Australian miner Rio Tinto’s FY2020 underlying earnings increased by 20pc from a year ago to $12.4bn, according to the company’s FY2020 results release. The company’s underlying EBITDA rose to $23.9bn, up 13pc from a year ago, with an EBITDA margin of 51pc. Earnings improved due to higher iron ore prices in 2020, which accounted for 90pc of Rio’s earnings, along with strength in copper, partly offset by lower aluminium, alumina and bauxite prices. Net profit in 2020 was $9.8bn compared to $8bn in 2019.
In 2020 underlying EBITDA rose by $3,407mn from 2019, supported by an increase in iron ore prices adding $3,262mn and copper adding $405mn, while aluminium, alumina and bauxite lowering EBITDA by $314mn. On average Fe 62pc fines rose by 19pc compared to 2019, amid continued seaborne supply disruptions and robust demand for steel in China. In 2020, London Metal Exchange (LME) average price for copper rose by 3pc, while LME aluminium fell by 5pc from a year ago.
Production guidance for FY2021 remains unchanged from Q4 operational review, wherein the company forecast Pilbara iron ore output to be stable at 325-340mn mt and lowered copper guidance to 500,000-550,000mt.
Last year, Rio Tinto introduced new Scope 1 and 2 targets and on Wednesday, the company set out new Scope 3 emissions goals to lower emissions by guiding the company’s partners across its value chain. The company will work in partnership with customers to develop new technologies to lower steelmaking carbon intensity by 30pc by 2030 and develop potential carbon-neutral steelmaking pathways by 2050. Rio will also focus on plans to meet its net-zero emission target from the shipping of products by 2050, and comply with International Maritime Organisation (IMO) goal of reducing shipping carbon mission intensity by 40pc by 2030.
Rio Tinto’s newly appointed Chief Executive Jakob Stausholm called the year 2020 an extraordinary year and reiterated the company’s resolve to focus on operational performance and climate strategies. He added the company is working toward building trust with the traditional owners including the Puutu Kunti Kurrama and Pinikura (PKKP) people following the tragic event at the Juukan Gorge. a