadly unchanged in the December 2014 half year at 2.6 Mt and included record
production at the Alumar refinery. Worsley achieved record production in the December 2014 quarter as it
recovered from a series of calciner outages in the prior period. Aluminium production decreased by 16 per
cent in the December 2014 half year to 517 kt as the suspension of smelter capacity at Alumar and
cessation of smelting activities at Bayside during the 2014 financial year more than offset record production
at Mozal.

Manganese ore production increased by seven per cent in the December 2014 half year to a record 4.6 Mt
as an improvement in ore recovery at Mamatwan and an increase in plant availability at Wessels
underpinned record production at Hotazel. Manganese alloy production increased by 23 per cent in the
December 2014 half year, supported by increased smelter stability and availability at both TEMCO and
Metalloys.

Nickel production declined by 11 per cent in the December 2014 half year to 70 kt. Lower volumes reflected
the closure of the Perseverance underground mine at Nickel West in November 2013 and lower grades and
recoveries at Cerro Matoso. Nickel West and Cerro Matoso production guidance for the 2015 financial year
remains unchanged at 95 kt and 43 kt, respectively. Approximately 55 per cent of Nickel West production is
expected to be sourced from third party feed.

Underlying EBIT for the December 2014 half year increased by US$568 million to US$716 million. Higher
average realised prices for alumina, aluminium and nickel, net of price-linked costs, and a stronger US
dollar increased Underlying EBIT by US$368 million and US$170 million, respectively. A reduction in
controllable cash costs increased Underlying EBIT by a further US$51 million and reflected a continued
focus on labour and contractor productivity.

On 12 November 2014, the Group announced that the review of its Nickel West business was complete
and the preferred option, the sale of the business, was not achieved on an acceptable basis. As a result of
operational decisions made subsequent to the conclusion of this process, an impairment charge of US$290
million (after tax benefit) was recognised in the December 2014 half year as an exceptional item. At this
time, Nickel West remains in the BHP Billiton portfolio and the Company continues to operate the business
to maximise production, reduce operating costs and increase free cash flow.

In contemplation of the proposed demerger, BHP Billiton and Anglo American agreed to make certain
changes to the agreement which governs their interests in the Manganese business. Subject to obtaining
the required approvals for the agreement, the changes will result in BHP Billiton and Anglo American
agreeing to share joint control of the Manganese business. BHP Billiton will discontinue consolidation of the
Manganese business and account for its 60 per cent interest as an equity accounted joint venture. BHP
Billiton will therefore derecognise the existing carrying amounts of all assets, liabilities and the non-
controlling interest in the Manganese business attributed to Anglo American and initially record its retained
60 per cent interest at fair value. The remeasurement at fair value will give rise to an estimated gain of
approximately US$2 billion. There are no tax consequences arising from the remeasurement of the
Manganese business.

Financial information for the Aluminium, Manganese and Nickel Business for the December 2014 and
December 2013 half years is presented below.

Half year ended                                                                        Net
31 December 2014                              Underlying              Underlying operating     Capital  Exploration   Exploration to
US$ million                         Revenue       EBITDA        D&A         EBIT    assets expenditure        gross           profit

Alumina                                 860          227        106          121     4,187          30
Aluminium                             1,222          384         61          323     2,037          17
Intra-divisional adjustment            (332)           -          -            -         -           -
                                      1,750          611        167          444     6,224          47
Manganese                               952          294         89          205     1,693          94
Nickel West                             792           71         65            6        80          55
Cerro Matoso                            340          113         27           86       854          18
Other(i)                                  -          (40)         2          (42)       80           -
Total Aluminium, Manganese and
Nickel from Group production          3,834        1,049        350          699     8,931         214
Third party products                    359           17          -           17         -           -
Total Aluminium, Manganese and
Nickel                                4,193        1,066        350          716     8,931         214          24               20



Half year ended                                                                        Net
31 December 2013                              Underlying              Underlying operating     Capital  Exploration   Exploration to
US$ million                         Revenue       EBITDA        D&A         EBIT    assets expenditure        gross           profit
 
Alumina                                 699          133         95           38     3,578          22
Aluminium                             1,219          101         62           39     2,364          16
Intra-divisional adjustment            (342)           -          -            -         -           -
                                      1,576          234        157           77     5,942          38
Manganese                             1,027          302         66          236     1,686          90
Nickel West                             761          (94)        57         (151)      598          88
Cerro Matoso                            315           43         42            1       937          34
Other(i)                                  -          (29)         1          (30)       76           -
Total Aluminium, Manganese and
Nickel from Group production          3,679          456        323          133     9,239         250
Third party products                    481           15          -           15         -           -
Total Aluminium, Manganese and
Nickel                                4,160          471        323          148     9,239         250          28               25
(i)   Predominantly comprises divisional activities and business development.


The financial report on pages 29 to 51 has been prepared in accordance with IFRS. This news release including the
financial report is unaudited. Variance analysis relates to the relative financial and/or production performance of BHP
Billiton and/or its operations during the December 2014 half year compared with the December 2013 half year, unless
otherwise noted.

The following abbreviations may have been used throughout this report: barrels (bbl); billion cubic feet (bcf); barrels of
oil equivalent (boe); cost and freight (CFR); cost, insurance and freight (CIF), dry metric tonne unit (dmtu); free on
board (FOB); grams per tonne (g/t); kilograms per tonne (kg/t); kilometre (km); metre (m); million barrels of oil
equivalent (MMboe); thousand cubic feet equivalent (Mcfe); million cubic feet per day (MMcf/d); million pounds (Mlb;
million tonnes (Mt); million tonnes per annum (Mtpa); ounces (oz); pounds (lb); thousand barrels of oil equivalent
(Mboe); thousand ounces (koz); thousand standard cubic feet (Mscf); thousand tonnes (kt); thousand tonnes per
annum (ktpa); thousand tonnes per day (ktpd); tonnes (t); and wet metric tonnes (wmt).

The following footnotes apply to this profit release:
(1) Underlying attributable profit, Underlying EBIT and Underlying EBITDA are used to reflect the underlying
    performance of BHP Billiton. Underlying attributable profit is Attributable profit excluding any exceptional items.
    Underlying EBIT is earnings before net finance costs, taxation and any exceptional items. Underlying EBITDA is
    Underlying EBIT before depreciation, impairments and amortisation of US$5,268 million for the half year ended
    31 December 2014 and US$4,136 million for the half year ended 31 December 2013. We believe that Underlying
    attributable profit, Underlying EBIT and Underlying EBITDA provide useful information, but should not be
    considered as an indication of, or as an alternative to, Attributable profit as an indicator of actual operating
    performance or as an alternative to cash flow as a measure of liquidity.
    Underlying EBIT includes net finance costs and taxation expense related to equity accounted investments of
    US$269 million (2013: US$367 million).
    Underlying EBITDA includes depreciation, impairments and amortisation related to equity accounted investments
    of US$182 million (2013: US$134 million).
(2) Non-IFRS measures are defined as follows:
    - Adjusted effective tax rate – comprises Total taxation expense excluding remeasurement of deferred tax
      assets associated with the Minerals Resource Rent Tax (MRRT), exceptional items and exchange rate
      movements included in taxation expense divided by Profit before taxation and exceptional items.
    - Free cash flow – comprises net operating cash flows less net investing cash flows.
    - Net debt – comprises Interest bearing liabilities less Cash and cash equivalents.
    - Net operating assets – represents operating assets net of operating liabilities including the carrying value of
      equity accounted investments and predominantly excludes cash balances, interest bearing liabilities and
      deferred tax balances. The carrying value of investments accounted for using the equity accounted method
      represents the balance of the Group’s investment in equity accounted investments, with no adjustment for any
      cash balances, interest bearing liabilities and deferred tax balances of the equity accounted investment.
    - Underlying attributable profit – comprises Profit after taxation attributable to members of BHP Billiton Group
      less exceptional items as described in note 3 to the financial report.
    - Underlying basic earnings per share – represents basic earnings per share excluding any exceptional items.
    - Underlying EBIT margin – comprises Underlying EBIT excluding third party product profit from operations,
      divided by revenue excluding third party product revenue.
    - Underlying EBITDA interest coverage – for the purpose of deriving interest coverage, net interest comprises
      Interest on bank loans and overdrafts, Interest on all other borrowings, Finance lease and hire purchase
      interest less Interest income.
    - Underlying EBITDA margin – comprises Underlying EBITDA excluding third party product EBITDA, divided by
      revenue excluding third party product revenue.
    - Underlying return on capital – represents net profit after tax, excluding exceptional items and net finance costs
      (after tax), divided by average capital employed. Capital employed is net assets before net debt.
(3) Represents productivity-led volume efficiencies, operating cash cost efficiencies and exploration and business
    development savings. Productivity-led volume efficiencies refer to volume increases, excluding volume increases
    from major capital projects, multiplied by the prior period EBIT margin. Operating cash cost efficiencies refer to
    the reduction in costs, excluding the impact of volume, price-linked costs, exchange rates, inflation, fuel and
    energy, non-cash costs, one-off items, ceased and sold operations and other items. Exploration and business
    development savings refers to the reduction in total exploration and business development costs including
    capitalised exploration.
(4) Represents planned annualised volume and cost productivity gains to be delivered from our core portfolio only,
    relative to the 2014 financial year. Core portfolio includes: Western Australia Iron Ore, Samarco, Queensland
    Coal, NSW Energy Coal, Cerrejón, Escondida, Olympic Dam, Pampa Norte, Antamina, Onshore US, Shenzi, Mad
    Dog, Atlantis, Angostura, North West Shelf, Bass Strait, Pyrenees, Macedon and the Jansen project.
(5) Represents the share of capital and exploration expenditure attributable to BHP Billiton shareholders on a cash
    basis. Includes BHP Billiton proportionate share of equity accounted investments; excludes capitalised deferred
    stripping and non-controlling interests. Capitalised deferred stripping of US$1.0 billion to US$1.3 billion (BHP
    Billiton share) expected in the 2015 and 2016 financial years.
(6) Ungeared, post tax, nominal rate of return for our future investments; valuation date 1 January 2015.
(7) Underlying payout ratio – represents dividends and buy-backs, divided by Underlying attributable profit.
(8) Refers to copper equivalent production based on average realised prices for the 2013 financial year.
(9) 17,687 square kilometres 3D seismic acquisition completed over Trinidad and Tobago Blocks 5, 6, 14, 23a, 23b,
    28 and 29.
(10)3,528 square kilometres 3D seismic acquisition in progress over Trinidad and Tobago Blocks 3 and 7.
(11)Excludes Pinto Valley which was sold during the 2014 financial year.
(12)Unit cash cost target based on real 2014 terms, AUD:USD exchange rate of 0.91.
(13)Subject to Board approval.

