Rio Tinto Posts FY Loss; Cuts Capex

(RTTNews) - Rio Tinto Plc (RTPPF.PK, RIO.L, RIO, RTNTF.PK) reported a loss for the fiscal year 2015, compared to net income in the previous year. The recent results reflected non-cash exchange rate and derivative losses of $3.3 billion and impairment charges of $1.8 billion.

The impairments mainly related to the Simandouiron ore project, Energy Resources of Australia (ERA) and the Roughrider uranium project. In addition, the Group recognised legacy remediation costs of $0.2 billion and general restructuring and headcount reduction costs of $0.3 billion.

It is expected that Capital expenditure to be around $4.0 billion in 2016, compared to previously expected Capital expenditure of $5.0 billion. It expects Capital expenditure of around $5.0 billion in 2017 compared to prior estimation of $7.0 billion. It is expected that Capital expenditure to be around $5.5 billion in 2018. Each year includes around $2.0 billion of sustaining capex.

Net loss attributable to the owners of the company for the year 2015 totalled $866 million or 47.5 cents compared to profit of $6.527 billion or 351.2 cents in the prior year.

Underlying earnings per share of 248.8 US cents compared with 503.4 US cents in 2014.

Underlying earnings of $4.5 billion, $4.8 billion lower than 2014, with cash cost improvements, higher volumes, lower energy costs, positive currency and other movements(totalling $2.9 billion) partly offsetting the $7.7 billion (post-tax) impact of lower prices.

Consolidated sales revenues of $34.8 billion, $12.8 billion lower than last year, reflecting a $13.1 billion reduction from the sharp decline in commodity prices.

The board has announced a final dividend of 107.5 US cents per share, bringing the 2015 full year dividend to 215 US cents per share, in line with 2014.

In light of the significant deterioration in the macro-economic environment and the resultant market uncertainty, the board believes that it is no longer appropriate to maintain the progressive dividend policy.

For 2016, the company intends that the full year dividend will not be less than 110 US cents per share, equivalent to $2 billion.

For 2016, Rio Tinto's expected global shipments are around 350 million tonnes (100 per cent basis) from its operations in Australia and Canada, subject to weather conditions. Rio Tinto's expected share of production of bauxite , alumina and aluminium is 45 million tonnes, 7.8 million tonnes and 3.6 million tonnes, respectively.