Rio Tinto Ltd (LSE:RIO, ASX:RIO, OTC:RTNTF) shares climbed 1.7% after the miner reported its lowest full-year earnings in five years but pushed back against calls to quit its FTSE 100 listing in London and move to a primary quote in Sydney.
The company posted underlying earnings of $10.87 billion for 2024, down from $11.76 billion the previous year and slightly below analyst forecasts.
Weaker iron ore prices, driven by sluggish demand in China, weighed on results, offsetting growth in copper and aluminium.
Deutsche Bank noted that Rio’s results were slightly weaker than expected, with earnings before interest, tax, depreciation and amortisation (EBITDA) of $23.3 billion, just below the $23.6 billion consensus.
It highlighted that weaker copper earnings were only partly offset by stronger aluminium numbers and lower central costs.
Net debt was higher than forecast at $5.5 billion, due to increased capital spending and lower-than-expected contributions from Rio’s Simandou joint venture partner, though this was mainly a timing issue.
Earnings per share came in at 670 cents, slightly below the 680 cents forecast, while the final dividend of $2.25 per share brought the full-year payout to 60% of earnings, as expected.
While Rio maintained its iron ore production guidance, the company warned that its Pilbara operations now have little room to absorb further weather disruptions.
Deutsche Bank also noted that Pilbara unit costs were slightly higher than expected, suggesting more pressure on profitability if challenges continue.
Rio also rejected pressure from activist investor Palliser Capital and over 100 shareholders to review its dual London-Sydney listing.
CEO Jakob Stausholm told Reuters that the current structure works well for Rio, adding that changing exchanges would not significantly alter the company’s value.
The miner also confirmed it will decide by mid-year on the future of its Tomago aluminium smelter in Australia, which is struggling due to high power prices.