Forward looking statements

This release contains forward-looking statements, including statements regarding: trends in commodity prices and
currency exchange rates; demand for commodities; plans, strategies and objectives of management; closure or
divestment of certain operations or facilities (including associated costs); anticipated production or construction
commencement dates; capital costs and scheduling; operating costs and shortages of materials and skilled
employees; anticipated productive lives of projects, mines and facilities; provisions and contingent liabilities; tax and
regulatory developments.

Forward-looking statements can be identified by the use of terminology such as ‘intend’, ‘aim’, ‘project’, ‘anticipate’,
‘estimate’, ‘plan’, ‘believe’, ‘expect’, ‘may’, ‘should’, ‘will’, ‘continue’, ‘annualised’ or similar words. These statements
discuss future expectations concerning the results of operations or financial condition, or provide other forward-looking
statements.

These forward-looking statements are not guarantees or predictions of future performance, and involve known and
unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual
results to differ materially from those expressed in the statements contained in this release. Readers are cautioned not
to put undue reliance on forward-looking statements.

For example, our future revenues from our operations, projects or mines described in this release will be based, in
part, upon the market price of the minerals, metals or petroleum produced, which may vary significantly from current
levels. These variations, if materially adverse, may affect the timing or the feasibility of the development of a particular
project, the expansion of certain facilities or mines, or the continuation of existing operations.

Other factors that may affect the actual construction or production commencement dates, costs or production output
and anticipated lives of operations, mines or facilities include our ability to profitably produce and transport the
minerals, petroleum and/or metals extracted to applicable markets; the impact of foreign currency exchange rates on
the market prices of the minerals, petroleum or metals we produce; activities of government authorities in some of the
countries where we are exploring or developing these projects, facilities or mines, including increases in taxes,
changes in environmental and other regulations and political uncertainty; labour unrest; and other factors identified in
the risk factors discussed in BHP Billiton’s filings with the U.S. Securities and Exchange Commission (the “SEC”)
(including in Annual Reports on Form 20-F) which are available on the SEC’s website at www.sec.gov.

Except as required by applicable regulations or by law, the Group does not undertake any obligation to publicly update
or review any forward-looking statements, whether as a result of new information or future events.

Non-IFRS financial information

BHP Billiton results are reported under International Financial Reporting Standards (IFRS) including Underlying EBIT
and Underlying EBITDA which are used to measure segment performance. This release may also include certain non-
IFRS measures including Adjusted effective tax rate, Free cash flow, Net debt, Net operating assets, Underlying
attributable profit, Underlying basic earnings per share, Underlying EBIT margin, Underlying EBITDA interest
coverage, Underlying EBITDA margin, and Underlying return on capital. These measures are used internally by
management to assess the performance of our business, make decisions on the allocation of our resources and
assess operational management. Non-IFRS measures have not been subject to audit or review and should not be
considered as an indication of or alternative to an IFRS measure of profitability, financial performance or liquidity.

No offer of securities

Nothing in this release should be construed as either an offer to sell or a solicitation of an offer to buy or sell BHP
Billiton securities or securities in the new company (if the demerger is implemented) in any jurisdiction, or be treated or
relied upon as a recommendation or advice by BHP Billiton.

Reliance on third party information

The views expressed in this release contain information that has been derived from publicly available sources that
have not been independently verified. No representation or warranty is made as to the accuracy, completeness or
reliability of the information. This release should not be relied upon as a recommendation or forecast by BHP Billiton.

No financial or investment advice – South Africa

BHP Billiton does not provide any financial or investment 'advice' as that term is defined in the South African Financial
Advisory and Intermediary Services Act, 37 of 2002, and we strongly recommend that you seek professional advice.


Sponsor: Merrill Lynch South Africa Proprietary Limited


Further information on BHP Billiton can be found on our website: www.bhpbilliton.com

Media Relations                                            Investor Relations
Australia                                                  Australia

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email: Eleanor.Nichols@bhpbilliton.com                     Jonathan Price
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email: Jennifer.White@bhpbilliton.com                      James Agar
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Ruban Yogarajah                                            Joseph Suarez
Tel: +44 20 7802 4033 Mobile: +44 7827 082 022             Tel: +1 212 310 1422 Mobile: +1 646 400 3803
email: Ruban.Yogarajah@bhpbilliton.com                     email: Joseph.Suarez@bhpbilliton.com

BHP Billiton Limited ABN 49 004 028 077                    BHP Billiton Plc Registration number 3196209
Registered in Australia                                    Registered in England and Wales
Registered Office: Level 16, 171 Collins Street            Registered Office: Neathouse Place
Melbourne Victoria 3000 Australia                          London SW1V 1LH United Kingdom
Tel +61 1300 55 4757 Fax +61 3 9609 3015                   Tel +44 20 7802 4000 Fax +44 20 7802 4111

                     Members of the BHP Billiton Group which is headquartered in Australia


BHP Billiton Group

Financial Report

For the half year ended 31 December 2014

Contents

Half Year Financial Statements                                                                      Page
Consolidated Income Statement                                                                         33
Consolidated Statement of Comprehensive Income                                                        34
Consolidated Balance Sheet                                                                            35
Consolidated Cash Flow Statement                                                                      36
Consolidated Statement of Changes in Equity                                                           37
Notes to the Half Year Financial Statements                                                           40
1. Accounting policies                                                                                40
2. Segment reporting                                                                                  41
3. Exceptional items                                                                                  43
4. Interests in associates and joint venture entities                                                 44
5. Net finance costs                                                                                  44
6. Taxation                                                                                           45
7. Earnings per share                                                                                 45
8. Dividends                                                                                          46
9. Financial risk management – Fair values                                                            47
10. Significant events                                                                                52
11. Subsequent events                                                                                 53
Directors’ Report                                                                                     54
Directors’ Declaration of Responsibility                                                              56
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001               58
Independent Review Report                                                                             59

Consolidated Income Statement
for the half year ended 31 December 2014

                                                  Notes     Half year ended  Half year ended    Year ended
                                                                     31 Dec           31 Dec       30 June
                                                                       2014             2013          2014
                                                                       US$M             US$M          US$M

Revenue
Group production                                                     28,866           32,209        64,227
Third party products                                                  1,034            1,739         2,979
Revenue                                               2              29,900           33,948        67,206
Other income                                                            441              973         1,524
Expenses excluding net finance costs                                (21,862)         (22,674)      (46,513)
Share of operating profit of equity accounted
investments                                           4                 338              686         1,195
Profit from operations                                                8,817           12,933        23,412    

Comprising:
 Group production                                                     8,786           12,848        23,368
 Third party products                                                    31               85            44
                                                                      8,817           12,933        23,412

Financial expenses                                                     (292)            (589)       (1,273)
Financial income                                                         60               61            97
Net finance costs                                     5                (232)            (528)       (1,176)

Profit before taxation                                                8,585           12,405        22,236

Income tax expense                                                   (2,848)          (3,692)       (6,538)
Royalty related taxation (net of income tax
benefit)                                                               (944)             174          (474)
Total taxation expense                                6              (3,792)          (3,518)       (7,012)

Profit after taxation                                                 4,793            8,887        15,224
  Attributable to non-controlling interests                             528              780         1,392
  Attributable to members of BHP Billiton Group                       4,265            8,107        13,832

Basic earnings per ordinary share (cents)             7                80.2            152.4         260.0
Diluted earnings per ordinary share (cents)           7                80.0            151.9         259.1

Dividends per ordinary share – paid during the
period (cents)                                        8                62.0             59.0         118.0
Dividends per ordinary share – determined in
respect of the period (cents)                         8                62.0             59.0         121.0

The accompanying notes form part of these half year financial statements.

Consolidated Statement of Comprehensive Income
for the half year ended 31 December 2014
                                                                  Half year        Half year    Year ended
                                                                      ended            ended       30 June
                                                                31 Dec 2014      31 Dec 2013          2014
                                                                       US$M             US$M          US$M

Profit after taxation                                                 4,793            8,887        15,224
Other comprehensive income
Items that may be reclassified subsequently to the income
statement:
Available for sale investments:
   Net valuation losses taken to equity                                 (19)              (8)          (15)
   Net valuation gains transferred to the income statement               (1)              (2)          (14)
Cash flow hedges: 
   (Losses)/gains taken to equity                                    (1,296)             647           681
   Losses/(gains) transferred to the income statement                 1,283             (631)         (678)
Exchange fluctuations on translation of foreign operations taken
to equity                                                                (2)              (2)           (1)
Tax recognised within other comprehensive income                          6               (5)            3
Total items that may be reclassified subsequently to the income
statement                                                               (29)              (1)          (24)

Items that will not be reclassified to the income statement:
Actuarial (losses)/gains on pension and medical schemes                 (29)              99            57
Tax recognised within other comprehensive income                         13                7            12
Total items that will not be reclassified to the income statement       (16)             106            69

Total other comprehensive (loss)/income                                 (45)             105            45

Total comprehensive income                                            4,748            8,992        15,269
  Attributable to non-controlling interests                             533              781         1,392
  Attributable to members of BHP Billiton Group                       4,215            8,211        13,877

The accompanying notes form part of these half year financial statements.

