Rio Tinto Plc · LSE:RIO
Rio Tinto — Bernstein Strategic Decisions Conference 2020
10 slides from Rio Tinto's conference presentation, Sep 23, 2020
Slide 1: Bernstein Strategic Decisions conference
Bernstein Strategic Decisions conference Jakob Stausholm, CFO 23 September 2020
Slide 2: Cautionary and supporting statements
Cautionary and supporting statements This presentation has been prepared by Rio Tinto plc and Rio Tinto Limited (together with their subsidiaries, “ Rio Tinto”). By accessing/attending this presentation you acknowledge that you have read and understood the following statement. Forward-looking statem
Slide 3: Improved conditions but wide range of potential outcomes ahead
Improved conditions but wide range of potential outcomes ahead High frequency data: a V-shaped recovery in China Current state of play Index: % 400 Start year = 100 90 – China: industrial sector growth now above pre- Covid-19 levels and plateauing 300 80 – Europe and US: rebound in economic activity
Slide 4: A resilient performance in H1 2020
A resilient performance in H1 2020 $9.6 billion $3.8 billion Underlying EBITDA Paid to shareholders2 47% & 21% $2.7 billion Underlying EBITDA margin & ROCE1 Corporate taxes paid $2.8 billion $1.2 billion Free cash flow Royalties3 $4.8 billion $2.7 billion Net debt Capital invested 1 Return on Capita
Slide 5: Disciplined allocation of capital
Disciplined allocation of capital Essential 1 sustaining capex Further cash returns to Compelling Ordinary 2 dividends shareholders growth Iterative 3 cycle of Debt management 5 ©2020, Rio Tinto, All Rights Reserved
Slide 6: Continue to invest $20bn over three years
Continue to invest $20bn over three years Capital expenditure profile Controlled ramp-up of investments $ billion continues. ~7.0 ~7.0 H1 2020 capex of $2.7 billion Depreciation ~6.0 - Sustaining capex of $1.2 billion 5.4 5.5 - Development and replacement 4.5 capex of $1.5 billion Capital portion of
Slide 7: Maintained our balance sheet strength
Maintained our balance sheet strength Net debt Balance sheet strength is an asset. $ billion Offers resilience and creates optionality 14.1 Gearing 10% and net debt to LTM^ EBITDA of 0.23 12.9 11.3 10.0 Operating cash flow of $5.6 billion 9.3 9.3 following $1 billion of taxes paid in June 8.0 2020 r
Slide 8: Shareholder returns based on a well defined pay-out policy
Shareholder returns based on a well defined pay-out policy Shareholder returns of 40-60% of underlying earnings on average $2.5 billion ordinary interim dividend, through the cycle $1.55 per share, up 3% year-on-year 53% pay-out ratio 160% 140% Primary decision taken by Board for final dividend 120%
Slide 9: Our climate targets
Our climate targets 46% reduction in absolute emissions from managed $1 billion operations since 2008 estimated spend on (18% excl. divestments) 30% climate-related projects reduction in over five years Scope 1 and 2 emissions intensity by 15% Net zero ELYSISTM 2030 reduction in ambition for our Dev
Slide 10: Our investment case in action
Our investment case in action Our assets Our approach Our performance in H1 2020 Long life Sustainability (ESG) $4.8 billion underlying earnings Competitive Operational Excellence $2.7 billion of profit taxes paid Expandable + Value over volume = $1.2 billion royalty expenses1 Sustainable Capital di
Rio Tinto — Bernstein Strategic Decisions Conference 2020 on 6ix