Rio Tinto Plc · LSE:RIO
Rio Tinto — Investor Day (October 2019)
94 slides from Rio Tinto's investor day presentation, Oct 31, 2019
Slide 1: Investor seminar: Strength and resilience
For personal use only Investor seminar Strength and resilience
Slide 2: Cautionary and supporting statements
Cautionary and supporting statements For personal use only This presentation has been prepared by Rio Tinto plc and Rio Tinto Limited (“Rio Tinto”). By accessing/attending this presentation you acknowledge that you have read and understood the following statement. Forward-looking statements This doc
Slide 3: Cautionary and supporting statements (cont.)
Cautionary and supporting statements (cont.) For personal use only The Competent Persons responsible for reporting in Rio Tinto’s 2018 Annual Report the Ore Reserve and Mineral Resource estimates in this presentation were: Association1 Employer Accountability Deposits Bauxite L McAndrew AusIMM Reser
Slide 4: Agenda
Agenda For personal use only Time Topic Who J-S Jacques 08:00-08:25 Strength and resilience Chief executive Vivek Tulpule 08:25-08:45 Connected to our markets Head of Economics & Markets Simon Trott Maximising the value of physical flows Chief Commercial Officer Chris Salisbury 08:45-09:05 Iron Ore:
Slide 5: J-S Jacques, Chief executive
For personal use only J-S Jacques Chief executive
Slide 6: Sector-leading financial performance
Sector-leading financial performance For personal use only $8bn $15bn + $3.5bn2 Sustaining capex Ordinary dividends paid 2019 interim and special dividends 42% average EBITDA margin1 17% $41bn operating cash flows $8bn $53bn $4bn average ROCE1 + $12bn Growth capex of cash Buy-backs divestments (2016
Slide 7: Compelling purpose and sustainability drive
Compelling purpose and sustainability drive For personal use only Running a safe, Collaborating to Pioneering responsible and enable long-term materials for profitable business economic benefits human progress 0.44 AIFR1 $6.6bn Elysis In 2018 vs 0.68 for ICMM2 23 companies paid in taxes and royaltie
Slide 8: We are facing a 'New Era' of complexity
We are facing a ‘New Era’ of complexity For personal use only Growing geopolitical tensions Higher societal expectations Technological disruptions 8 ©2019, Rio Tinto, All Rights Reserved
Slide 9: This New Era is framed by three global scenario forces
This New Era is framed by three interconnected global scenario forces For personal use only Positioning our business for success through value over volume Geopolitics Society Technology Partnerships ESG / Carbon abatement Mining innovation Partnering across the value chain New Rio Tinto emission tar
Slide 10: Our strategy is clear and consistent
Our strategy is clear and consistent For personal use only Superior cash generation World-class assets Operating and Commercial excellence Capabilities Portfolio Performance People & Partners Disciplined capital allocation Balance sheet strength Superior shareholder returns Creating growth options 1
Slide 11: Portfolio: quality, diversified assets
Portfolio: quality, diversified assets For personal use only Commodity Iron ore Aluminium Copper Minerals Strategic approach Optimise and flex Protect and fix Unlock growth Develop opportunities Priorities Value over Volume Production creep Fast-track options from exploration Value over Volume Produ
Slide 12: Portfolio: creating options through exploration
Portfolio: creating options through exploration For personal use only Projects located mainly in lower risk jurisdictions 2019 exploration expenditure 2019 exploration expenditure by commodity by project stage 5% 5% 7% 3% Copper Target Generation Diamonds Target Testing 27% Nickel 27% Project of Mer
Slide 13: Performance: safety, operational and commercial excellence
Performance: safety, operational and commercial excellence drive superior margins and returns For personal use only Zero fatalities our priority Relentless focus on operational excellence Commercial insights boost profits A safe and well run business Addressing the challenges: strong recovery Active
Slide 14: People: building capability to drive performance
People: building capability to drive performance For personal use only Centres of Excellence enabling decision making - Open Pit Mining - Processing - Underground Mining - Energy and Climate Change Commercial hub for sales, procurement and partnerships Significant increase in employee engagement acr
Slide 15: Partners: working with others for future success