Consolidated Balance Sheet
as at 31 December 2014
                                                                     31 Dec          30 June        31 Dec
                                                                       2014             2014          2013
                                                                       US$M             US$M          US$M

ASSETS
Current assets
Cash and cash equivalents                                             6,130            8,803        10,947
Trade and other receivables                                           5,584            6,741         6,698
Other financial assets                                                   81               87           152
Inventories                                                           6,149            6,013         5,917
Current tax assets                                                      630              318           289
Other                                                                   327              334           595
Total current assets                                                 18,901           22,296        24,598
Non-current assets
Trade and other receivables                                           1,716            1,867         2,089
Other financial assets                                                2,150            2,349         2,268
Inventories                                                             476              463           713
Property, plant and equipment                                       108,771          108,787       105,254
Intangible assets                                                     5,289            5,439         5,533
Investments accounted for using the equity method                     3,550            3,664         3,635
Deferred tax assets                                                   5,080            6,396         6,801
Other                                                                   148              152           124
Total non-current assets                                            127,180          129,117       126,417
Total assets                                                        146,081          151,413       151,015

LIABILITIES
Current liabilities
Trade and other payables                                              8,338           10,145         9,734
Interest bearing liabilities                                          2,459            4,262         6,333
Other financial liabilities                                              14               16            23
Current tax payable                                                     407              919         1,596
Provisions                                                            1,943            2,504         2,135
Deferred income                                                         189              218           272
Total current liabilities                                            13,350           18,064        20,093
Non-current liabilities
Trade and other payables                                                 77              113           338
Interest bearing liabilities                                         28,610           30,327        31,702
Other financial liabilities                                             559              303         1,141
Deferred tax liabilities                                              7,493            7,066         7,036
Provisions                                                            9,467            9,891         8,118
Deferred income                                                         275              267           308
Total non-current liabilities                                        46,481           47,967        48,643
Total liabilities                                                    59,831           66,031        68,736
Net assets                                                           86,250           85,382        82,279

EQUITY
Share capital – BHP Billiton Limited                                  1,186            1,186         1,186
Share capital – BHP Billiton Plc                                      1,057            1,069         1,069
Treasury shares                                                        (230)            (587)         (605)
Reserves                                                              2,842            2,927         2,895
Retained earnings                                                    74,990           74,548        72,014
Total equity attributable to members of BHP Billiton 
Group                                                                79,845           79,143        76,559
Non-controlling interests                                             6,405            6,239         5,720
Total equity                                                         86,250           85,382        82,279

The accompanying notes form part of these half year financial statements.

Consolidated Cash Flow Statement
for the half year ended 31 December 2014
                                                                      Half year          Half year   Year ended
                                                                          ended              ended      30 June
                                                                    31 Dec 2014        31 Dec 2013         2014
                                                                           US$M               US$M         US$M
Operating activities
Profit before taxation                                                    8,585             12,405       22,236
Adjustments for:
  Non-cash or non-operating exceptional items                               409              (551)         (551)
  Depreciation and amortisation expense                                   4,907             3,993         8,701
  Net gain on sale of non-current assets                                    (34)              (4)           (95)
  Impairments of property, plant and equipment, financial assets and
  intangibles                                                               361               143           797
  Employee share awards expense                                             116               129           247
  Net finance costs                                                         232               528         1,176
  Share of operating profit of equity accounted investments                (338)             (686)       (1,195)
  Other                                                                     122              (107)          (83)
Changes in assets and liabilities:
  Trade and other receivables                                               960              (327)         (252)
  Inventories                                                              (191)             (209)          (54)
  Trade and other payables                                               (1,398)             (865)           77
  Net other financial assets and liabilities                                (18)               50           (49)
  Provisions and other liabilities                                         (770)              (87)          429
Cash generated from operations                                           12,943            14,412        31,384
Dividends received                                                            8                 9            34
Dividends received from equity accounted investments                        476               728         1,250
Interest received                                                            62                73           136
Interest paid                                                              (387)             (482)         (975)
Income tax refunded                                                         329               751           852
Income tax paid                                                          (2,147)           (3,069)       (6,445)
Royalty-related taxation refunded                                             –                 –           216
Royalty-related taxation paid                                              (861)             (563)       (1,088)
Net operating cash flows                                                 10,423            11,859        25,364
Investing activities
Purchases of property, plant and equipment                               (6,772)           (8,605)      (15,993)
Exploration expenditure                                                    (422)             (504)       (1,010)
Exploration expenditure expensed and included in operating cash flows       359               342           716
Purchase of intangibles                                                     (64)              (65)         (192)
Investment in financial assets                                              (31)             (390)       (1,193)
Investment in equity accounted investments                                  (25)              (17)          (44)
Cash outflows from investing activities                                  (6,955)           (9,239)      (17,716)
Proceeds from sale of property, plant and equipment                          47                41           114
Proceeds from financial assets                                              340               108           956
Proceeds from divestment of subsidiaries, operations and joint
operations, net of their cash                                               251               628           812
Net investing cash flows                                                 (6,317)           (8,462)      (15,834)
Financing activities
Proceeds from interest bearing liabilities                                  348             5,535         6,251
Proceeds from debt related instruments                                        –                 –            37
Repayment of interest bearing liabilities                                (3,197)           (1,474)       (7,198)
Proceeds from ordinary shares                                                 3                 9            14
Contributions from non-controlling interests                                 46             1,387         1,435
Purchase of shares by Employee Share ownership Plan (ESOP) Trusts          (338)             (290)         (368)
Dividends paid                                                           (3,209)           (3,227)       (6,387)
Dividends paid to non-controlling interests                                (412)             (101)         (252)
Net financing cash flows                                                 (6,759)            1,839        (6,468)
Net (decrease)/increase in cash and cash equivalents                     (2,653)            5,236         3,062
Cash and cash equivalents, net of overdrafts, at beginning of period      8,752             5,667         5,667
Foreign currency exchange rate changes on cash and cash
equivalents                                                                  19                 6            23
Cash and cash equivalents, net of overdrafts, at end of period            6,118            10,909         8,752

The accompanying notes form part of these half year financial statements.

Consolidated Statement of Changes in Equity
for the half year ended 31 December 2014
For the half year ended 31
December 2014
US$M                                                 Attributable to members of the BHP Billiton Group
                                           Share      Share    Treasury    Reserves     Retained    Total equity           Non-       Total
                                         capital    capital      shares                 earnings    attributable    controlling      equity
                                           – BHP      – BHP                                           to members      interests
                                        Billiton   Billiton                                               of BHP
                                         Limited        Plc                                             Billiton
                                                                                                           Group

Balance as at 1 July 2014                  1,186      1,069       (587)       2,927       74,548          79,143          6,239      85,382
Profit after taxation                          -          -          -            -        4,265           4,265            528       4,793
Other comprehensive income: 
Net valuation (losses)/gains on
available for sale investments taken to
equity                                         -          -          -          (25)           -             (25)             6         (19)
Net valuation gains on available for 
sale investments transferred to the  
income statement                               -          -          -           (1)           -              (1)             -          (1)
Losses on cash flow hedges taken to  
equity                                         -          -          -       (1,296)           -          (1,296)             -      (1,296)
Losses on cash flow hedges
transferred to the income statement            -          -          -        1,283            -           1,283              -       1,283
Exchange fluctuations on translation
of foreign operations taken to equity          -          -          -           (2)           -              (2)             -          (2)
Actuarial gains on pension and
medical schemes                                -          -          -            -          (29)            (29)             -         (29)
Tax recognised within other 
comprehensive income                           -          -          -            7           13              20             (1)         19
Total comprehensive income                     -          -          -          (34)       4,249           4,215            533       4,748
Transactions with owners:
Shares cancelled                               -        (12)       501           12         (501)              –              -           –
Purchase of shares by ESOP Trusts              -          -       (338)           -            -            (338)             -        (338)
Employee share awards exercised net
of employee contributions                      -          -        194         (174)         (18)              2              -           2
Employee share awards forfeited                -          -          -           (4)           4               -              -           –
Accrued employee entitlement for
unexercised awards                             -          -          -          116            -             116              -         116
Distribution to option holders                 -          -          -           (1)           -              (1)            (1)         (2)
Dividends                                      -          -          -            -       (3,292)         (3,292)          (412)     (3,704)
Equity contributed                             -          -          -            -            -               –             46          46
Balance as at 31 December 2014             1,186      1,057       (230)       2,842       74,990          79,845          6,405      86,250


The accompanying notes form part of these half year financial statements.

Consolidated Statement of Changes in Equity
for the half year ended 31 December 2014 (continued)
For the half year ended 31
December 2013
US$M
                                                   Attributable to members of the BHP Billiton Group
                                           Share       Share   Treasury     Reserves   Retained     Total equity           Non-       Total
                                         capital     capital     shares                earnings     attributable    controlling      equity
                                           – BHP       – BHP                                          to members      interests
                                        Billiton    Billiton                                              of BHP
                                         Limited         Plc                                            Billiton
                                                                                                           Group

Balance as at 1 July 2013                 1,186        1,069      (540)        1,970     66,982           70,667          4,624      75,291
Profit after taxation                         -            -         -             -      8,107            8,107            780       8,887
Other comprehensive income:
Net valuation losses on available for
sale investments taken to equity              -            -         -            (8)         -               (8)             -          (8)
Net valuation gains on available for
sale investments transferred to the
income statement                              -            -         -            (2)         -               (2)             -          (2)
Gains on cash flow hedges taken to
equity                                        -            -         -           647          -              647              -         647
Gains on cash flow hedges
transferred to the income statement           -            -         -          (631)         -             (631)             -        (631)
Exchange fluctuations on translation
of foreign operations taken to equity         -            -         -            (2)         -               (2)             -          (2)
Actuarial gains on pension and
medical schemes                               -            -         -             -         98               98              1          99
Tax recognised within other
comprehensive income                          -            -         -            (5)         7                2              -           2
Total comprehensive income                    -            -         -            (1)     8,212            8,211            781       8,992
Transactions with owners:
Purchase of shares by ESOP Trusts             -            -      (290)            -          -             (290)             -        (290)
Employee share awards exercised
net of employee contributions                 -            -       225          (151)       (68)               6              -           6
Employee share awards forfeited               -            -         -           (23)        23                -              -           -
Accrued employee entitlement for
unexercised awards                            -            -         -           129          -              129              -         129
Dividends                                     -            -         -             -     (3,135)          (3,135)          (101)     (3,236)
Equity contributed                            -            -         -           971          -              971            416       1,387
Balance as at 31 December 2013            1,186        1,069      (605)        2,895     72,014           76,559          5,720      82,279


The accompanying notes form part of these half year financial statements.

