February 23, 2022
The rise in earnings came despite tight labor market conditions due to coronavirus pandemic restrictions in Western Australia
British-Australian miner Rio Tinto reported a 72% rise in profits, helped by rising iron ore prices and strong demand from China, helping the company declare a record dividend for the year.
The rise in revenue came despite tight labor market conditions due to restrictions related to the coronavirus pandemic and the impact on the ramp-up of its Pilbara projects in Western Australia.
The world’s largest iron ore producer posted underlying profit of $21.38 billion for the year ended Dec. 31, up from $12.45 billion a year earlier.
Analysts had expected underlying earnings of $21.63 billion, according to Visible Alpha.
Rio Tinto announced a record half-year dividend of $7.7 billion. The company’s largest shareholder is Chinese aluminum producer Chinalco, which will receive more than $2.5 billion.
The miner declared a final special dividend of 62 cents per share and a final dividend of $4.17 per share, higher than the final dividend of $3.09 per share a year earlier.
The results reflect a huge demand for raw materials since the start of the pandemic.
BHP, the world’s largest miner, recently declared a record semi-annual dividend of $7.6 billion, while Glencore announced it would pay out $4 billion to shareholders and Antofagasta also set a record dividend of 1, $4 billion on Tuesday.
The results will satisfy Jakob Stausholm, the recently appointed chief executive of Rio Tinto, tasked with improving the miner’s reputation after a series of scandals involving racism, sexual harassment and the destruction of native habitat.
Stausholm has put Rio Tinto’s biggest project – the massive Oyu Tolgoi copper mine in the Gobi Desert – back on track after agreeing to write off $2.4 billion in debt owed by the Mongolian government.
However, Rio Tinto was named among mining companies seeking to expand into protected indigenous lands in the Amazon rainforest in a report released on Tuesday.
Nine mining giants, including Rio Tinto, have filed claims to mine in indigenous reserves in Brazil, even though it is illegal, according to the report by environmental group Amazon Watch and the Indigenous Peoples Association of Brazil.
The report found that mining companies including Glencore, AngloGold Ashanti, Vale and Anglo American have received $54.1 billion in investor funding over the past five years for their Brazilian operations.
He urged banks and financial firms that support these companies to back out of them, saying many also had a track record of human rights abuses and environmental destruction.
- George Russell, with Reuters