Partners: working with others for future success For personal use only Path to carbon free smelting Industry standards for sustainable development Sustainable approach to meeting the Lifesaving connections for rural communities resource needs of green energy Australia’s first nationally accredited S
Slide 16: A disciplined business generating strong returns over the cycle
A disciplined business generating strong returns over the cycle… For personal use only Strength and resilience from: Resilient group margin and returns through the cycle 47% Quality of our assets 44% 44% 44% 42% 39% 39% 38% Capability of our people 33% 35% 34% Operational performance 25% 23% 23% Inn
Slide 17: …with a focus on free cash flow generation
…with a focus on free cash flow generation For personal use only Free cash flow through the cycle $ billion 13.7 Updated capital allocation framework New returns 9.5 10 7.7 policy 6.9 7.0 5.8 4.8 3.9 2.1 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019F* (8.1) Free cash flow is defined as net
Slide 18: Vivek Tulpule: Connected to our markets
For personal use only Vivek Tulpule Connected to our markets
Slide 19: Near-term uncertainties but policy is supportive
Near-term uncertainties but policy is supportive For personal use only Manufacturing sentiment in contraction in all 4 major economies Chinese GDP continues to grow strongly but at a slowing pace PMI Index Real GDP (2018 $bn)1 65 20,000 60 +5.8% 55 15,000 50 +7.1% 45 10,000 40 35 5,000 30 25 0 2000
Slide 20: Long-term trends support further growth in commodity demand
Long-term trends support further growth in commodity demand For personal use only Per capita commodity consumption1 Key takeaways Macro fundamentals remain supportive of ongoing India ASEAN China Japan demand growth in commodities Global steel consumption forecast to grow by 1%-2% Steel 64kg 121kg 5
Slide 21: Demand for iron ore well supported
Demand for iron ore well supported For personal use only Obsolete scrap usage is growing in China but constrained Iron ore demand growth depends on scrap consumption and by segregation costs & EAF/BOF1 economics India’s requirement for imported Iron ore China steel scrap consumption (Mt) Contestable
Slide 22: Iron ore will remain attractive for incumbents
Iron ore will remain attractive for incumbents For personal use only Steep Iron ore cost curve supports healthy margins But the industry requires greenfield projects to maintain for low cost producers production which could cost up to $200/t 2019, CFR China Value in Use Adjusted Cash Cost Industry i
Slide 23: Aluminium market challenged by flat cost curve
Aluminium market challenged by flat cost curve For personal use only Rio Tinto’s Canadian smelters are in the bottom decile Global demand for primary aluminium forecast Aluminium Cost Curve, ($/t, 2019) to grow by 2.0% - 2.5% CAGR (2018-30) Aluminium demand growth supported largely by transport and
Slide 24: Electrification: exploring opportunities and markets
Electrification: exploring opportunities and markets For personal use only Higher Electric Vehicle (EV) penetration to support demand Nickel EV demand Consensus range (Mn units) Batteries evolve towards higher energy density nickel rich chemistries 60 Long lead times, high capital costs, complexitie
Slide 25: Simon Trott: Maximising the value of physical flows
For personal use only Simon Trott Maximising the value of physical flows
Slide 26: We ensure our business is optimising value
We ensure our business is optimising value For personal use only Driving end to end optimisation Providing market insights Processing & refinement Deepen understanding of our value chain and monetise Logistics & delivery information flows Mining & extraction Building commercial excellence Ensure we
Slide 27: Close to our global customers and suppliers
Close to our global customers and suppliers For personal use only 19% of sales to North America in 2018 66% of sales to Asia in 2018 Commercial organisation $7.6bn in sales1, ~90% sourced within North America $26.6bn in sales1 Sales & Marketing $3.4bn in supplier spend1 $7.7bn in supplier spend in A
Slide 28: Our Pilbara Blend is the single largest, most liquid product
Our Pilbara Blend is the single largest, most liquid and consistent product For personal use only Baseload for China mills Quality consistency Superior value for Pilbara Blend Fines (PBF) Our Pilbara Blend (PB) is a key input to customers We maintain Pilbara Blend quality by blending …thus deliverin
