REUTERS - Global miner Rio Tinto reported a more than doubling of its first-half profit on Wednesday and rewarded shareholders with a record interim dividend and an additonal $1 billion share buyback.
Underlying earnings for the six months to June 30 of $3.94 billion missed forecasts for $4.19 billion, according to Thomson Reuters I/B/E/S, but were well above last year’s $1.56 billion on a recovery in iron ore and other commodity prices.
Rio Tinto declared a half-year dividend of 110 cents a share, equivalent to $2 billion, up from 45 cents a share a year ago, while the latest buyback comes on top of a $500 million programme announced in February.
“We are now shifting gear to focus on the untapped value from our productivity programme and continue to strengthen our portfolio to build higher returns for the future”, Chief Executive Jean-Sebastien Jacques said in a statement.
Rio’s London-listed shares were trading down 1.8 percent in early trade.
Iron ore is having a roller coaster ride this year, trading between around $53 and $95 a tonne. Iron ore is now selling for about $74 a tonne.
Capital expenditure is expected to remain at around $5 billion in 2017 and around $5.5 billion in each of 2018 and 2019, the miner said.