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On 18 January 2019, leading mining group, Rio Tinto Limited (ASX:RIO) announced its business results for Q4 2018.
As stated by Rio Tinto chief executive J-S Jacques: RIO displayed robust performance in Q4 2018, with notable results across copper assets. The company further aims to strengthen asset portfolio, undertake key business decisions and yield enhanced returns to shareholders in the future.
Iron Ore
- Pilbara operations yielded 337.8 million tonnes (Rio Tinto share 281.8 million tonnes) in FY18, representing an upside of 2% over FY17, attributable to the ramp-up of mines and reduced weather shocks.
- Q418 output of 86.6 million tonnes represents a downside of 1% over Q417.
- Q418 sales of 87.4 million tonnes was a reduction of 3% over Q417.
- Successful deployment of AutoHaulâ¢, worldâs first automated heavy-haul, long-distance rail network, has taken place.
- Investment of $1.55 billion was approved at two projects to sustain production volume at the Robe River JV.
- 2019 guidance of 338-350 million tonnes for the companyâs Pilbara shipments.
Bauxite
- Q418 output was 14% lower than Q417. FY18 output of 50.4 million tonnes was 1% lower than FY17 owing to the work at CBG in Guinea, and the operations shift from East Weipa to Queensland.
- 2019 guidance of 56-59 million tonnes is anticipated.
Aluminium
- FY18 output of 3.5 million tonnes was 3% lower than FY17 owing to the labour unrest at the Becancour smelter.
- 2019 guidance of 3.2-3.4 million tonnes is anticipated.
Copper
- Mined copper output was reported to be 37% higher and refined output 55% higher than the previous year, mainly attributable to strong performance at Escondida and increased production from Kennecott.
- 2019 guidance of 550k-600k tonnes is anticipated.
Miscellaneous details
- Titanium dioxide slag output of 1.1 million tonnes was 15% less than the previous year.
- Q418 output at Iron Ore Company of Canada increased by 4% as compared to Q417.
Corporate Update
- The company completed the sale of Grasberg mine in Indonesia for $3.5 billion, aluminium smelter at Dunkerque, France for $0.4 billion, a wharf and land in Kitimat, British Columbia for $0.6 billion and coking coal assets for $4.1 billion.
- An agreement with China National Uranium Corporation was signed for the sale of its entire 68.62 per cent stake in Rössing Uranium, expected to be completed by 1H19.
- $5.4 billion of shares were brought back including an off-market buy-back tender in Rio Tinto Limited shares for $2.1 billion and further on-market purchases of Rio Tinto plc shares of $3.3 billion.
- 1H18 saw the negative impact to EBITDA resulting from raw material input price inflation, particularly in the Aluminium business, and the escalation of alumina index prices which impacted its alumina legacy contracts. These trends have continued to be observed in the second half of 2018.
Stock performance
Post the Q4 performance update, the shares of Rio Tinto closed the dayâs session up by 0.31% at A$80.650. RIO stock is trading high this year offering a 4.89% return to the investors.
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