Slide 29: Our diversified portfolio of products optimises end-to-end value
Our diversified portfolio of products optimises end-to-end value For personal use only Diversified portfolio of products1 Continuously optimising end-to-end value We market our high liquidity Pilbara Blend, plus a suite of products to meet the From pit to furnace: we link our customers to our assets
Slide 30: Customers are at the centre of our commercial activities
Customers are at the centre of our commercial activities For personal use only Technical engagements with customers to understand changes in their operations and inform our product offerings Joint Work Programme with Asian mills to improve Strengthen our customers’ lump rescreening and increase thei
Slide 31: Maximising value from our aluminium product portfolio
Maximising value from our aluminium product portfolio For personal use only Bauxite: Developing new markets Alumina: Globally traded book Aluminium: VAP sales We create demand for our products through technical Provides ability to balance Atlantic needs and To generate additional margin, regional op
Slide 32: Tailoring assets and product suite to market dynamics in TiO2 and copper
Tailoring assets and product suite to market dynamics in TiO2 and copper For personal use only TiO2: market leader with unrivalled product offering Copper: Positioning our assets to outperform in the market We flex volumes, grades and products to meet the needs of the market Unique position to lever
Slide 33: We are maximising the value of our physical flows
We are maximising the value of our physical flows For personal use only Harnessing our vast network of information & insights across markets, supply chain and procurement Driving commercial insight across the business to continuously optimise end-to-end value Maximising the value of our physical flo
Slide 34: Chris Salisbury: Iron Ore: optimise and flex
For personal use only Chris Salisbury Iron Ore: optimise and flex
Slide 35: World-class system delivering outstanding returns
World-class system delivering outstanding returns For personal use only World-class assets and significant resource base Rio Tinto Iron Ore EBITDA and ROCE performance EBITDA margin 1 / ROCE 2 % 100 120 80 Price $ per tonne 3 Highly-valued product suite 60 60 40 Exclusive fully-integrated system cre
Slide 36: Solid mine performance
Solid mine performance For personal use only Annualised tonnes produced in Q3 2019 Total Material Moved Indexed to 2019 YTD Sales Product Split (RT Share) (number of weeks) 2018 Actual (Mt) 1.15 5 360 80 4 1.06 60 3 # weeks 1.0 0.98 2 40 1 20 0 0 320 330 340 350 360 370 380 390 400 Q1 Q2 Q3 PBF PBL
Slide 37: Productivity focus to maximise financial results from assets
Productivity focus to maximise financial results from assets For personal use only Haul Truck Effective Utilisation Excavator Mean Time Between Failure Fixed Plant Conveyor Unscheduled Loss (Indexed to 2018 Actuals) (Hrs Indexed to 2018 Actuals) (Mt Indexed to 2018 Actuals) 1.18 1.10 1.06 1.08 1.06
Slide 38: Rail improvements to drive capacity and flexibility
Rail improvements to drive capacity and flexibility For personal use only Annualised Railed Tonnes Run Rate (Mt)1 Annualised Tonnes Railed in Q3 2019 TSR3 Average Cycle Time Impact (number of weeks)2 Indexed to December 20182 345 338 5 360 1.0 0.99 328 0.83 4 0.68 3 # weeks 302 2 1 0 Q1 Q2 Q3 310 32
Slide 39: Data Analytics - taking productivity to the next level
Data Analytics - taking productivity to the next level For personal use only Predicting Rail Maintenance Specialist, multi-disciplined team formed including data scientists RTIO Leverages data collected from AutoHaulTM and other technology throughout the rail network Using artificial intelligence an
Slide 40: Sustain low cost through productivity and technology
Sustain low cost through productivity and technology For personal use only Pilbara cash unit cost 2020 Cost Direction: Labour costs and Market tightening for some skill segments 20.2 maintenance Increased maintenance hours 19.5 Increase of ~12% due to longer haul distances 14-15 Mine work index $ pe
Slide 41: Long-term asset with strong replacement pipeline
Long-term asset with strong replacement pipeline For personal use only Low-cost, value-accretive capital options Multiple mine replacement options leveraging established hubs Capital intensity $ / t installed capacity 110 80 Koodaideri 50 Mesa B, C, H West Angelas C, D 20 -10 2019 Approved Project U
Slide 42: System Outlook and Guidance
