Rio Tinto shareholders in record £6.6bn half-year dividend after China’s demand for iron ore sends profits soaring
Rio Tinto will hand shareholders a record £6.6billion half-year dividend after China’s demand for iron ore sent profits soaring.
The payout, at around 404p per share, is bigger than the amount the FTSE 100 miner gave for the whole of 2020.
China’s rapid recovery from the pandemic has driven a mining boom as the country has stockpiled raw materials.
Digging deep: The payout, at around 404p per share, is bigger than the amount Rio Tinto gave for the whole of 2020
Huge stimulus plans by Western governments have added to the demand.
The world’s largest iron ore miner, Rio’s profits surged to £8.9billion in the first six months of the year, up 271 per cent from £2.4billion in 2020, on revenues of £24billion.
But boss Jakob Stausholm struck a cautious tone on China, noting that sky-high sales early this year were likely to tail off.
The Danish businessman said: ‘The long-term potential for China is intact but we probably have seen a non-sustainable high level of industrial development in some of the months in the first half of this year.’
In an effort to produce even more iron ore last year, the company blew up two 46,000-yearold Aboriginal caves to expand a mine in Western Australia.
But the destruction triggered worldwide outrage, a parliamentary inquiry and led to the departure of then-chief executive Jean-Sebastien Jacques and other executives. Yesterday Rio Tinto said a ‘key focus’ over the coming months was to finalise the ‘appropriate remedy’ for the Juukan Gorge explosions.
The mining group is trying to rebuild its reputation in the wake of the incident – which earned it the nickname ‘Rio TNT’ – and said thousands of workers had completed a virtual reality training programme aimed at making them more aware of cultural heritage.
This week it emerged Rio – up 1.4 per cent, or 86p, to 6127p – is being investigated by the Financial Conduct Authority about whether it put off telling investors about problems with its Mongolian copper project in the Gobi Desert, which could be in breach of listing rules.