Prices for iron ore, Rio's primary earner, stayed between the US$60 to US$70 range through the year, helped by strong continuing demand from Chinese steel mills. Picture / Getty Images
Prices for iron ore, Rio's primary earner, stayed between the US$60 to US$70 range through the year, helped by strong continuing demand from Chinese steel mills. Picture / Getty Images
Rio Tinto's full year net profit has soared 90 per cent to US$8.76 billion ($12b), helped by stronger iron ore and coal prices in 2017.
The mining giant said higher prices boosted its underlying earnings by US$4.1b in the 12 months to December 31.
Rio's underlying earnings, which excludes impairmentsand exchange losses, rose 69 per cent to US$8.63b, matching analyst expectations.
Chief executive Jean-Sebastien Jacques said Rio would deliver cash returns of US$9.7b to its shareholders for 2017, through an increased dividend and share buy backs, including an additional US$1b buy back of London-listed shares.
"The strength of our cashflow is a result of resilient prices during the year coupled with a robust operational performance and a focus on mine to market productivity," he said.
A final dividend of US$1.80 per share takes Rio's full-year dividends to a record US$2.90, from US$1.70 in 2016.
Prices for iron ore, Rio's primary earner, peaked at nearly US$95 a tonne in February 2017, but have stayed between the US$60 to US$70 range through the year, helped by strong continuing demand from Chinese steel mills.
The company's underlying earnings from iron ore increased 35 per cent to US$11.5b, while earnings from its energy division, which includes its metallurgical coal operations, rose 55 per cent to US$2.8b.
Rio Tinto expects capital expenditure to remain at about US$5.5b in 2018 and US$6b in both 2019 and 2020.
