Rio Tinto posts 10% drop in first-half revenue, cuts dividends, but posts 13.4% yield

by , editor of Benzinga

July 27, 2022 6:15 p.m. | 1 minute read

Rio Tinto plc RIO reported first-half consolidated sales of $29.8 billion, down 10% year-on-year. Underlying EBITDA was $15.6 billion, down 26% year-on-year, and net income was down 29% year-on-year to $8.6 billion. Operating cash flow for the first half was $10.5 billion, compared to $13.7 billion in the first half of 2021. RIO cut its dividend by 53% year-on-year to $4.3 billion, or $2.67 per share. This represents 50% of operating profit, in line with the shareholder return policy. The underlying ROCE is 34% against 50% in H1 2021. After the dividend cut, RIO's dividend yield is still as high as 13.42% The company held $0.3 billion in net cash as of June 30, 2022, which, compared to net cash of $1.6 billion at the start of the year, reflected free cash flow of 7.1 billion, offset by $7.6 billion in cash returns to shareholders and the $0.8 billion acquisition of Rincón. Guidance for FY22: Company expects capital investment share of approximately $7.5 billion (previously $8.0 billion) in 2022. In 2023 and 2024, it expects capital investment share in capital of 9.0 to 10.0 billion dollars. RIO expects Pilbara iron ore unit cash costs to be $19.5-21.0 per tonne, at an Australian dollar exchange rate of 0.71 (previously 0.75), at excluding any additional COVID-19 response costs. Price Action: Shares of RIO are trading down 0.76% to $58.97 in Wednesday's post-trade session. E...