Consolidated Statement of Changes in Equity
for the half year ended 31 December 2014 (continued)
For the year ended 30 June 2014
US$M
                                                    Attributable to members of the BHP Billiton Group
                                          Share        Share   Treasury     Reserves   Retained            Total            Non-       Total
                                        capital      capital     shares                earnings           equity     controlling      equity
                                          – BHP        – BHP                                        attributable       interests
                                       Billiton     Billiton                                                  to
                                        Limited          Plc                                             members
                                                                                                          of BHP
                                                                                                        Billiton
                                                                                                           Group
Balance as at 1 July 2013                 1,186        1,069      (540)        1,970     66,982           70,667           4,624      75,291
Profit after taxation                         -            -         -             -     13,832           13,832           1,392      15,224
Other comprehensive income:
Net valuation losses on available for sale 
investments taken to equity                   -            -         -           (15)         -              (15)              -         (15)
investments transferred to the income
statement                                     -            -         -           (14)         -              (14)              -         (14)
Gains on cash flow hedges taken to
equity                                        -            -         -           681          -              681               -         681
Gains on cash flow hedges transferred to
the income statement                          -            -         -          (678)         -             (678)              -        (678)
Exchange fluctuations on translation of
foreign operations taken to equity            -            -         -            (1)         -               (1)              -          (1)
Actuarial gains on pension and medical
schemes                                       -            -         -             -         57               57               -          57
Tax recognised within other
comprehensive income                          -            -         -             3         12               15               -          15
Total comprehensive income                    -            -         -           (24)    13,901           13,877           1,392      15,269
Transactions with owners:
Purchase of shares by ESOP Trusts             -            -      (368)            -          -             (368)              -        (368)
Employee share awards exercised net of                                          (221)       (91)               9               -           9
employee contributions                        -            -       321
Employee share awards forfeited               -            -         -           (32)        32                -               -           -
Accrued employee entitlement for                                                 247          -              247               -         247
unexercised awards                            -            -         -
Distribution to option holders                -            -         -            (2)         -               (2)             (2)         (4)
Dividends                                     -            -         -             -     (6,276)          (6,276)           (252)     (6,528)
Equity contributed                            -            -         -           989          -              989             477       1,466
Balance as at 30 June 2014                1,186        1,069      (587)        2,927     74,548           79,143           6,239      85,382



The accompanying notes form part of these half year financial statements.

Notes to the Half Year Financial Statements

1. Accounting policies
This general purpose financial report for the half year ended 31 December 2014 is unaudited and has been
prepared in accordance with IAS 34 “Interim Financial Reporting” as issued by the International Accounting
Standards Board (IASB), IAS 34 “Interim Financial Reporting” as adopted by the EU, AASB 134 “Interim
Financial Reporting” as issued by the Australian Accounting Standards Board (AASB) and the Disclosure
and Transparency Rules of the Financial Conduct Authority in the United Kingdom and the Australian
Corporations Act 2001 as applicable to interim financial reporting.

The half year financial statements represent a “condensed set of financial statements” as referred to in the
UK Disclosure and Transparency Rules issued by the Financial Conduct Authority. Accordingly, they do not
include all of the information required for a full annual report and are to be read in conjunction with the most
recent annual financial report. The comparative figures for the financial year ended 30 June 2014 are not
the statutory accounts of the BHP Billiton Group for that financial year. Those accounts, which were
prepared under IFRS, have been reported on by the Company's auditor and delivered to the registrar of
companies. The auditor has reported on those accounts; the report was unqualified, did not include a
reference to any matters to which the auditors drew attention by way of emphasis without qualifying their
report and did not contain statements under Section 498(2) or (3) of the UK Companies Act 2006.

The half year financial statements have been prepared on the basis of accounting policies and methods of
computation consistent with those applied in the 30 June 2014 annual financial statements contained within
the Annual Report of the BHP Billiton Group, except for the adoption of:
    - IFRIC 21 “Levies” which confirms that a liability to pay a levy is only recognised when the activity that
      triggers the payment occurs; and
    - Amendments to IAS 32/AASB 132 “Financial Instruments: Presentation” which clarifies the criteria for
      offsetting financial assets and liabilities.
The adoption of IFRIC 21 and the amendments to IAS 32 did not have a material impact on BHP Billiton
Group and therefore no restatements have been made to the prior year financial statements.

Rounding of amounts

Amounts in this financial report have, unless otherwise indicated, been rounded to the nearest million
dollars.

Comparatives

Where applicable, comparatives have been restated to disclose them on the same basis as current period
figures.

Exchange rates

The following exchange rates relative to the US dollar have been applied in each reporting period:
                                    Average           Average     Average Year          As at         As at        As at
                            Half year ended         Half year            ended    31 Dec 2014   31 Dec 2013      30 June
                                31 Dec 2014            ended           30 June                                      2014
                                                 31 Dec 2013              2014
Australian dollar(i)                   0.89             0.92              0.92           0.82          0.89         0.94
Brazilian real                         2.40             2.28              2.29           2.66          2.34         2.20
Canadian dollar                        1.11             1.04              1.07           1.16          1.06         1.07
Chilean peso                            587              511               532            607           524          551
Colombian peso                        2,037            1,910             1,935          2,392         1,927        1,881
Euro                                   0.78             0.75              0.74           0.83          0.73         0.73
South African rand                    10.99            10.07             10.39          11.55         10.53        10.60
UK pound sterling                      0.61             0.63              0.62           0.64          0.61         0.59
(i) Displayed as US$ to A$1 based on common convention.

2. Segment reporting

The Group operates five businesses aligned with the commodities which we extract and market, reflecting
the structure used by the Group’s management to assess the performance of the Group.

Reportable segment                        Principal activities
Petroleum and Potash                      Exploration, development and production of oil and gas
                                          Potash pre-development
Copper                                    Mining of copper, silver, lead, zinc, molybdenum, uranium and gold
Iron Ore                                  Mining of iron ore
Coal                                      Mining of metallurgical coal and thermal (energy) coal
Aluminium, Manganese and Nickel           Mining of bauxite, refining of bauxite into alumina and smelting of alumina
                                          into aluminium metal
                                          Mining of manganese ore and production of manganese metal and alloys
                                          Mining and production of nickel products

Group and unallocated items includes Group Functions, unallocated operations and consolidation
adjustments. Exploration and technology activities are recognised within relevant segments.

It is the Group’s policy that inter-segment sales are made on a commercial basis.

2. Segment reporting (continued)
US$M                                Petroleum      Copper       Iron Ore      Coal     Aluminium,      Group and         BHP
                                          and                                          Manganese     unallocated    Billiton
                                       Potash                                         and Nickel          items/       Group
                                                                                                   eliminations
Half year ended 31 December 2014
Revenue
 Group production                       6,659       5,797          8,193     4,228         3,834               -      28,711
 Third party products                      44         470             65        69           359              27       1,034
 Rendering of services                     82           -             73         -             -               -         155
 Inter-segment revenue                    151           -             87         -             -            (238)          -
Total revenue(a)                        6,936       6,267          8,418     4,297         4,193            (211)     29,900
Underlying EBIT(b)                      2,144       2,208          4,200       178           716            (220)      9,226
Net finance costs(c)                                                                                                    (232)
Exceptional items(d)                                                                                                    (409)
Profit before taxation                                                                                                 8,585

Half year ended 31 December 2013
Revenue
 Group production                       6,648       6,549         10,786     4,428         3,679               -      32,090
 Third party products                     281         541             70       317           476              54       1,739
 Rendering of services                     56           -             63         -             -               -         119
 Inter-segment revenue                     86           -             73         -             5            (164)          -
Total revenue(a)                        7,071       7,090         10,992     4,745         4,160            (110)     33,948
Underlying EBIT(b)                      2,506       2,889          6,499       510           148            (170)     12,382
Net finance costs(c)                                                                                                    (528)
Exceptional items(d)                                                                                                     551
Profit before taxation                                                                                                12,405

Year ended 30 June 2014
Revenue
 Group production                      14,022      12,838         20,883     8,659         7,583               -      63,985
 Third party products                     437       1,030            130       456           823             103       2,979
 Rendering of services                    112           -            130         -             -               -         242
 Inter-segment revenue                    262           -            213         -             5            (480)          -
Total revenue(a)                       14,833      13,868         21,356     9,115         8,411            (377)     67,206
Underlying EBIT(b)                      5,287       5,080         12,102       386           307            (301)     22,861
Net finance costs(c)                                                                                                  (1,176)
Exceptional items(d)                                                                                                     551
Profit before taxation                                                                                                22,236
(a) Revenue not attributable to reportable segments comprises the sale of freight and fuel to third parties.
(b) Underlying EBIT is earnings before net finance costs, taxation expense and any exceptional items. Underlying EBIT is reported
    net of the Group’s share of net finance costs and taxation expense related to equity accounted investments.
(c) Refer to note 5 Net finance costs.
(d) Refer to note 3 Exceptional items.