System Outlook and Guidance For personal use only System Outlook System demonstrating 360 Mtpa run-rate short term 360 Mtpa capacity achieved when Koodaideri Phase One is fully commissioned1 2019 Guidance Shipments: 320 - 330 Mt (100% basis) Unit costs: $14 - 15 /t 2020 Guidance Up to 5% increase on
Slide 43: Strategy to deliver returns through the cycle
Strategy to deliver returns through the cycle For personal use only Continued outstanding financial performance through superior EBITDA margin Mines - operational improvements delivering results Focus on delivering sustainable operational excellence Productivity and technology to offset headwinds Re
Slide 44: Stephen McIntosh: At the frontier of mining technology
For personal use only Stephen McIntosh At the frontier of mining technology
Slide 45: Technology at our core
Technology at our core For personal use only Sustaining our leading Deploying emerging World class talent cost positions technologies Delivering real Proven track record Tackling critical growth options in project study industry challenges through exploration and execution 45 ©2019, Rio Tinto, All R
Slide 46: Leading mining industry innovation
Leading mining industry innovation For personal use only R&D / Pilot Phase Deployment start date Deployment 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 Pilbara remote operations centre Automation Autonomous trucks MAS1 / RTVis2 TM Autonomous drills AutoHaulTM Process Tech Tailings Press Filter
Slide 47: Beyond automation
Beyond automation For personal use only Value chain integration Digitally enabled operations Open Data TrueView Real-time operational insights Environment* Mine Automation System Frontline decision support Seamless integration with third party tech Precision in decision making Paperless Edison maint
Slide 48: Data analytics and AI lowers cost and drives productivity
Data analytics and AI lowers cost and drives productivity For personal use only Copper head grade prediction Reducing materials handling down time Forecasting ship arrivals Real-time chemistry increasing Cu recovery ~40% reduction in materials handling down time Enable the reduction of demurrage cos
Slide 49: Industry-leading exploration technology delivering results
Industry-leading exploration technology delivering results For personal use only Sophisticated proprietary tools & techniques “Greenrocks” Geochronology & Fertility Automated Mineralogy Predictive Analytics New models Rapid application of new technologies Winu FalConTM Drones Hyperspectral Imaging D
Slide 50: World-class execution function
World-class execution function Digital design and innovative construction led to multiple awards for Amrun For personal use only Winner: The Australian Construction Achievement Awards Winner: The Civil Contractors Federation national award Winner: IACCM innovation & excellence award Winner: ICE Brun
Slide 51: Making mining fleets more productive
Making mining fleets more productive For personal use only What is the mobile The benefits Status of work surge loader? An integrated, mobile hopper bin and loading chute 50% First of its kind being built by supplier MMD (commissioning Oct 2019) increase in productivity of digger* expected as a resu
Slide 52: Optimising orebodies and adding new revenue streams
Optimising orebodies and adding new revenue streams For personal use only Recovering borates from our tailings Potential to add a new lithium revenue stream Lowest cost refinery ore feed, including recovery of tailings Optimising methods to generate battery-grade lithium carbonate from waste streams
Slide 53: Using technology to tackle critical industry challenges
Using technology to tackle critical industry challenges For personal use only Tailings – Dry-stacking: Water management: Work with industry to research and develop new tailings solutions Increase capability to enhance water use and reduce waste Source: Epiroc Solar: Wind: Hybrid & electric equipment
Slide 54: Leading the next frontier in mining
Leading the next frontier in mining For personal use only Unlocking tonnes Fighting inflation Creating options Reducing capital Tackling critical intensity industry challenges 54 ©2019, Rio Tinto, All Rights Reserved
Slide 55: Oyu Tolgoi
For personal use only Arnaud Soirat and Stephen McIntosh Oyu Tolgoi
Slide 56: Oyu Tolgoi, a key investment for Rio Tinto
