You are using an older browser version. Please use a supported version for the best MSN experience.

Rio Tinto targets $5b in extra cashflow

AAP logoAAP 23/11/2016

Mining giant Rio Tinto plans to ramp up productivity to generate an extra $5 billion in free cashflow over the next five years.

Rio Tinto chief executive Jean-Sebastien Jacques says the company will also try to cut $2 billion in cash costs by the end of next year.

He says the company has the right team and culture to prioritise value over volume and to deliver superior shareholder returns.

"We have placed our assets at the heart of the business to drive improved performance and ensure our resilience through the cycle," Mr Jacques said.

"We are well on track to meet our target of $2 billion of cash cost savings by the end of next year. We are also taking advantage of any opportunity to generate value from mine through to market. Lifting the productivity on our $50 billion asset base creates a low-risk and highly attractive return. It will deliver an additional $5 billion of free cashflow over the next five years."

He said Rio Tinto was continuing to reshape its portfolio and, after agreeing to sell its Scottish aluminium assets for $410 million to commodities group SIMEC, "the total of agreed divestments in 2016 now stands at $1.3 billion".

The Scottish aluminium assets include a 100 per cent stake in Alcan Aluminium UK, comprising a smelter and hydroelectric facilities at Kinlochleven and Lochaber as well as associated land.

Mr Jacques said Rio Tinto was also committed to growing its business with a near-term focus on its Silvergrass iron ore project in Western Australia, its Amrun bauxite project in Queensland and Oyu Tolgoi copper and gold project in Mongolia.

image beaconimage beaconimage beacon