Rio Tinto to give record interim dividend after net earnings soar

Rio Tinto to give record interim dividend after net earnings soar

Rio Tinto will return US$3 billion to its shareholders in the mining giant’s biggest interim dividend in its history, after higher commodity prices helped deliver net earnings of $3.9 billion during H1 2017.

The Anglo-Australian company said it would pay out 50% of its earnings during the first half of the year as a dividend of $1.10 cents a share, and would also spend a further $1 billion repurchasing its own shares.

Rio is halfway through a $500 million buyback programme which was launched in February.

“By driving performance, focusing on cash and allocating it with discipline we are delivering superior cash returns to our shareholders,” said chief executive J-S Jacques.

However, despite net earnings after tax rising by 152% in the six months to June, the figure failed to hit market forecasts of $4.1 billion.

Nonetheless, Jacques maintained the firm’s results were strong, with operating cash flow at $6.3 billion and net debt down by $2 billion to $7.6 billion.

The world’s second largest mining firm by value has been boosted by a higher iron ore price, which is currently trading at $70 a tonne.

Rio said it iron ore business had delivered 80% of the group’s underlying earnings during H1 2017.

@RGNonline