Higher prices drive Rio`s profits

Higher prices drive Rio`s profits
Mining News Pro - Major Rio Tinto has reported increased revenues and profits for the full 2020, driven by strong commodity prices.

Rio on Wednesday reported consolidated sales revenues of $44.6-billion for the full year, up 3% on the $43.1-billion reported in 2019, while underlying earnings before interest, taxes, depreciation and amortization (Ebitda) increased by 13%, to $23.9-billion.

Net earnings for the full year were up 22% to $9.7-billion, up from the $8-billion reported last year.

Net cash generated from operating activities was up 6%, to $15.9-billion, primarily driven by higher iron-ore prices and stability in operating performance. Rio noted that this flowed through to a 3% increase in free cash flow for the year, which reached $9.4-billion.

“It has been an extraordinary year, our successful response to the Covid-19 pandemic and strong safety performance were overshadowed by the tragic events at the Juukan Gorge, which should never have happened,” said Rio CEO Jakob Stausholm.

“During 2020, the agility and resilience of the business and our employees, coupled with strong commodity prices, enabled us to deliver underlying Ebitda of $23.9-billion and return on capital employed of 27%. As a result, the board has approved a total dividend of 557 US cents per share including a special dividend of 93 US cents per share, representing a 72% full year pay-out ratio, which builds on our five-year pay-out track record,” said Stausholm.

"My new executive team and wider leadership of the company are all committed to unleashing Rio’s full potential. We will increase our focus on operational excellence and project development and strengthen our environmental, social and governance credentials. Working closely with the board, we must earn the right to become a trusted partner for Traditional Owners, host communities, governments and other stakeholders but we all recognise that this will require sustained and consistent effort.

“Safe and well-run operations, together with world-class assets, great people, capital discipline and a strong balance sheet, leave Rio well placed to generate superior returns for shareholders, invest in sustaining and growing our portfolio, and make a broader contribution to society.”

During the year under review, the miner invested $625-million in exploration and evaluation spend, as it progressed its greenfield programmes and advanced its evaluation projects, which inlcude the Resolution copper project, in Arizona, the Jadar lithium/borates project in Serbia, and the Winu copper/gold project in Western Australia.

The company is also progressing its $2.6-billion Gudai-Darri replacement iron-ore mine, in Western Australia, with production ramp-up on track for early 2022. This first phase of Gudai- Darri will have a 43-million-tonne-a-year annual capacity, underpinning production of the Pilbara Blend.

Looking ahead, Rio is expecting capital expenditure in 2021 and 2022 to reach around $7.5-billion each, up from the previously planned $7-billion, as the Australian dollar is expected to strengthen.

   Short Link:  
Related News
chadormalu Co.
khuzestan steel
sangan steel