Rio Tinto Full-Year Earnings Report 2023

Rio Tinto to Report Full-Year Earnings for 2023

Rio Tinto, the world’s second-biggest miner by market value, is set to reveal its full-year earnings for 2023 after the Australian market closes on Wednesday. Here’s a rundown of what to expect:

Profit Forecast

The company is anticipated to post $11.64 billion in annual underlying earnings, excluding certain one-time charges. This estimate is based on a consensus compiled by Visible Alpha from 18 analyst forecasts. In comparison, Rio Tinto reported underlying earnings of $13.28 billion the previous year.

Dividend Forecast

Rio Tinto is projected to distribute total dividends amounting to $4.23 per share for 2023, as per the Visible Alpha-compiled consensus. In the 2022 fiscal year, the miner paid out $4.92 per share in dividends.

Key Points to Monitor:

Payout Ratio

Rio Tinto’s dividend policy aims to distribute between 40% and 60% of underlying earnings to shareholders over industry cycles, with payouts concentrated at year-end. Analysts from Macquarie note that the miner has consistently paid out 60% of underlying earnings for the past seven years. The consensus for 2023 suggests a 59% payout ratio.

Growth Projects

Rio Tinto has several projects in progress, particularly in lithium and iron ore. The development of the significant Simandou iron-ore project in Guinea, which Rio Tinto estimates will cost approximately $6.2 billion, is likely to attract investor attention.

Cost Guidance

With annual results, Rio Tinto is expected to provide guidance on projected 2024 costs for its Australian iron-ore business and copper operations. Final figures for 2023 costs in these sectors will also be disclosed. Analysts at Macquarie point out a wide range of earnings forecasts for Rio Tinto’s iron-ore segment in 2023, indicating differing opinions on cost performance within the division.