Rio Tinto is a world leader in finding, mining and processing the earths mineral resources. The Groups worldwide operations supply essential minerals and metals that help to meet global needs and contribute to improvements in living standards. Rio Tinto encourages strong local identities and has a devolved management philosophy, entrusting responsibility with accountability to the workplace. Major products include aluminium, copper, diamonds, energy products (coal and uranium), gold, industrial minerals (borax, titanium dioxide, salt, talc and zircon), and iron ore. The Groups activities span the world but are strongly represented in Australia and North America with significant businesses in South America, Asia, Europe and southern Africa. Rio Tinto comprises wholly owned subsidiaries (such as Borax, Comalco, Hamersley, Rio Tinto Coal Australia, Kennecott and Rio Tinto Iron & Titanium), partly owned subsidiaries (Coal & Allied and Palabora) and non-managed, (Escondida) and joint ventures (Grasberg) in which public shareholders, other companies or governments are partners.

            Red = 25 day moving average.           Green = 200 day moving average.

SALES PER ACTIVITY (Data as of 31/12/2005)

Iron:        29%
Coal:       19%
Copper     18%
Aluminum: 14.5%
Minerals:  12.5%
:              6%
Misc:        1%

(Reuters) - Rio Tinto (RIO.AX) rejected a merger approach from smaller rival Glencore Plc (GLEN.L) to create a $160 billion (99.74 billion pounds) mining and trading giant in August just as the price of its most profitable product, iron ore, slid towards a five-year low.

The miner said on Tuesday Glencore had contacted it about a potential merger in July, adding that it turned Glencore down in August and there had been no further contact between the companies on a deal.

A merger would have created the world's biggest miner, supplanting BHP Billiton (BHP.AX).

"The Rio Tinto board, after consultation with its financial and legal advisers, concluded unanimously that a combination was not in the best interests of Rio Tinto's shareholders," Rio Tinto said in a statement to the Australian stock exchange.

given RIO's immediate and outright rejection of any merger, i am very surprised to see the surge in sp being sustained

despite my own support for this stock about a year ago, i am currently staying well away from any hard commodity producers ..... that said, there will certainly come (another) time, when the cycle will turn once more

I, too, think now may not be the right time to chase miners. I think when the
time comes, BLT may be the one to give the lead.

Some comments here about the RIO story.

More

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StockMarketWire.com
Mining titan Rio Tinto has booked FY underlying earnings of $6.53bn, up 78% from $3.67bn. Underlying earnings totalled $9.31bn, down 9% from $10.22bn. Its ordinary dividend per share was 215 cents, up 12% from 192 cents a year ago.

Looking into 2015, Rio said it would retain a tight capital discipline with a focus on cash generation and sustainable returns. It anticipated further cash cost improvements of $750m to be realised 2015, and said capex was expected to decline to less than $7.0bn in 2015 and remain at around $7.0bn in 2016 and 2017.

CEO Sam Walsh said the company had delivered on its commitment to materially hike cash returns to shareholders, which it had delivered via the improved dividend and a proposed $2.0bn share buy-back.

"These represent a total cash return to shareholders, in respect of 2014, of almost $6.0 billion," the company said.

"Our continued financial and operating discipline enabled us to offset much of the impact of lower commodity prices in 2014," Walsh said in a statement.

"By increasing volumes and reducing costs, we achieved underlying earnings of $9.3 billion and we were able to maintain our EBITDA margin2 at 39 per cent. Free cash flow was assisted by a further reduction in capital expenditure3 and a successful programme to release working capital. As a consequence, we have reduced net debt4 by $5.6 billion to $12.5 billion.

"I would like to thank our 62,000 colleagues for their contribution to these excellent results. Decisive early action throughout the Group delivered the strong balance sheet, which enables us to announce today's additional material cash return to shareholders.

"With lower commodity prices and uncertain global economic trends, the operating environment remains tough. However, in these conditions Rio Tinto's qualities and competitive advantages deliver superior value.