3. Exceptional items
Half year ended 31 December 2014                                            Gross                     Tax             Net
                                                                             US$M                    US$M            US$M
Exceptional items by category
Repeal of Minerals Resource Rent Tax legislation                                -                    (809)           (809)
Impairment of Nickel West assets                                             (409)                    119            (290)
                                                                             (409)                   (690)         (1,099)

Repeal of Minerals Resource Rent Tax legislation:

On 2 September 2014, legislation to repeal the Minerals Resource Rent Tax (MRRT) in Australia received
the support of both Houses of Parliament and took effect on 30 September 2014. As a result, the Group
derecognised an MRRT deferred tax asset (net of income tax consequences) of US$809 million and a
corresponding taxation charge of US$809 million was recognised in the half year ended 31 December
2014.

Impairment of Nickel West assets:

On 12 November 2014, the Group announced that the review of its Nickel West business was complete
and the preferred option, the sale of the business, was not achieved on an acceptable basis. As a result of
operational decisions made subsequent to the conclusion of this process, an impairment charge of US$290
million (after tax benefit) was recognised in the half year ended 31 December 2014.

Half year ended 31 December 2013                                             Gross                    Tax             Net
                                                                              US$M                   US$M            US$M
Exceptional items by category
Sale of Pinto Valley                                                           551                   (205)            346
                                                                               551                   (205)            346

Year ended 30 June 2014                                                      Gross                    Tax             Net
                                                                              US$M                   US$M            US$M
Exceptional items by category
Sale of Pinto Valley                                                           551                   (166)            385
                                                                               551                   (166)            385

Sale of Pinto Valley

On 11 October 2013, the Group announced it had completed the sale of its Pinto Valley mining operation for cash
consideration of US$653 million, after working capital adjustments. A gain on sale of US$346 million (after tax
expense) was recognised in the half year ended 31 December 2013 (30 June 2014: US$385 million).

4. Interests in associates and joint venture entities

Major shareholdings in                    Ownership interest at BHP                       Share of operating profit of equity
associates and joint                    Billiton Group reporting date(a)                        accounted investments
venture entities
                                        31 Dec       31 Dec       30 June       Half year ended       Half year ended       Year ended
                                          2014         2013          2014           31 Dec 2014           31 Dec 2013     30 June 2014
                                             %            %             %                  US$M                   S$M             US$M
Carbones del Cerrej?n LLC                33.33        33.33         33.33                   (24)                   72              115
Compañia Minera Antamina SA              33.75        33.75         33.75                   156                   310              476
Samarco Mineração SA                        50           50            50                   216                   289              607
Other(b)                                                                                    (10)                   15               (3)
Total                                                                                       338                   686            1,195
(a) The ownership interest at the Group’s and the associates and joint venture entities’ reporting dates are the same. When the
    annual financial reporting date is different to the Group’s, financial information is obtained as at 30 June in order to report on a
    basis consistent with the Group’s reporting date.
(b) Includes the Group’s effective interest in the Newcastle Coal Infrastructure Group Pty Limited (ownership interest 35.5 per cent;
    31 December 2013: 35.5 per cent; 30 June 2014: 35.5 per cent) and other immaterial equity accounted investments.


5. Net finance costs
                                                                      Half year ended         Half year ended              Year ended
                                                                          31 Dec 2014             31 Dec 2013            30 June 2014
                                                                                 US$M                    US$M                    US$M
Financial expenses
Interest on bank loans and overdrafts                                               7                       7                      14
Interest on all other borrowings(a)                                               234                     376                     708
Finance lease and hire purchase interest                                           44                       5                      55
Discounting on provisions and other liabilities                                   256                     224                     475
Net interest expense on post-retirement employee benefits                          13                      11                      22
Interest capitalised(b)                                                           (83)                   (130)                   (182)
Fair value change on hedged loans                                                 869                    (447)                    328
Fair value change on hedging derivatives                                         (874)                    446                    (292)
Fair value change on non-hedging derivatives(c)                                     -                     101                     101
Exchange variations on net debt(d)                                               (174)                     (4)                     44
                                                                                  292                     589                   1,273
Financial income
Interest income                                                                   (60)                    (61)                    (97)
                                                                                  (60)                    (61)                    (97)
Net finance costs                                                                 232                     528                   1,176
(a) Interest on all other borrowings in the half year ended 31 December 2014 includes interest income of US$67 million (31
    December 2013: expense of US$87 million; 30 June 2014: expense of US$116 million) with respect to Petrohawk Senior
    Notes, which included gains of US$80 million on the early redemption notes in August 2014 (31 December 2013: US$ nil; 30
    June 2014: gains of US$24 million on the early redemption of notes in February 2014).
(b) Interest has been capitalised at the rate of interest applicable to the specific borrowings financing the assets under construction
    or, where financed through general borrowings, at a capitalisation rate representing the average interest rate on such
    borrowings. For the half year ended 31 December 2014, the capitalisation rate was 1.89 per cent (31 December 2013: 1.75 per
    cent; 30 June 2014: 1.82 per cent).
(c) Fair value change on non-hedging derivatives in the half year ended 31 December 2013 and year ended 30 June 2014
    includes unrealised fair value changes of US$101 million on non-hedging derivatives used to manage interest rate risk. No
    such derivatives existed in the current period.
(d) Exchange variations on net debt in the half year ended 31 December 2014 predominantly comprises revaluations of US$159
    million on non-USD finance leases (31 December 2013: US$ nil; 30 June 2014: US$60 million).


6. Taxation
                                                                      Half year ended         Half year ended              Year ended
                                                                          31 Dec 2014             31 Dec 2013            30 June 2014
                                                                                 US$M                    US$M                    US$M
Taxation expense attributed to geographical jurisdiction:
UK taxation expense/(benefit)                                                       3                     (11)                    (44)
Australian taxation expense                                                     2,639                   2,265                   4,871
Overseas taxation expense                                                       1,150                   1,264                   2,185
Total taxation expense(a)                                                       3,792                   3,518                   7,012


                                                                      Half year ended         Half year ended              Year ended
                                                                          31 Dec 2014             31 Dec 2013            30 June 2014
                                                                                 US$M                    US$M                    US$M
Total taxation expense comprises:
Income tax expense
Income tax expense                                                              2,848                   3,692                   6,538
                                                                                2,848                   3,692                   6,538
Total royalty-related taxation (net of income tax benefit)(b)
Minerals Resource Rent Tax expense/(benefit)                                      643                    (462)                   (238)
Other royalty-related taxation expense                                            301                     288                     712
                                                                                  944                    (174)                    474
Total taxation expense                                                          3,792                   3,518                   7,012
(a) Total taxation expense including royalty-related taxation, exceptional items and exchange rate movements, was
    US$3,792 million, representing an effective tax rate of 44.2 per cent (31 December 2013: 28.4 per cent; 30 June 2014: 31.5
    per cent). Exchange rate movements increased taxation expense by US$290 million, representing an increase in the effective
    tax rate of 3.4 per cent (31 December 2013: decrease of US$46 million and 0.4 per cent; 30 June 2014: decrease of US$24
    million and 0.1 per cent). Exceptional items, as described in note 3, increased taxation expense by US$690 million
    (31 December 2013: increase of US$205 million; 30 June 2014: increase of US$166 million).
(b) Government imposed royalty arrangements calculated by reference to profits, including MRRT, are reported as royalty-related
    taxation. Total royalty-related taxation increased taxation expense by US$944 million resulting in an increase in the effective
    tax rate of 11.0 per cent (31 December 2013: decrease of US$174 million and 1.4 per cent; 30 June 2014: increase of
    US$474 million and 2.1 per cent). The MRRT increased taxation expense by US$643 million in the period (31 December 2013:
    decrease of US$462 million; 30 June 2014: decrease of US$238 million). This included an exceptional item of US$809 million
    tax expense (31 December 2013: US$ nil; 30 June 2014: US$ nil) for the derecognition of deferred tax assets upon the repeal
    of the MRRT legislation in Australia. Refer to note 3.


7. Earnings per share
                                                                      Half year ended         Half year ended             Year ended
                                                                          31 Dec 2014             31 Dec 2013           30 June 2014
Basic earnings per ordinary share (US cents)                                     80.2                   152.4                  260.0
Diluted earnings per ordinary share (US cents)                                   80.0                   151.9                  259.1
Basic earnings per American Depositary Share (ADS) (US cents)(a)                160.4                   304.8                  520.0
Diluted earnings per American Depositary Share (ADS) (US cents)(a)              160.0                   303.8                  518.2
Basic earnings (US$M)                                                           4,265                   8,107                 13,832
Diluted earnings (US$M)                                                         4,265                   8,107                 13,832

(a) Each American Depositary Share represents two ordinary shares.

The weighted average number of shares used for the purposes of calculating diluted earnings per share
reconciles to the number used to calculate basic earnings per share as follows:

                                                                      Half year ended         Half year ended             Year ended
                                                                          31 Dec 2014             31 Dec 2013           30 June 2014
                                                                              Million                 Million                Million
Weighted average number of shares
Basic earnings per ordinary share denominator                                   5,317                   5,321                  5,321
Shares and options contingently issuable under employee
share ownership plans                                                              17                      16                     17
Diluted earnings per ordinary share denominator                                 5,334                   5,337                  5,338

8. Dividends
                                                                      Half year ended         Half year ended             Year ended
                                                                          31 Dec 2014             31 Dec 2013           30 June 2014
                                                                                 US$M                    US$M                   US$M
Dividends paid/payable during the period 
BHP Billiton Limited                                                            1,986                   1,898                  3,793
BHP Billiton Plc – Ordinary shares                                              1,306                   1,237                  2,483
                 – Preference shares(a)                                             –                       –                      –
                                                                                3,292                   3,135                  6,276

Dividends determined in respect of the
period
BHP Billiton Limited                                                            1,990                   1,895                  3,887
BHP Billiton Plc – Ordinary shares                                              1,308                   1,246                  2,555
                 – Preference shares(a)                                             –                       –                      –
                                                                                3,298                   3,141                  6,442
(a) 5.5 per cent dividend on 50,000 preference shares of £1 each determined and paid annually (31 December 2013:
5.5 per cent; 30 June 2014: 5.5 per cent).

