Rio Tinto commits further $2.5 billion to shareholders in buyback programme

Rio Tinto has announced it will distribute a further US$2.5 billion back to its shareholders having seen its coffers swell following the sale of its Coal & Allied business.

The share buyback programme arrives as a further boost to the Anglo-Australian mining giant’s shareholders, who will also receive a record interim dividend of $1.10 per share after the company made a HY underlying profit of $3.94 billion.

Rio’s latest commitment to rewarding its shareholders comes only three weeks after the $2.45 billion sale of Coal & Allied was finalised, and brings the company’s total share buybacks to $4 billion in 2017.

“Returning the $2.5 billion proceeds from our Coal & Allied divestment shows our continued commitment to delivering superior value and returning cash to our shareholders,” said Rio’s chief executive J-S Jacques.

Rio’s latest share buyback programme is emblematic of a wider recovery in the commodities industry, with mining majors able to focus on returning cash to shareholders having seen greater profits return over the course of the year.

Australian miners Rio Tinto, BHP, Fortescue Metals Group and South32 have all recently unveiled more than $9.16 billion of shareholder dividends and extra share buybacks.