Rio Tinto posts annual loss of $3bn

Figures slightly better than market expectations.

New Statesman
Rio Tinto's iron ore operations in western Australia. Credit: Getty Images.

The Anglo Australian metals and mining group Rio Tinto has posted a net loss of $3bn in 2012 taking impairment of $14.4bn on its aluminium businesses and coal assets in Mozambique.

Underlying earnings declined by 40 per cent to $9.3bn due to weaker commodity prices.

Sam Walsh, CEO of Rio Tinto Group, said: “Under my leadership, Rio Tinto will have an unrelenting focus on pursuing greater value for shareholders. To do this we need to run the business as owners not managers and my immediate priority is to build more focus, discipline and accountability throughout the organisation.”

Walsh said the company would strengthen existing management systems and would only invest in assets that “offer attractive returns that are well above our cost of capital”, and offered a superior return “when compared to returning cash to shareholders.”

As well as cutting cost to save more than $5bn by the end of 2014, Walsh said Rio the company is also considering selling its non-core businesses in 2013.

 “Looking ahead, we see the positive momentum in the fourth quarter of last year being sustained into 2013 with Chinese GDP growth returning to above 8 per cent in 2013,” Walsh added.

Meanwhile, the company is continuing its partnership with the government of Mongolia over the Oyu Tolgoi gold-copper project.

The company declared a full-year dividend of $1.67.

In addition, the company appointed Andrew Harding as the new head of its iron ore division.