Oyu Tolgoi, a key investment for Rio Tinto For personal use only World-class ore body, set to become one of the world’s largest copper/gold mines Outstanding achievements in safety and production Open pit operations and mine plans continue to be optimised, delivering over $1bn free cash flow since 2
Slide 57: Operating in an evolving landscape
Operating in an evolving landscape only Population Sovereign Risk Economy use Complexities Largely dependent Increased urbanisation Political uncertainty personal on Oyu Tolgoi Opportunities Young, educated Mongolia can demonstrate Diversify base – For population; employment successful delivery of l
Slide 58: Construction progress
Construction progress For personal use only Shaft 2 construction complete Boosted productivity Updating mine design Hoist systems being commissioned Record month in September 2019 Building an asset that will live 50 years + Game changer for underground development Lateral development progress of 1,3
Slide 59: Shaft construction complete
Shaft 2 construction complete For personal use only Animation shows infrastructure that has been completed (Shaft 2, Conveyor to surface) as well as elements currently under construction (Primary Crusher 1). 59 ©2019, Rio Tinto, All Rights Reserved
Slide 60: Construction progress
Construction progress For personal use only Shaft 2 construction complete Boosted productivity Updating mine design Hoist systems being commissioned Record month in September 2019 Building an asset that will live 50 years + Game changer for underground development Lateral development progress of 1,3
Slide 61: Looking forward
Looking forward For personal use only Shaft 2 construction complete – going through commissioning phase Now focusing on key underground supporting infrastructure: - Primary crusher 1 - Conveyor to surface - Shafts 3 and 4 Complete the mine design in H1 2020 Complete Definitive Estimate in H2 2020 61
Slide 62: Jakob Stausholm: Our investment proposition
For personal use only Jakob Stausholm Our investment proposition
Slide 63: Why invest in Rio Tinto?
“Why invest in Rio Tinto?” For personal use only Our Assets Our Approach Our Performance Long life Sustainability (ESG) Last 3 Years1 ROCE2 Competitive Operational Excellence $25 billion earnings3 18% Expandable + Value over volume = $23 billion free cash flow 17% Sustainable Capital discipline $26
Slide 64: Why invest in Rio Tinto?
“Why invest in Rio Tinto?” For personal use only Our Assets Our Approach Our Performance Long life Sustainability (ESG) Last 3 Years1 ROCE2 Competitive Operational Excellence $25 billion earnings3 18% Expandable + Value over volume = $23 billion free cash flow 17% Sustainable Capital discipline $26
Slide 65: Long life: large resource base and modest depletion
Long life: large resource base and modest depletion For personal use only 40% 60% of assets in processing > of assets in mining > no depletion modest depletion Very significant Bulk products Mineral resources in addition 2018 Production1 Ore Reserves2 Resources2 to reserves Mt Mt Mt Pilbara Iron Ore
Slide 66: Outstanding competitive position: >80% of assets in lower half of cost curve
Outstanding competitive position: > 80% of our assets1 in lower half of the cost curve For personal use only 2019 Iron ore value in use curve (CFR China, US$/dmt) 90 Pilbara Iron Ore Lower half of the cost curve 60 Borates 30 In well-structured markets TiO2 0 With a strong market position 0% 14% 28%
Slide 67: Expandable: technical knowledge and asset base create opportunities
Expandable: our technical knowledge combined with our asset base creates opportunities throughout the pipeline For personal use only Spend over the last 3 years1 in $ billion Spending Trend: 0.7 0.7 7.3 6.7 Greenfield Exploration Product Groups Development Sustaining & Evaluation Exploration & Evalu
Slide 68: Sustainable: assets well placed in a carbon-constrained world
Sustainable: assets are well placed in a carbon-constrained world For personal use only No extraction of fossil fuels Total own greenhouse gas emissions 71% of electricity from renewable 34 sources 32 Own emissions down 18% in the 32 last five years -18% 31 Renew own emission targets in Q1 2020 28 W
Slide 69: Our strong balance sheet creates resilience and optionality
Our strong balance sheet creates resilience and optionality For personal use only Reduces cyclicality of cash flows Net debt $ billion 15 14.1 Enables counter-cyclical behaviour 13 12.9 11.3 Creates optionality 11 10.0 9.3 9.3 9 8.0 9.6 7 5.6 7.6 5.2 5 3.8 4.9 3 1 -0.3 -1 Jun-16 Dec-16 Jun-17 Dec-17
Slide 70: Why invest in Rio Tinto?