"Our combination of world-class assets, disciplined capital allocation, balance sheet strength, operating and commercial excellence, and a culture of safety and integrity gives me confidence in our ability to continue to generate sustainable returns for our shareholders."

Revenues and earnings:
- Consolidated sales revenues of $47.7 billion, as a $5.4 billion (pre-tax) decline in pricing was partially offset by $3.0 billion from higher volumes.

- EBITDA margin at 39 per cent, unchanged from 2013, with volume gains and cost improvements offsetting the impact of lower prices.

- Achieved underlying earnings of $9.3 billion, nine per cent lower than 2013 despite the $4.1 billion (post-tax) impact of lower prices.

- Underlying earnings per share were 503.4 US cents.

- Net earnings of $6.5 billion reflect non-cash exchange rate losses of $1.9 billion, a $0.4 billion charge following the repeal of the Minerals Resource Rent Tax (MRRT) and other charges of $0.5 billion. An impairment charge of $1.2 billion mainly related to the Kitimat project as reported at the half year was mostly offset by a reversal of $1.0 billion in the second half of 2014 related to an uplift in carrying value for the Pacific Aluminium business.

Production:
- Set production records for iron ore and Hunter Valley thermal coal, and delivered a strong operational performance in bauxite, copper and aluminium.

CitiBank summary:
"RIO Downgrade to Neutral — RIO’s net debt rises ~US$1b in 2015, before completion of remaining US$1.4b on-market buyback. As with BHP, the key question is whether a yield of greater than 5% is enough to offset iron ore price headwind and lack of cash flow generation. We downgrade RIO to Neutral, previously Buy."

StockMarketWire.com
Rio Tinto is preparing its first shipments of metal from its Kitimat aluminium smelter, Canada, following an extensive modernisation of the facility.

The modernisation of the aluminium smelter will increase production capacity by 48 per cent and result in Kitimat becoming one of the lowest cost smelters in the world. Rio is now focused on safely ramping up towards its annual production rate of 420,000 tonnes.

The modernised smelter, which was delivered in line with the revised schedule and budget, is powered exclusively by Rio's wholly owned hydro power facility and uses the company's proprietary AP40 smelting technology which will effectively halve the smelter's overall emissions.

Credit Suisse note:
"RIO TINTO (NEUTRAL, TP £25): Target price lowered to £25 from £28. It is tempting to be relatively positive on the outlook for RIO given its strong balance sheet, dividend yield (6%), on-going buyback program, well regarded management team and an enviable iron ore business. However looking ahead the commodity mix remains a concern with the two largest businesses, iron ore and aluminium, both continuing to exhibit supply characteristics that have the potential to overwhelm demand. We remain bearish on the outlook for both iron ore ($45/t in 2016 and 2017) and aluminium prices, and this contributes to the high 2016 PE (23x). With relatively strong but declining earnings profile, little chance of a dividend cut and a real possibility of extending the buyback program in 2016 (coal asset sale would help, book value $3bn) we see Rio as a defensive option within the mining space. Catalyst: Possible sale of coal business, continuing pressure on iron ore prices, capex approvals (bauxite) in Q4. We set our target price at a PE of 20x 2017 earnings and 6.5% dividend yield. On our 2016 earnings, Rio generates $2.5bn of FCF and has a dividend commitment $3.9bn for a near $1.5bn increase in net debt assuming no further asset sales."

Was only looking at RIO and BLT at the weekend thinking at multi-year lows got to be thinking about adding here. Sharp rise today but suspect when China is back next week some negative sentiment will return. Can't believe it's all over.

What is positive sentiment returns from China.
Things are portrayed too negatively in the west.

Still oversupply, so more likely lower short term prices in my opinion. But good idea to start acquiring for the longer term.

Such a high yielder here but will the divi go just like Glencore? I'd like to buy both RIO/BLT but not convinced this is the bottom.