                                                                      Half year ended         Half year ended             Year ended
                                                                          31 Dec 2014             31 Dec 2013           30 June 2014
                                                                             US cents                US cents               US cents
Dividends paid during the period (per share)
Prior year final dividend                                                        62.0                    59.0                   59.0
Interim dividend                                                                  N/A                     N/A                   59.0
                                                                                 62.0                    59.0                  118.0

Dividends determined in respect of the period (per share)
Interim dividend                                                                 62.0                    59.0                   59.0
Final dividend                                                                    N/A                     N/A                   62.0
                                                                                 62.0                    59.0                  121.0

Dividends are determined after period end in the announcement of the results for the period. Interim
dividends are determined in February and paid in March. Final dividends are determined in August and
paid in September. Dividends determined are not recorded as a liability at the end of the period to which
they relate. Subsequent to half year end, on 24 February 2015, BHP Billiton determined an interim dividend
of 62.0 US cents per share (US$3,298 million), which will be paid on 31 March 2015 (31 December 2013:
interim dividend of 59.0 US cents per share – US$3,141 million; 30 June 2014: final dividend of 62.0 US
cents per share – US$3,301 million).

BHP Billiton Limited dividends for all periods presented are, or will be, fully franked based on a tax rate of
30 per cent.

9. Financial risk management – Fair values

All financial assets and financial liabilities, other than derivatives, are initially recognised at the fair value of
consideration paid or received, net of transaction costs as appropriate, and subsequently carried at fair
value or amortised cost, as indicated in the tables below. Derivatives are initially recognised at fair value on
the date the contract is entered into and are subsequently remeasured at their fair value.

The financial assets and liabilities are presented by class in the tables below at their carrying values, which
generally approximate to the fair values. In the case of US$3,319 million of centrally managed fixed rate
debt (30 June 2014: US$3,319 million; 31 December 2013: US$3,320 million) and other fixed interest
borrowings of US$ nil not swapped to floating rate (30 June 2014: US$2,018 million; 31 December 2013:
US$3,471 million), the fair values at 31 December 2014 were US$3,771 million (30 June 2014: US$3,718
million; 31 December 2013: US$3,904 million) and US$ nil (30 June 2014: US$1,947 million; 31 December
2013: US$3,850 million) respectively.

Financial assets and liabilities

 31 December 2014                                                                                        Other
                                                                           Held at                   financial
                                                                        fair value                  assets and
                                                            Available      through       Cash   liabilities at
                                                Loans and    for sale    profit or       flow        amortised
                                              receivables  securities         loss     hedges             cost      Total
                                                     US$M        US$M         US$M       US$M             US$M       US$M
 Financial assets
 Cash and cash equivalents                          6,130           –            –          –                –      6,130
 Trade and other receivables(a)                     4,752           –          832          –                –      5,584
 Cross currency and interest rate swaps                 –           –        1,276        (12)               –      1,264
 Commodity contracts                                    –           –            7          –                –          7
 Other derivative contracts                             –           –          304          –                –        304
 Loans to equity accounted investments              1,032           –            –          –                –      1,032
 Interest bearing loans receivable                    169           –            –          –                –        169
 Shares                                                 –         519            –          –                –        519
 Other investments                                      –         137            –          –                –        137
 Total financial assets                            12,083         656        2,419        (12)               –     15,146
 Non-financial assets                                                                                             130,935
 Total assets                                                                                                     146,081
 Financial liabilities
 Trade and other payables(b)                            –           –          240          –            7,732      7,972
 Cross currency and interest rate swaps                 –           –         (170)       699                –        529
 Forward exchange contracts                             –           –            1          –                –          1
 Commodity contracts                                    –           –            4          –                –          4
 Other derivative contracts                             –           –           39          –                –         39
 Unsecured bank overdrafts and short-term
 borrowings                                             –           –            –          –               11         11
 Unsecured bank loans                                   –           –            –          –            1,368      1,368
 Commercial paper                                       –           –            –          –              240        240
 Notes and debentures(c)                                –           –            –          –           27,855     27,855
 Finance leases                                         –           –            –          –            1,192      1,192
 Unsecured other                                        –           –            –          –              403        403
 Total financial liabilities                            –           –          114        699           38,801     39,614
 Non-financial liabilities                                                                                         20,217
 Total liabilities                                                                                                 59,831

9. Financial Risk Management – Fair values (continued)

Financial assets and liabilities

                                                                                                         Other
 30 June 2014                                                               Held at                  financial
                                                                         fair value                 assets and
                                                             Available      through      Cash   liabilities at
                                                Loans and     for sale    profit or      flow        amortised
                                              receivables   securities         loss    hedges             cost      Total
                                                     US$M         US$M         US$M      US$M             US$M       US$M
 Financial assets
 Cash and cash equivalents                          8,803            –            –         –                –      8,803
 Trade and other receivables(a)                     5,431            –        1,071         –                –      6,502
 Cross currency and interest rate swaps                 –            –          846       637                –      1,483
 Commodity contracts                                    –            –           25         –                –         25
 Other derivative contracts                             –            –          271         –                –        271
 Loans to equity accounted investments              1,205            –            –         –                –      1,205
 Interest bearing loans receivable                    337            –            –         –                –        337
 Shares                                                 –          512            –         –                –        512
 Other investments                                      –          145            –         –                –        145
 Total financial assets                            15,776          657        2,213       637                –     19,283
 Non-financial assets                                                                                             132,130
 Total assets                                                                                                     151,413
 Financial liabilities
 Trade and other payables(b)                            –            –          300         –            9,560      9,860
 Cross currency and interest rate swaps                 –            –          221        52                –        273
 Commodity contracts                                    –            –            9         –                –          9
 Other derivative contracts                             –            –           37         –                –         37
 Unsecured bank overdrafts and short-term
 borrowings                                             –            –            –         –               51         51
 Unsecured bank loans                                   –            –            –         –            1,462      1,462
 Notes and debentures(c)                                –            –            –         –           31,247     31,247
 Finance leases                                         –            –            –         –            1,384      1,384
 Unsecured other                                        –            –            –         –              445        445
 Total financial liabilities                            –            –          567        52           44,149     44,768
 Non-financial liabilities                                                                                         21,263
 Total liabilities                                                                                                 66,031

9. Financial Risk Management – Fair values (continued)

Financial assets and liabilities

                                                                                                          Other
 31 December 2013                                                           Held at                   financial
                                                                         fair value                  assets and
                                                             Available      through      Cash    liabilities at
                                                Loans and     for sale    profit or      flow         amortised
                                              receivables   securities         loss    hedges              cost    Total
                                                     US$M         US$M         US$M      US$M              US$M     US$M
  Financial assets
  Cash and cash equivalents                        10,947            –            –         –                 –   10,947
  Trade and other receivables(a)                    5,205            –        1,188         –                 –    6,393
  Cross currency and interest rate swaps                –            –        1,381       184                 –    1,565
  Commodity contracts                                   –            –           32         –                 –       32
  Other derivative contracts                            –            –          183         –                 –      183
  Loans to equity accounted investments             1,273            –            –         –                 –    1,273
  Interest bearing loans recievable                   546            –            –         –                 –      546
  Shares                                                –          502            –         –                 –      502
  Other investments                                     –          138            –         –                 –      138
  Total financial assets                           17,971          640        2,784       184                 –   21,579
  Non-financial assets                                                                                           129,436
  Total assets                                                                                                   151,015
  Financial liabilities
  Trade and other payables(b)                           –            –           50         –             9,557    9,607
  Cross currency and interest rate swaps                –            –        1,110       (14)                –    1,096
  Forward exchange contracts                            –            –            1         –                 –        1
  Commodity contracts                                   –            –           37         –                 –       37
  Other derivative contracts                            –            –           30         –                 –       30
  Unsecured bank overdrafts and short-term
  borrowings                                            –            –            –         –                38       38
  Unsecured bank loans                                  –            –            –         –             1,366    1,366
  Commercial paper                                      –            –            –         –               375      375
  Notes and debentures(c)                               –            –            –         –            35,173   35,173
  Finance leases                                        –            –            –         –               627      627
  Unsecured other                                       –            –            –         –               456      456
  Total financial liabilities                           –            –        1,228       (14)           47,592   48,806
  Non-financial liabilities                                                                                       19,930
  Total liabilities                                                                                               68,736
(a) Excludes input taxes of US$515 million (30 June 2014: US$564 million; 31 December 2013: US$575 million) included in other
    receivables.
(b) Excludes input taxes of US$443 million (30 June 2014: US$398 million; 31 December 2013: US$465 million) included in other
    payables.
(c) Includes US$3,319 million of fixed rate debt not swapped to floating rate (30 June 2014: US$3,319 million; 31 December 2013:
    US$3,320 million), US$ nil of fixed rate debt assumed as part of the acquisition of Petrohawk Energy Corporation (30 June
    2014: US$1,998 million; 31 December 2013: US$3,450 million) and US$24,536 million of other debt swapped to floating rate
    under fair value hedges (30 June 2014: US$25,930 million; 31 December 2013: US$28,403 million) that is fair valued for
    interest rate risk.
9. Financial Risk Management – Fair values (continued)

Fair value hierarchy

The carrying amount of financial assets and liabilities measured at fair value is where possible, calculated
with reference to quoted prices in active markets for identical assets or liabilities. Where no price
information is available from a quoted market source, alternative market mechanisms or recent comparable
transactions, fair value is estimated based on the Group’s views on relevant future prices, net of valuation
allowances to accommodate liquidity, modelling and other risks implicit in such estimates. The inputs used
in fair value calculations are determined by the relevant Group Function. Our Group Functions support the
Businesses and operate under a defined set of accountabilities authorised by the Group Management
Committee (GMC). Movements in the fair value of financial assets and liabilities may be recognised through
the income statement or in other comprehensive income. The following table shows the Group’s financial
assets and liabilities carried at fair value with reference to the nature of valuation inputs used.