“Why invest in Rio Tinto?” For personal use only Our Assets Our Approach Our Performance Long life Sustainability (ESG) Last 3 Years1 ROCE2 Competitive Operational Excellence $25 billion earnings3 18% Expandable + Value over volume = $23 billion free cash flow 17% Sustainable Capital discipline $26
Slide 71: Well-established sustainability (ESG) approach
Well-established sustainability (ESG) approach For personal use only Relationships and governance Effective risk management Closure, the long-term view Safety always our first priority Community relations Transparency: - Climate change report - Taxes paid - Contract disclosure - Tailings disclosure
Slide 72: Operational excellence: productivity is a key lever
Operational excellence: productivity is a key lever For personal use only Mine to Market M2M1 free cash flow target of $ billion 1.0-1.5 $1.0-1.5 billion run-rate from 2021, dependent on: Market conditions in Iron Ore Raw material prices in Aluminium reverting to levels at the beginning of the progr
Slide 73: Value over volume
Value over volume For personal use only Value over volume Day-to-day commercial considerations by commodity Production growth (Cu Eq) Investment decisions entirely driven by value Last 3 years 2016 2019 2023 1 Compound Annual Growth Rate (CAGR) from 2H2016 to 1H2019 73 ©2019, Rio Tinto, All Rights R
Slide 74: Disciplined allocation of capital
Disciplined allocation of capital For personal use only Essential 1 sustaining capex Further cash returns to Compelling Ordinary 2 dividends shareholders growth Iterative 3 cycle of Debt management 74 ©2019, Rio Tinto, All Rights Reserved
Slide 75: Controlled ramp-up of investments
Controlled ramp-up of investments For personal use only Sustaining capex of around Capital expenditure profile $2.5 billion per year $ billion ~7.0 Iron Ore sustaining capex of ~6.5 ~6.5 $1.0-1.5 billion per year ~5.5 5.4 Pilbara replacement capital Depreciation includes Koodaideri and Robe River 4.
Slide 76: Counter-cyclical: divested assets while disciplined on capital spend
Counter-cyclical: divested assets while disciplined on capital spend For personal use only Divested assets in strong Cash proceeds from divestments commodity markets (pre-tax) 8.6 12.3 $ billion 18 assets divested since 2016 Raised $12.3 billion in pre-tax cash flow All post-tax divestment proceeds
Slide 77: Why invest in Rio Tinto?
“Why invest in Rio Tinto?” For personal use only Our Assets Our Approach Our Performance Long life Sustainability (ESG) Last 3 Years1 ROCE2 Competitive Operational Excellence $25 billion earnings3 18% Expandable + Value over volume = $23 billion free cash flow 17% Sustainable Capital discipline $26
Slide 78: Our performance: industry-leading profitability…
Our performance: industry-leading profitability… For personal use only Average ROCE 2009 to 2019 of 16% Return on invested capital*, post tax Average ROCE 2001 to 2008 of 22% Only one year of single digit ROCE in two decades 23% 24% 22% 18% 15% 17% 15% 12% 13% 10% 8% 2009 2010 2011 2012 2013 2014 20
Slide 79: …that drive strong cash flows…
…that drive strong cash flows… For personal use only Cash flow in $ billion Capital allocation framework in action 20.0 18.3 15.1 New returns 15 13.7 14.3 13.9 policy 11.8 9.4 9.4 9.5 10 9.2 8.5 7.7 7 6.9 5.8 4.8 3.9 2.1 Free cashflow at spot prices and consensus volumes (8.1) 2009 2010 2011 2012 20
Slide 80: …based on a well defined pay-out policy
…based on a well defined pay-out policy For personal use only Our pay-out ratio has consistently exceeded the policy Returns policy widely accepted 160% 140% Pay-out ratio policy de-risks the company 120% 100% 80% 60% Policy of 40-60% of underlying earnings through the cycle 40% 20% 0% 2016 2017 201
Slide 81: Why invest in Rio Tinto?
