Rio shares dip on 12% earnings drop
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The news: Rio Tinto shares lowered after the mining group reported a 12% earnings drop after the market closed on Wednesday.
The numbers: Shares were down 1.1% to $124.34 by 1:30pm AEDT.
Rio posted annual underlying earnings of USD11.8 billion ($18 billion) for 2023, 12% lower than USD13.4 billion a year earlier. Revenue fell 3% to USD54 billion while underlying EBITDA decreased 9% to USD23.9 billion compared to the prior corresponding period.
Rio declared a final dividend of 258 cents per share, up on 225 cents per share in 2022.
Shares were down 1.1% to $124.34 by 1:30pm AEDT.
The context: Analysts were broadly neutral on the results. Barrenjoey analysts said that Rio's earnings were inline with expectations, with the final dividend 5% ahead of consensus.
What they said: "Other than net debt finishing the year above expectations... there was little to concern us," they said. "Rio is well positioned to grow its business, return cash to shareholders and embark on inorganic growth if it so chooses. Iron ore pricing is expected to drive near term performance, but we remain confident of Chinese iron ore demand in 2024."
Macquarie analysts commented: "We believe 2024 could be an inflection year for Rio as the miner continues to deliver on its growth strategy, executing and ramping up projects whilst improving underlying business asset health."
Rio's results were released one day after announcing that it had signed "Australia’s largest renewable power purchase agreement to date", agreeing to buy the majority of electricity from Windlab’s planned 1.4GW Bungaban wind energy project.
The source: ASX announcement
