Rio Tinto First Half Earnings Fall 18%
Rio Tinto recently announced 2013 interim financial results. Underlying earnings were $4.2 billion, a decrease of 18%, reportedly reflecting lower average market prices and a higher effective tax rate, partly offset by record iron ore shipments and cost savings momentum. Net earnings of $1.7 billion include non-cash exchange losses of $1.9 billion and a $0.3 billion write-off of waste stripping costs and damaged equipment at Kennecott Utah Copper following the pit wall slide at Bingham Canyon in April.
“We are seeing good early results of our business performance initiatives in our pursuit of greater value for shareholders,” said Sam Walsh, chief executive. “We have achieved $1.5 billion in total cost reduction efforts in the first half, with $977 million from operating cost savings and $483 million from lower exploration and evaluation spend. This has driven strong operating cash flows, on a par with the first half of 2012, despite the weaker prices for most of our products. Capital expenditure has been reduced, approved growth projects are on track and operations are performing well. We have set ourselves firmly on the path toward becoming a leaner, more tightly-run business.”
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