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Rio Tinto’s record performance

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London, England — MININGREVIEW.COM — 27 August 2008 – The Rio Tinto Group – the London and New York-listed international mining group headquartered in the United Kingdom, and the world’s third-largest mining company – has achieved a record-shattering first half of 2008, with top results underlining the company’s strong earnings and performance momentum.   
Releasing its results for the six months to 30 June 2008, the company announced an increase in first-half earnings before interest, tax, depreciation and amortisation to a record US$11.4 billion (R85.5 billion) – 73% above the figure for the first half of 2007. Underlying earnings rose 55% above those of January to June 2007 to a record US$5.5 billion (R41.25 billion), and net earnings in the first half of 2008 more than doubled to US$6.9 billion (R51.75 billion), increasing 113% above the figure for the same period of 2007.

The results statement also revealed that half-year production records had been achieved for iron ore, bauxite, alumina, aluminium, borates, titanium dioxide and thermal coal. Capital expenditure on investments in value-adding growth projects had risen 91% in the first half of 2008 to US$3.7 billion (R27.75 million). New capital commitments of over US$6 billion (R45 billion) had been announced, including substantial expansions of iron ore operations in Australia, Brazil and Canada.

The statement added that cash flow from operations was up 54% to a record of US$8.9 million (R66.75 billion) –  a run rate of approximately US$1.5 billion (R11.25 billion) of cash flow per month.  Rio Tinto Alcan integration was making good progress, and remained on track to deliver US$1.1 billion (R8.25 billion) after tax synergies from the end of 2009.  

The company’s interim dividend increased 31% to 68 US cents, with a continued commitment to increase the total 2008 and 2009 dividends by at least 20% each year, said the statement. The Rio Tinto divestment programme had made good progress with US$3 billion (R22.5 billion) of sales announced to date. The Group remained on track to announce UD$10 billion (R75 billion) of divestments in 2008.