⛏️ Rio Tinto: Profits steady despite iron ore slump, copper and lithium investments up!

Rio Tinto $RIO, one of the biggest mining giants, has kept profits at a similar level to 2023 even as iron ore prices fell by 11 %. This result underlines the diversification of the portfolio as higher profits from copper and aluminium helped offset losses from the core business.

📌 Key financial results for 2024:
Underlying earnings: US$10.9 billion (vs. expectations of US$11 billion)

Underlying cash flow profit: USD 23.3 billion (vs. expectations of USD 23.8 billion)

Copper EBITDA: USD 3.4 billion (vs. USD 2 billion in 2023)

Aluminium EBITDA: USD 3.7 billion (significant growth)

Iron ore EBITDA: USD 16.2 billion (vs. USD 20 billion in 2023)

📉 Highlights of the results
Dividend reduced by 8% - still at the upper end of the payout policy (40-60% of underlying earnings).

Iron ore yield down to 70 % of total EBITDA (vs. 78% in 2023).

Increased capital expenditure - USD 9.5 billion in 2024, expectations for the year 2025: USD 11 billion.

🌍 New investments: copper, lithium and mining expansion
Rio Tinto is actively investing in diversifying production, which can help reduce reliance on iron ore.

New Simandou iron ore mine (Guinea) - is due to start mining this year, with production expected to reach 27 million tonnes per annumby 2028.

Copper expansion - rising copper profits suggest increased demand, which will be important for industrial electrification and electric vehicles.

Lithium as a key raw material for batteries - acquisitions Arcadia per USD 6.7 billion + green light for the project Rincon v Argentina.

💬 CEO Jakob Stausholm: "We are increasing investment to support our plans for 10 years of profitable growth."

Rio Tinto is facing pressure from activist investors from Palliser Capital, who are pushing for a unified listing in the Australia.

Rio Tinto currently has a dual structure (UK & Australia), which critics say complicates management and mergers.

BHP $BHP decided to unify its listing in 2022, leading to greater efficiency.

A shareholder vote will take place at the AGM in April - a decision that could affect the company's future growth.

Rio Tinto but says the current structure is advantageous because of greater flexibility for mergers, acquisitions and access to capital.

How do you see the future of the mining giants?