Rio Tinto announces billions in cuts
Mining giant Rio Tinto said it was targeting five billion dollars of cost savings by the end of 2014 as it voiced 'major uncertainties' about the future growth of the US and Europe.
Mining giant Rio Tinto said it was targeting five billion dollars of cost savings by the end of 2014 as it voiced 'major uncertainties' about the future growth of the US and Europe.
The company said planned spending on exploration and evaluation projects would be reduced by $1bn over the remainder of 2012 and 2013.
Capital expenditure on approved and sustaining projects will taper off from current levels in 2013, while sustaining capital expenditure will drop by more than $1bn next year.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The news was welcomed by investors, who pushed shares up 4.5% by 13:30.
"We are taking further tough action to roll back the unsustainable cost increases of the past few years and are maintaining a relentless focus on improving productivity," said Chief Executive Tom Albanese.
"The short-term macroeconomic outlook remains volatile, with major uncertainties around future US and European economic growth," he said.
However, the firm added it was " guardedly optimistic" on China's prospects, forecasting a light rise in Chinese GDP growth to above eight per cent next year.
It is eyeing strong future earnings potential from iron ore volume increases and higher-priced new titanium dioxide contracts.
-
Most expensive street in Britain to buy on has houses with '£10m average asking price', Rightmove finds
News Rightmove found Buckingham Gate, close to Buckingham Palace, was the most expensive street in the country. Do you live near one that's been included on the list?
By Henry Sandercock Published
-
Smaller companies: starting to turn?
The long-awaited turnaround in smaller companies is unlikely to happen just because shares are lowly-valued. However, an improving economic and interest rate backdrop could spark renewed interest in the sector. M&A activity is also providing support for the smaller companies sector
By MoneyWeek Published