Rio Tinto's Underlying Earnings Hold Steady as Copper Strength Offsets Iron Ore Weakness

Rio Tinto reported flat underlying earnings of $10.87 billion for the year ended Dec. 31, matching prior-year levels and slightly exceeding a Bloomberg forecast of $10.81 billion. Improved volumes in copper and aluminium, plus tighter cost control, offset an 11% fall in iron ore EBITDA driven by roughly 6% weaker benchmark prices. Net profit attributable to shareholders fell 14% to $9.97 billion, reflecting higher debt and one-off acquisition items. The miner declared a final dividend of $2.54 per share and says it remains on track for about 3% compound annual growth in copper-equivalent output to 2030, supported by projects including Simandou and lithium expansions in Argentina and Canada.

Key Points

Underlying earnings were flat at $10.87 billion for the year ended Dec. 31, slightly above a Bloomberg forecast of $10.81 billion.
Copper-equivalent production rose 8% and sales volumes increased 5%, driven by Oyu Tolgoi ramp-up and record Pilbara iron ore output, while iron ore EBITDA declined 11% as benchmark prices fell about 6%.
Net profit attributable to shareholders fell 14% to $9.97 billion due to higher debt and one-off acquisition items; the final dividend was set at $2.54 per share, down from $2.55 a year earlier.

Key results and headline figures

Rio Tinto reported underlying earnings of $10.87 billion for the year ended Dec. 31, a level unchanged from 2024 and modestly above a Bloomberg forecast of $10.81 billion. The company attributed the flat underlying result to a combination of stronger copper and aluminium volumes and tighter cost control offsetting weaker iron ore pricing.

Net profit attributable to shareholders declined by 14% to $9.97 billion. Rio Tinto said this reduction reflected higher debt and one-off items connected to acquisitions.

Production and volume drivers

Overall performance was supported by a 5% increase in sales volumes and an 8% uplift in copper-equivalent production. Management highlighted the ramp-up of the Oyu Tolgoi underground mine as a major contributor to copper output gains, alongside record Pilbara iron ore output.

Segment results

Iron ore saw an 11% fall in EBITDA, reflecting benchmark price declines of about 6%. By contrast, copper segment EBITDA more than doubled, a result the company linked to sharply higher production at Oyu Tolgoi. The aluminium and lithium businesses also recorded higher earnings, underpinned by stronger bauxite and alumina production.

Capital returns and shareholder payout

Rio Tinto declared a final dividend of $2.54 per share, slightly below last year’s final dividend of $2.55 per share.

Outlook and growth ambitions

Chief Executive Simon Trott said the company remains on track to deliver about 3% compound annual growth in copper-equivalent output to 2030. Trott cited a pipeline of projects that will support that trajectory, including the Simandou iron ore development in Guinea and lithium expansions in Argentina and Canada.

Notes on the reporting: The company’s commentary tied the year-on-year flat underlying earnings to a mix of higher volumes, improved cost control and offsetting commodity price movements, while net profit was impacted by financing and acquisition-related items.

Risks

Dependence on commodity price movements - weaker benchmark iron ore prices contributed to an 11% decline in iron ore EBITDA, illustrating sensitivity of mining earnings to price volatility.
Balance-sheet and one-off items - higher debt levels and acquisition-related one-off charges reduced net profit attributable to shareholders, indicating financing and M&A costs can materially affect reported profit.
Execution reliance on major projects - the stated plan to achieve about 3% compound annual growth in copper-equivalent output to 2030 is supported by projects such as Simandou and lithium expansions, making delivery contingent on those projects progressing as planned.

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