Rio Tinto: Iron ore carries the group but still a near miss
About the author:
- Author name:
- By Adrian Prendergast
- Job title:
- Senior Analyst
- Date posted:
- 27 July 2023, 7:00 AM
- Sectors Covered:
- Mining, Energy
- A somewhat fragmented 1H23 result, with a surprisingly strong performance from Rio Tinto's (ASX:RIO) iron ore business, versus the rest of the business which trailed estimates.
- RIO’s group underlying EBITDA of US$11.7bn trailed consensus of US$12.0bn.
- Volatile metal prices continue to impact FCF, with only iron ore meaningfully FCF positive in 1H’CY23.
- Interim dividend of US177cents vs consensus US180cents / MorgE US176cents.
- RIO outlined that it no longer believed it could achieve FY25 emissions reduction targets.
- It has been difficult finding an opportunity to upgrade our investment view on RIO, given the consistency of its investor support. Hold rating maintained.
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