Rio Tinto Plc · LSE:RIO
Rio Tinto — Bank of America Merrill Lynch conference 2013
15 slides from Rio Tinto's conference presentation, May 14, 2013
Slide 1: Pursuing greater value for shareholders
14 May 2013 Pursuing greater value for shareholders Bank of America Merrill Lynch conference
Slide 2: Cautionary statement
2 Cautionary statement This presentation has been prepared by Rio Tinto plc and Rio Tinto Limited (“Rio Tinto”) and consisting of the slides for a presentation concerning Rio Tinto. By reviewing/attending this presentation you agree to be bound by the following conditions. Forward-looking statements
Slide 3: A consistent strategy with clear priorities
3 A consistent strategy with clear priorities • Maximise total shareholder return • Invest in and operate large, long-life, low-cost, expandable operations • A clear agenda for 2013 − Reducing costs and improving performance at all operations − Reinforcing capital allocation discipline − Divesting n
Slide 4: Improving performance at existing operations
4 Improving performance at existing operations • Building a stronger, more focused and accountable business − Running the business as owners − Major operating model review − Incentives aligned to individual value delivery • $2 billion cash cost reduction in 2013 vs 2012, and a further $1 billion in
Slide 5: > 1500 separate cost reduction initiatives being implemented across the business
5 > 1500 separate cost reduction initiatives being implemented across the business Energy Aluminium Iron ore 500+ initiatives 500+ initiatives 350+ initiatives • Reduced spend on procured goods and • Production cost improvements including • Supply chain initiatives in the Pilbara services ($370m in
Slide 6: On track to achieve $750 million reduction in exploration and evaluation spend in 2013
6 On track to achieve $750 million reduction in exploration and evaluation spend in 2013 Delivering on expn & evaln cost reductions • First quarter 2013 spend $275 million Q1 exploration and evaluation cost, US$ million less than 2012 (>50% reduction) 600 • Strong project pipeline to supply 500 futu
Slide 7: Reinforcing capital allocation discipline
7 Reinforcing capital allocation discipline • Disciplined and rigorous approach Cash from operations to capital allocation and divestment proceeds • Investment programme focused on highest quality opportunities Disciplined Prudent Cash investment in balance returns to • Evaluate investment opportuni
Slide 8: Capital expenditure tapering off as projects deliver strong near-term growth
8 Capital expenditure tapering off as projects deliver strong near-term growth Approved capital expenditure Rio Tinto copper equivalent production US$ billion 2012 = 100 20 CAGR 140 > 8% 15 120 100 10 80 60 5 40 20 0 2011 2012 2013F 2014F 2015F 0 2012 2013F 2014F 2015F 2016F Sustaining Pilbara Susta
Slide 9: Recovery at Bingham Canyon underway
9 Recovery at Bingham Canyon underway • Proactive management plan ensured safety and minimized equipment damage • Rapid restart of operations at Cornerstone • Achieved first ore production from First ore delivered to mill the mine, supplemented with stockpile ore • Smelter and refinery continue to o
Slide 10: Ramp up to commercial production at Oyu Tolgoi is progressing well
10 Ramp up to commercial production at Oyu Tolgoi is progressing well • Open-pit mine and concentrator complete, within 3% of budget • Currently producing up to 60kt per day through the concentrator • Targeting consistent production rates at 70kt per day by the end of June Bagged concentrate • First
Slide 11: Pilbara iron ore 290Mt/a expansion is approaching completion
11 Pilbara iron ore 290Mt/a expansion is approaching completion • Expansion programme on budget and on time for accelerated ramp-up • 55 Mt/a shiploader now installed at Cape Lambert • Major coastal infrastructure for 290 Mt/a is fully constructed Shiploader in place • Wharf piling for 360 Mt/a comp
Slide 12: Pilbara 360Mt/a expansion underway with multiple options for mine capacity growth
12 Pilbara 360Mt/a expansion underway with multiple options for mine capacity growth Mine capacity options • Infrastructure expansion to 360 Mt/a Average annualised (Mt/a) fully approved and underway 400 • Multiple options for mine capacity 375 expansion are being evaluated 350 • Major low cost prod
Slide 13: Asset quality and marketing leadership drive consistently superior returns from the Pilbara
13 Asset quality and marketing leadership drive consistently superior returns from the Pilbara WA IO – EBITDA per tonne • Lowest cost producer in the Pilbara (US$/t and %) • 2012 cash cost: US$23.50/tonne 140 80% • Consistently achieving a premium 120 70% relative to Platts 62% Fe for spot 60% 100 s
Slide 14: Making progress on our clear strategic priorities
14 Making progress on our clear strategic priorities • Clear strategy and direction • A stronger, more focussed and accountable business • On track to achieve cash cost improvements • Delivering approved growth projects on budget and on time • Reinforcing capital allocation discipline • Pursuing gre
Slide 15: Pursuing greater value for shareholders
14 May 2013 Pursuing greater value for shareholders Bank of America Merrill Lynch conference
Rio Tinto — Bank of America Merrill Lynch conference 2013 on 6ix