Rio Tinto fourth quarter production disappoints

20th Jan 2015 07:45

Rio Tinto finished the year with weak fourth quarter results roughly in-line with expectations, with the Anglo-Australian mining giant's production of most metals down on the previous quarter.The FTSE 100 behemoth increased its iron ore output, even as prices have tumbled to a five-year low, with iron ore production of 79.1m tons 12% higher than the same period a year before but came in behind the 82.2m consensus forecast, though shipments of the metal were 17% higher year on year."Output is in line with our targets across all of our major products," maintained chief executive Sam Walsh. "In a challenging market Rio Tinto remains focused on operating and commercial excellence to leverage our low-cost position and maximise value for shareholders."Mined copper production in the quarter of 128.3 kilotonnes (kt) was down 23% on the same period last year and 15% down on the preceding quarter, meaning full year production was 4% higher than last year, driven by the ramp-up at Oyu Tolgoi in Mongolia.This same ramp-up resulted in a 69% increase in annual mined gold production over 2013.Bauxite production of 10,794 kt was down 6% on the same quarter last year and 1% on the previous quarter this year, while aluminium production in 2014 was broadly in line with 2013, with the quarterly figures almost flat, despite the closure of Shawinigan in November 2013 and the partial shutdown at Kitimat.Rio cited "significant productivity gains" across the Australian coal business that helped it deliver annual site production records at Hail Creek in Queensland, Hunter Valley Operations and Bengalla.Although quarter-on-quarter figures showed a fall, excluding production from the Clermont mine which was divested during the year, thermal coal production increased by 15% in 2014 compared to 2013.David Madden at IG said: "Although the miner is trimming production rates across the majority of its minerals to combat crumbling commodity prices, it is still operating in markets where glut, rather than drought, is the order of things."The company will attempt to keep shareholders sweet by increasing its dividend next month in an effort to fend off Glencore's unwanted advances, but the Swiss-based miner won't back down without a fight."