“Why invest in Rio Tinto?” For personal use only Our Assets Our Approach Our Performance Long life Sustainability (ESG) Last 3 Years1 ROCE2 Competitive Operational Excellence $25 billion earnings3 18% Expandable + Value over volume = $23 billion free cash flow 17% Sustainable Capital discipline $26
Slide 82: J-S Jacques, Chief executive
For personal use only J-S Jacques Chief executive
Slide 83: Appendices October 2019
For personal use only Appendices 31 October 2019 London
Slide 84: World-class iron ore assets - fully integrated and agile network
World-class iron ore assets - fully integrated and agile network For personal use only CAPE LAMBERT A & B HAMERSLEY IRON (100%) PARKER POINT Dampier Point Samson UNDEVELOPED PROJECT (100%) 16 > 150 Wickham EAST INTERCOURSE ISLAND Karratha Roebourne ROBE RIVER MINING JV (53%) Mines Autonomous haul tr
Slide 85: Benefits to Mongolia already significant
Benefits to Mongolia already significant and will continue for generations For personal use only World-class $9.5bn Direct economic safety performance spent to date in Mongolia contribution 88% $2.4bn International water recycling rate in taxes and royalties reputation 212,000 15,000 93% Industry sa
Slide 86: Construction progress at Oyu Tolgoi
Construction progress at Oyu Tolgoi For personal use only Above ground infrastructure Shafts & below ground Lateral development productivity completed infrastructure completed Mine dry building Load commissioning of Jaw Crusher Lateral mine footprint development Mine dry and control centre Shaft 2 c
Slide 87: Investment agreements allowed financing for Oyu Tolgoi
Investment agreements allowed financing for Oyu Tolgoi For personal use only Underground UDP signed and Underground construction Open pit mine constructed and production commenced construction project finance recommenced & ongoing suspended secured 2009 2011 2013 2015 2016 2018 TODAY Investment Agre
Slide 88: Group level financial guidance
Group level financial guidance For personal use only FY2019 FY2020 FY2021 FY2022 CAPEX Total Group $5.5bn ~$7.0bn ~$6.5bn ~$6.5bn Sustaining Capex ~$2.5bn ~$2.5bn ~$2.5bn ~$2.5bn Group Pilbara Sustaining $1.0bn $1.0-$1.5bn $1.0-$1.5bn $1.0-$1.5bn Capex Productivity $0.5bn $1.0 - $1.5bn1 Effective ta
Slide 89: Group level financial guidance
Group level financial guidance For personal use only 2019 production guidance1 2019 costs 2020 guidance Iron Ore Shipments 320 – 330mt (100% basis) $14-15/wmt (FOB)2 Up to 5% increase on shipments from 2019 guidance, subject to market conditions. C&D C1 unit costs 110-120 c/llb Mined Copper 550 – 60
Slide 90: Modelling EBITDA
Modelling EBITDA For personal use only Underlying EBITDA sensitivity ($m) impact on FY 2019 underlying EBITDA H1 2019 average price / rate of 10% price/rate change Copper 280c/lb 281 Aluminium $1,826/t 462 Gold $1,307/oz 61 Iron ore (62% Fe FOB) $84.9/dmt 1,862 A$ 0.71US$ 550 C$ 0.75US$ 345 Oil (Bre
Slide 91: Modelling aluminium costs
Modelling aluminium costs For personal use only ($/t) Impact a $100/t change in each of the input costs below will Canadian* smelting unit cash** cost sensitivity have on our H1 2019 Canadian smelting unit cash cost of $1,406/t Alumina (FOB) 191 Green petroleum coke (FOB) 34 Calcined petroleum coke
Slide 92: Group Income Statement
Group Income Statement For personal use only Rio Tinto Group Oyu Tolgoi and Turquoise Hill(1) Proforma Rio Tinto Group (excluding OT and TRQ)(2) Jun-19 Dec-18 Jun-19 Dec-18 Jun-19 Dec-18 YTD YTD YTD YTD YTD YTD Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Consolidated sale
Slide 93: Group Balance Sheet
Group Balance Sheet For personal use only Rio Tinto Group Oyu Tolgoi and Turquoise Hill(1) Proforma Rio Tinto Group (excluding OT and TRQ) Jun-19 Dec-18 Jun-19 Dec-18 Jun-19 Dec-18 YTD YTD YTD YTD YTD YTD Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Non-current assets 69,8
Slide 94: Group Cash Flow Statement
Group Cash Flow Statement For personal use only Rio Tinto Group Oyu Tolgoi and Turquoise Hill(1) Proforma Rio Tinto Group (excluding OT and TRQ)(2) Jun-19 Dec-18 Jun-19 Dec-18 Jun-19 Dec-18 YTD YTD YTD YTD YTD YTD Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Actual ($m) Cash flows fro