Rio Tinto Limited (ASX: RIO), Australia’s second-largest mining company, released its 2018 half financial year (HY18) report to investors this afternoon. Here are three key takeaways from Rio’s report:
- A half-yearly dividend of US$1.27 will be paid, together with another $1 billion share buyback
- Revenue came in at $US19.9 billion, up $0.6 billion from the same time last year
- Net profit rose 33% to $US4.4 billion
Commenting on the first half performance, Rio Tinto CEO J-S Jacques said, “We have reported another strong set of results with underlying EBITDA of $9.2 billion and operating cash flow of $5.2 billion.”
(click here to learn what EBITDA means)
“In a favourable market environment, our Tier 1 assets and strong operational capability have achieved a 43 per cent EBITDA margin,” Jacques added.
“As a result, we continue to deliver superior shareholder returns with a record interim dividend of $2.2 billion and a $1.0 billion top-up to our existing share buy-back programme.”
So far in 2018 Rio Tinto has sold $US5 billion of assets, which it says it will return to shareholders, net of taxes, sometime in the near future.
Over the long-run, Jacques says Rio Tinto will continue to invest in its core projects, which span iron ore, copper and aluminium.
“We will continue to invest in Tier 1 growth, further strengthen our portfolio and maintain a strong balance sheet in order to deliver superior returns to shareholders in the short, medium and long term.”
Rio Tinto will invest $US6 billion in 2019 and $US6.9 billion in 2020, of which between $US2.0 billion and $US2.5 billion will be to sustain the business. Meaning, the other ~$US4 billion will be invested in growth opportunities.
ASX-listed Rio Tinto shares traded 0.55% higher in the lead up to the results release on Wednesday.
Investors will now turn to BHP Billiton Limited (ASX: BHP) and Fortescue Metals Group Limited’s (ASX: FMG) results which are due out later this month.