31 December 2014                                                           Level 1(a)       Level 2(b)         Level 3(c)           Total
                                                                                US$M             US$M               US$M             US$M
Financial assets and liabilities
Trade and other receivables                                                        –              832                  –              832
Trade and other payables                                                           –             (240)                 –             (240)
Cross currency and interest rate swaps                                             –              735                  –              735
Forward exchange contracts                                                         –               (1)                 –               (1)
Commodity contracts                                                                –                3                  –                3
Other derivative contracts                                                         –                3                262              265
Investments – available for sale                                                   1              137                518              656
Total                                                                              1            1,469                780            2,250


31 June 2014                                                               Level 1(a)       Level 2(b)         Level 3(c)           Total
                                                                                US$M             US$M               US$M             US$M
Financial assets and liabilities
Trade and other receivables                                                        –            1,071                  –            1,071
Trade and other payables                                                           –             (300)                 –             (300)
Cross currency and interest rate swaps                                             –            1,210                  –            1,210
Commodity contracts                                                                –               16                  –               16
Other derivative contracts                                                         –              (13)               247              234
Investments – available for sale                                                   5              145                507              657
Total                                                                              5            2,129                754            2,888


31 December 2013                                                           Level 1(a)       Level 2(b)         Level 3(c)           Total
                                                                                US$M             US$M               US$M             US$M
Financial assets and liabilities
Trade and other receivables                                                        –            1,188                  –            1,188
Trade and other payables                                                           –              (50)                 –              (50)
Cross currency and interest rate swaps                                             –              469                  –              469
Forward exchange contracts                                                         –               (1)                 –               (1)
Commodity contracts                                                                –               (5)                 –               (5)
Other derivative contracts                                                         –               (5)               158              153
Investments – available for sale                                                   7              139                494              640
Total                                                                              7            1,735                652            2,394
(a) Valuation is based on unadjusted quoted prices in active markets for identical financial assets and liabilities.
(b) Valuation is based on inputs (other than quoted prices included in level 1) that are observable for the financial asset or liability,
    either directly (i.e. as unquoted prices) or indirectly (i.e. derived from prices).
(c) Valuation is based on inputs that are not based on observable market data.


9. Financial Risk Management – Fair values (continued)

Level 3 financial assets and liabilities

The following table shows the movements in the Group’s level 3 financial assets and liabilities.

                                                                               Half year ended     Year ended       Half year ended
                                                                                   31 Dec 2014   30 June 2014           31 Dec 2013
                                                                                          US$M           US$M                  US$M
At the beginning of the financial period                                                   754            690                   690
Additions                                                                                   19             66                    32
Disposals                                                                                    –            (47)                  (37)
Realised gains recognised in the income statement(a)                                         7              6                     6
Unrealised gains/(losses) recognised in the income statement(a)                              8             77                   (11)
Unrealised losses recognised in other comprehensive income(b)                               (8)           (19)                   (9)
Transfers(c)                                                                                 –            (19)                  (19)
Total at the end of the financial period                                                   780            754                   652
(a) Realised and unrealised gains and losses recognised in the income statement are recorded in expenses.
(b) Unrealised gains and losses recognised in other comprehensive income are recorded in the financial assets reserve.
(c) Includes US$ nil (30 June 2014: US$19 million; 31 December 2013: US$19 million) related to an available for sale investment
    now classified as an equity accounted investment due to the adoption of IFRS 11.


Sensitivity of level 3 financial assets and liabilities

The carrying amount of financial assets and liabilities that are valued using inputs other than observable
market data are calculated using appropriate valuation models, including discounted cash flow modelling,
with inputs such as commodity prices, foreign exchange rates and inflation. The potential effect of using
reasonably possible alternative assumptions in these models, based on a change in the most significant
input by 10 per cent while holding all other variables constant, is shown in the following table. Significant
inputs are assessed individually for each financial asset and liability.

31 December 2014                                                                 Profit after taxation            Equity
                                                                                 10 per         10 per       10 per       10 per
                                                                                   cent           cent         cent         cent
                                                                  Carrying     increase       decrease     increase     decrease
                                                                     value     in input       in input     in input     in input
                                                                      US$M         US$M           US$M         US$M         US$M
Financial assets and liabilities
Other derivative contracts                                             262           59           (59)           59          (59)
Investments – available for sale                                       518            –             –            63          (60)
Total                                                                  780           59           (59)          122         (119)

31 June 2014                                                                     Profit after taxation            Equity
                                                                                 10 per         10 per       10 per       10 per
                                                                                   cent           cent         cent         cent
                                                                  Carrying     increase       decrease     increase     decrease
                                                                     value     in input       in input     in input     in input
                                                                      US$M         US$M           US$M         US$M         US$M
Financial assets and liabilities
Other derivative contracts                                            247            67            (67)          67          (67)
Investments – available for sale                                      507             –              –           72          (39)
Total                                                                 754            67            (67)         139         (106)

9. Financial Risk Management – Fair values (continued)

31 December 2013                                                                 Profit after taxation            Equity
                                                                                 10 per          10 per       10 per       10 per
                                                                                   cent            cent         cent         cent
                                                                  Carrying     increase        decrease     increase     decrease
                                                                     value     in input        in input     in input     in input
                                                                      US$M         US$M            US$M         US$M         US$M
Financial assets and liabilities
Other derivative contracts                                             158           48             (48)          48          (48)
Investments – available for sale                                       494            –               –           67          (61)
Total                                                                  652           48             (48)         115         (109)

10. Significant events

The Group announced on 19 August 2014 that it plans to demerge a selection of its aluminium, coal,
manganese, nickel and silver assets to create an independent metals and mining company. On 8
December 2014, the Group announced that the new company it intends to create through its proposed
demerger will be called South32. A final Board decision on the proposed demerger will be made once all
necessary third party approvals are secured on satisfactory terms. On this basis, the Group expects to
release all shareholder documentation with full details of the proposed demerger in mid-March 2015 with a
shareholder vote taking place in early May 2015. As numerous steps are required to enable the demerger
to proceed, the relevant businesses have not been classified as held for sale or distribution as at 31
December 2014.

Summarised financial information as at 31 December 2014 and for the half year ended 31 December 2014
of the businesses included in the proposed demerger is provided below:

                                                                                                                 Half year ended
                                                                                                                31 December 2014
                                                                                                                            US$M


Current assets                                                                                                             3,122
Non-current assets                                                                                                        14,093
Current liabilities                                                                                                        1,895
Non-current liabilities                                                                                                    3,512
Net assets                                                                                                                11,808
 Attributable to non-controlling interests                                                                                   837
 Attributable to members of BHP Billiton Group                                                                            10,971


Revenue                                                                                                                    5,040
Depreciation and amortisation                                                                                                506
Profit before interest and taxation                                                                                          887


Net operating cash inflows                                                                                                   885
Net investing cash outflows                                                                                                  415


Transaction costs incurred(a)                                                                                                115
(a) Transaction costs of US$45 million were incurred in relation to the proposed demerger for the financial year ended 30 June
    2014.

The demerger will be recognised as a reduction in equity at the fair value of the shares in the demerged
company distributed to shareholders. A gain or loss will arise on the difference between the fair value of
those shares and the net assets of the demerged businesses determined at the date of the demerger,
which will include the fair value step-up on the Manganese business, described below less any transaction
costs. Transaction costs will mainly comprise stamp duty, professional fees and separation and
establishment costs.

10. Significant events (continued)

In contemplation of the proposed demerger, BHP Billiton and Anglo American agreed to make certain
changes to the agreement which governs their interests in the Manganese business. BHP Billiton manages
and owns 60 per cent of the Manganese business with Anglo American owning the remaining 40 per cent.
Subject to obtaining the required approvals for the agreement, the changes will result in BHP Billiton and
Anglo American agreeing to share joint control of the Manganese business. BHP Billiton will discontinue
consolidation of the Manganese business and account for its 60 per cent interest as an equity accounted
joint venture. BHP Billiton will therefore derecognise the existing carrying amounts of all assets, liabilities
and the non-controlling interest in the Manganese business attributed to Anglo American and initially record
its retained 60 per cent interest at fair value. The remeasurement at fair value will give rise to an estimated
gain of approximately US$2 billion. There are no tax consequences arising from the remeasurement of the
Manganese business.

11. Subsequent events

Other than the matters outlined elsewhere in this financial report, no matters or circumstances have arisen
since the end of the half year that have significantly affected, or may significantly affect, the operations,
results of operations or state of affairs of the Group in subsequent accounting periods.

Directors’ Report

The Directors present their report together with the half year financial statements for the half year ended
31 December 2014 and the auditor’s review report thereon.

Review of Operations

A detailed review of the Group’s operations, the results of those operations during the half year ended
31 December 2014 and likely future developments are given on pages 1 to 28. The Review of Operations
has been incorporated into, and forms part of, this Directors’ Report.

Principal Risks and Uncertainties

Because of the international scope of the Group's operations and the industries in which it is engaged,
there are a number of risk factors and uncertainties which could have an effect on the Group's results and
operations. Material risks that could impact on the Group's performance include those referred to in the
‘Outlook’ section as well as:

-   Fluctuations in commodity prices and impacts of            - The commercial counterparties we transact with
    ongoing global economic volatility may negatively            may not meet their obligations, which may
    affect our results, including cash flows and asset           negatively impact our results
    values
-   Our financial results may be negatively affected by        - Cost pressures and reduced productivity could
    currency exchange rate fluctuations                          negatively impact our operating margins and
                                                                 expansion plans
-   Reduction in Chinese demand may negatively                 - Unexpected natural and operational catastrophes
    impact our results                                           may adversely impact our operations
-   Actions by governments or political events in the          - Our non-operated assets may not comply with our
    countries in which we operate could have a                   standards
    negative impact on our business
-   Failure to discover or acquire new resources,              - Breaches in our information technology security
    maintain reserves or develop new operations could            processes may adversely impact our business
    negatively affect our future results and financial           activities
    condition
-   Potential changes to our portfolio of assets through       - Safety, health, environmental and community
    acquisition and divestments or demerger may have             impacts, incidents or accidents and related
    a material adverse effect on our future results and          regulations may adversely affect our people,
    financial condition                                          operations and reputation or licence to operate
-   Increased costs and schedule delays may                    - Climate change may impact the value of our
    adversely affect our development projects                    Company, and our operations and markets
-   If our liquidity and cash flow deteriorate significantly   - A breach of our governance processes may lead to
    it could adversely affect our ability to fund our major      regulatory penalties and loss of reputation
    capital programs
-   We may not recover our investments in mining, oil
    and gas assets, which may require financial write-
    downs
Further information on the above risks and uncertainties can be found on pages 20 to 24 of the Group's
Annual Report for the year ended 30 June 2014, a copy of which is available on the Group's website at
www.bhpbilliton.com.