Nice gains today. Also bought some AIGI industrial metals as at multi year lows. Did buy RIO yesterday fortunately.

StockMarketWire.com
Rio Tinto has issued strong Q3 production results. It cited efficient output, rigorous cost control and sound allocation of capital.

Global iron ore shipments totalled 91.3 Mt, up 17% on the year, with global iron ore production at 86.1 Mt, up 12%. Bauxite output was 11,287 kt, up 4%, and aluminium production was 830 kt,m up 1%.

However, mined copper production was 115 kt, down 24% on the year. Hard-coking coal output was 1856 kt, up 5%, while semi-soft and thermal coal was at 5546 kt, down 8%. Titanium dioxide slag output was 243 kt, down 34%.

CEO Sam Walsh commented on the company's production stance:

"This approach is ensuring that our tier one assets generate substantial free cash flow even during a challenging economic environment.

"Our expanded Pilbara infrastructure is in place, and the Iron Ore Product Group is successfully commissioning and testing the system, reflected in the increased iron ore shipments to our customers during the period.

"Our cash generated from operations will enable us to deliver strong returns to shareholders through the cycle and our balance sheet will be further strengthened by recent divestment activity."

Investec raise to buy.

Credit Suisse today reaffirms its neutral investment rating on Rio Tinto PLC (LON:RIO) and cut its price target to 2100p (from 2400p).

StockMarketWire.com
Rio Tinto said global iron ore shipments totalled 336.6 million tonnes in 2015, marginally below its guidance of 340 MT but up 11% on 2014. At 327.6 MT, global iron ore output was also up 11% on 2014.

"In 2015, we delivered efficient production, meeting our targets across all of our major products, while rigorously controlling our cost base," said CEO Sam Walsh in a statement.

"We will continue to focus on disciplined management of costs and capital to maximise cash flow generation throughout 2016."

Meantime, semi-soft and thermal coal production was overall flat at 22,285 kt. Output of bauxite, aluminium and hard coking coal was up. However, mined copper production fell 16% to 504.4 kt, while titanium dioxide slag tumbled 25% to 1089 kt.

StockMarketWire.com
Rio Tinto has swung to a FY pretax loss of USD726m, from a profit of USD9.55bn a year earlier. Consolidated sales revenue was USD34.83bn, from USD47.66bn. It maintained its FY dividend at 215p a share.

CEO Sam Walsh described the performance as "strong" against a "highly challenging" environment.

"We continued to take decisive action to preserve cash through further cost reductions, lower capital expenditure and the release of working capital. This focus on cash resulted in operating cash flows of $9.4 billion," he said in an earnings statement.

"At the same time, we have significantly strengthened our balance sheet and finished 2015 with net debt of $13.8 billion, which is $700 million better than the $14.5 billion pro-forma position at the end of 2014.

"The continued deterioration in the macro environment has generated widespread market uncertainty. We are embarking on a new round of proactive measures to cut our operating costs by a further $1 billion in 2016 followed by an additional goal of $1 billion in 2017.

"We are also reducing our capital expenditure to $4 billion in 2016 and $5 billion in 2017, an overall reduction of $3 billion compared with our previous guidance.

"These significant actions provide us with the confidence that we remain robustly positioned to maintain both balance sheet strength and deliver shareholder returns through the cycle."

BIG PICTURE
"The slowdown in emerging markets limited global growth to around 3 per cent in 2015. The impact on commodity demand was much stronger, led by a further deterioration in key metals-intensive sectors in China.

"In response, high-cost marginal supply is seen exiting across most markets. This is a slow process. Without a turnaround in demand it is difficult to see these supply withdrawals having strong positive price impacts in the short term.

"The macro-economic consensus points to a moderate improvement in global growth in 2016, but volatility in financial and oil markets is a strong sign that macroeconomic risks abound, with geopolitical concerns also not far in the background.

"Longer term, demand prospects remain positive and we expect this will support a recovery from the current cyclical low phase."