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Rio Tinto posts $US1.7b half year profit

AAP logoAAP 3/08/2016 Prashant Mehra

Rio Tinto has reported a jump in half year profit to $US1.7 billion ($A2.25 billion) as the mining giant benefits from a rebound in iron ore prices over the last few months.

The main reason for a significant increase from the prior year's half year profit of $US806 million was smaller impairment charges, plus a turnaround from massive losses on US dollar movements in the prior corresponding period.

Rio Tinto's underlying profit for the six months to June 30 was down 47 per cent from a year ago to $US1.56 billion, reflecting a decline in commodity prices over the 12 months.

Revenue in the period of $US15.5 billion was down $US2.5 billion from a year ago.

Underlying earnings fell in the company's iron ore, aluminium, and copper and diamonds operations, but rose in energy and minerals.

"The credit-fuelled bounce in Chinese construction activity has had a positive impact on commodity markets in the first half of 2016, but its impact has been uneven, benefiting most steel raw materials," Rio Tinto said in a statement.

"This has pulled prices up from the multi-year lows seen at the start of the year, as markets continue to rebalance."

Analysts had expected the company to report a half year profit of $US1.5 billion.

Rio Tinto said its capital expenditure is expected to be $US4 billion in 2016 and $5 billion in 2017.

The company has maintained its full year shipment guidance of 350 million tonnes of iron ore, despite posting slightly weaker-than-expected June quarter volumes.


* Half year net profit of $US1.71b, up from $US806m

* Underlying earnings down 47pct to $US1.56b

* Interim dividend down 62.5 cents to 45 US cents per share

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