Rio Tinto’s profit and dividend miss estimates
Rio Tinto’s half-year profit has slumped 34 per cent following weaker commodity prices, and the $US5.7 billion ($8.4 billion) underlying profit and $US1.77 per share interim dividend have fallen short of analyst expectations.
Net earnings were lower at $US5.1 billion after Rio took $US800 million of impairments against its Australian alumina refineries, partly because of the challenges imposed by the country’s new carbon policy.
The dividend payout was lower than in the past two years, but still the third-biggest interim dividend in Rio’s 150-year history.
The softer result continues Rio’s return to earth from the heady days of 2021, when record iron ore prices delivered an Australian corporate record half-year profit of $US12.16 billion.
Australian iron ore dominated the results again. Rio’s flagship division shipped 6 per cent more volume than in the same period last year and achieved its most productive start to a year since 2018. But the iron ore prices received by Rio over the past six months were 11 per cent lower than in the same period last year, offsetting the improved volumes.
Copper prices were also 12 per cent lower than in the first half of last year, and aluminium prices were down 25 per cent.
The analyst consensus measured by VUMA on Monday had pointed to Rio reporting a $US5.85 billion underlying half-year profit. The same survey expected it to declare an interim dividend of $US1.85 a share.
Dividends have declined more than profits over the past two years, and the latest payout is well below the $US5.61 per share handed out to Rio shareholders in July 2021.
Rio’s policy is to return about 50 per cent of underlying earnings at the half-year results; the 2021 interim dividend represented a 75 per cent
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