LONDON: Rio Tinto Group will pay its highest interim dividend in four years as first-half profit soared on strong commodity prices and a restructuring drive that boosted earnings.
The world’s second-biggest miner posted a 43% increase in underlying profit to US$6.85bil, lifting its interim dividend to US$2.11 per share, the highest since 2022.
The company’s Sydney-listed shares rose more than 5% in early trading.
The higher earnings were driven by a US$3.6bil benefit from stronger commodity prices, the company said in filings.
Prices for copper, a key growth business for the company, have climbed about 10% this year, driven by supply disruptions and demand boost from data centres.
Over the reporting period Rio found US$870mil in cost savings through productivity efforts. It plans to find further savings, bringing the total to US$1.8bil by year-end.
“There is substantially more to come,” chief executive officer Simon Trott said of the savings, adding the company was in a “relentless pursuit” of operational efficiencies.
“You’re really seeing productivity become a structural driver of improvement in these numbers,” he added.
Trott has prioritised slimming down Rio and making it a more simplified business since he was appointed in August last year.
Part of the strategy involves selling non-core assets to raise US$5bil in 2026, including the company’s titanium and borates divisions.
While little detail was provided on the timeline for the disposals, management was “comfortable” with how they were progressing, Trott said.
The results also came as strong commodity prices outweighed the impact of China’s economic slowdown, US tariff campaigns and conflict in the Middle East.
Prices of iron ore, Rio’s biggest earner, remained steady over the six-month period, despite plateauing demand from dominant buyer China.
The company is yet to complete negotiations with state-backed buyer China Mineral Resources Group Co over forward supply agreements. — Bloomberg