Dividend

Full details of dividends are given on page 11.

Board of Directors

The Directors of BHP Billiton at any time during or since the end of the half year are:

Mr J Nasser – Chairman since March 2010 (a Director         Mr A Mackenzie – an Executive Director since May
since June 2006)                                            2013
Mr M Brinded – a Director since April 2014                  Mr L P Maxsted – a Director since March 2011
Mr M W Broomhead – a Director since March 2010              Mr W W Murdy – a Director since June 2009

Sir J G Buchanan – a Director since February 2003           Mr K C Rumble – a Director since September 2008

Mr C A Cordeiro – a Director since February 2005            Dr J M Schubert – a Director since June 2000

Mr L P Davies – a Director since June 2012                  Baroness S Vadera – a Director since January 2011

Ms C J Hewson – a Director since March 2010                 Mr D A Crawford – a Director from May 1994 to
                                                            November 2014

Auditor’s independence declaration

KPMG in Australia are the auditors of BHP Billiton Limited. Their auditor’s independence declaration under
Section 307C of the Australian Corporations Act 2001 is set out on page 55 and forms part of this Directors’
Report.

Rounding of amounts

BHP Billiton Limited is a company of a kind referred to in Australian Securities and Investments
Commission Class Order No 98/100, dated 10 July 1998. Amounts in the Directors’ Report and half year
financial statements have been rounded to the nearest million dollars in accordance with that Class Order.

Signed in accordance with a resolution of the Board of Directors.

J Nasser AO – Chairman

A Mackenzie – Chief Executive Officer

Dated this 24th day of February 2015

Directors’ Declaration of Responsibility

The half year financial report is the responsibility of, and has been approved by, the Directors. In
accordance with a resolution of the Directors of BHP Billiton, the Directors declare that, to the best of their
knowledge and in their reasonable opinion:

(a) the half year financial statements and notes, set out on pages 31 to 51, have been prepared in
    accordance with IAS 34 ‘Interim Financial Reporting’ as issued by the IASB, IAS 34 ‘Interim Financial
    Reporting’ as adopted by the EU, AASB 134 ‘Interim Financial Reporting’ as issued by the AASB and
    the Disclosure and Transparency Rules of the Financial Conduct Authority in the United Kingdom and
    the Australian Corporations Act 2001, including:
      (i) complying with applicable accounting standards and the Australian Corporations Regulations
          2001; and
     (ii) giving a true and fair view of the financial position of the BHP Billiton Group as at
          31 December 2014 and of its performance for the half year ended on that date;
(b) the Directors’ Report, which incorporates the Review of Operations on pages 1 to 28, includes a fair
    review of the information required by:
      (i) DTR4.2.7R of the Disclosure and Transparency Rules in the United Kingdom, being an indication
          of important events during the first six months of the current financial year and their impact on the
          half year financial statements, and a description of the principal risks and uncertainties for the
          remaining six months of the year; and
     (ii) DTR4.2.8R of the Disclosure and Transparency Rules in the United Kingdom, being related party
          transactions that have taken place in the first six months of the current financial year and that
          have materially affected the financial position or performance of the BHP Billiton Group during
          that period, and any changes in the related party transactions described in the last annual report
          that could have such a material effect; and
(c) in the Directors’ opinion, there are reasonable grounds to believe that each of BHP Billiton Limited and
    BHP Billiton Plc will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of the Board of Directors.

J Nasser AO – Chairman

A Mackenzie – Chief Executive Officer

Dated this 24th day of February 2015

Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

To: the Directors of BHP Billiton Limited:

I declare that, to the best of my knowledge and belief, in relation to the review for the half year ended 31
December 2014 there have been:
   i.    no contraventions of the auditor independence requirements as set out in the Australian
         Corporations Act 2001 in relation to the review; and
  ii.    no contraventions of any applicable code of professional conduct in relation to the review.
This declaration is in respect of BHP Billiton and the entities it controlled during the financial period.

KPMG

Anthony Young
Partner
Melbourne
24 February 2015

KPMG, an Australian partnership and member firm of the KPMG network of independent member firms
affiliated with KPMG International Cooperative (‘KPMG International’) a Swiss entity.

KPMG Australia’s liability limited by a scheme approved under Professional Standards Legislation.

Independent Review Report

Independent Review Report of KPMG LLP (“KPMG UK”) to BHP Billiton Plc and KPMG (“KPMG
Australia”) to the Members of BHP Billiton Limited

Introduction

For the purposes of these reports, the terms “we” and “our” denote KPMG UK in relation to its
responsibilities under its terms of engagement to report to BHP Billiton Plc and KPMG Australia in relation
to Australian professional and regulatory responsibilities and reporting obligations to the members of BHP
Billiton Limited.

The BHP Billiton Group (“the Group”) consists of BHP Billiton Plc and BHP Billiton Limited and the entities
they controlled at the end of the half year or from time to time during the half year ended 31 December
2014.

We have reviewed the condensed half year financial statements of the Group for the half year ended 31
December 2014 (“half year financial statements”), set out on pages 31 to 51, which comprise the
consolidated income statement, consolidated statement of comprehensive income, consolidated balance
sheet, consolidated cash flow statement, consolidated statement of changes in equity, summary of
significant accounting policies and other explanatory notes 1 to 11. We have read the other information
contained in the half year financial report and considered whether it contains any apparent misstatements
or material inconsistencies with the information in the half year financial statements. KPMG Australia has
also reviewed the directors’ declaration set out on page 54 in relation to Australian regulatory requirements
contained in section (a) and (c) of the directors’ declaration.

Directors’ Responsibilities

The half year financial report is the responsibility of, and has been approved by, the Directors. The
Directors are responsible for preparing the half year financial report:
- in accordance with the Disclosure and Transparency Rules (“the DTR”) of the United Kingdom’s
  Financial Conduct Authority (“the UK FCA”), and under those rules, in accordance with IAS 34 Interim
  Financial Reporting as adopted by the European Union; and
- in accordance with Australian Accounting Standards and the Corporations Act 2001. This responsibility
  includes establishing and maintaining internal control relevant to the preparation and fair presentation of
  the half year financial statements that are free from material misstatement, whether due to fraud or error;
  selecting and applying appropriate accounting policies; and making accounting estimates that are
  reasonable in the circumstances.

Respective Responsibilities of KPMG UK and KPMG Australia

KPMG UK’s report is made solely to BHP Billiton Plc in accordance with the terms of KPMG UK’s
engagement to assist BHP Billiton Plc in meeting the requirements of the DTR of the UK FCA. KPMG UK’s
review has been undertaken so that it might state to BHP Billiton Plc those matters it is required to state to
it in this report and for no other purpose. To the fullest extent permitted by law, KPMG UK does not accept
or assume responsibility to anyone other than BHP Billiton Plc, for KPMG UK’s review work, for this report,
or for the conclusions it has reached.

KPMG Australia has performed an independent review of the half year financial statements and directors’
declaration in order to state whether, on the basis of the procedures described, it has become aware of any
matter that makes KPMG Australia believe that the half year financial statements and directors’ declaration
are not in accordance with the Corporations Act 2001 including: giving a true and fair view of the Group’s
financial position as at 31 December 2014 and its performance for the half year ended on that date; and
complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Australian
Corporations Regulations 2001.

Our responsibility is to express a conclusion on the half year financial statements in the half year financial
report based on our review.

Scope of Review

KPMG UK conducted its review in accordance with International Standard on Review Engagements (UK
and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the
Entity issued by the Auditing Practices Board for use in the United Kingdom.

KPMG Australia conducted its review in accordance with Auditing Standard on Review Engagements
ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity as issued by
the Australian Auditing and Assurance Standards Board. As auditor of BHP Billiton Limited, KPMG
Australia is required by ASRE 2410 to comply with the ethical requirements relevant to the audit of the
annual financial report.

A review of half year financial statements consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with auditing standards and
consequently does not enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Independence

In conducting its review, KPMG Australia has complied with the independence requirements of the
Australian Corporations Act 2001.

Review conclusion by KPMG UK

Based on our review, nothing has come to our attention that causes us to believe that the condensed half-
year financial statements in the half-year financial report for the six months ended 31 December 2014 are
not prepared, in all material respects, in accordance with IAS 34 Interim Financial Reporting, as adopted by
the EU, and the DTR of the UK FCA.

Stephen Oxley
Partner
For and on behalf of KPMG LLP
Chartered Accountants
London
25 February 2015

Review conclusion by KPMG Australia

Based on our review, which is not an audit, we have not become aware of any matter that makes us
believe that the condensed half year financial statements and directors’ declaration of the Group are not in
accordance with the Australian Corporations Act 2001, including:
   a) giving a true and fair view of the Group’s financial position as at 31 December 2014 and of its
      performance for the half year ended on that date; and
   b) complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the
      Australian Corporations Regulations 2001.
KPMG

Anthony Young
Partner
Melbourne
24 February 2015

KPMG, an Australian partnership and KPMG LLP, a UK limited liability partnership, are member firms of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG
International’) a Swiss entity.

KPMG Australia’s liability limited by a scheme approved under Professional Standards Legislation.

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