Rio Tinto beat expectations

Rio Tinto’s results have just been released and underlying earnings were $US9.3 billion, a beat on market expectations.

The company is also planning a $US2 billion share buyback and will increase its dividend by 12% to $US2.15 per share.

Analysts were expecting underlying earnings of $USUS8.9 billion.

Here are the numbers:

The big miner has been cutting costs, increasing ore output, pulling back on capital spending and cutting debt.

A strengthening US dollar and cheaper oil prices helped bottom line.

Rio CEO Sam Walsh said: “Last year, we made a clear commitment to materially increase cash returns to our shareholders. We have delivered this today through a 12% increase in our full year dividend and a proposed $US2 billion share buy-back. These represent a total cash return to shareholders, in respect of 2014, of almost $US6 billion.”

Operating in a lower cost commodity environment — the price of iron ore fell by almost half throughout 2014 — Walsh said the company has continued to increase volumes and reduce costs. The miner has reduced its net debt level by $US5.6 billion to $US12.5 billion.

“With lower commodity prices and uncertain global economic trends, the operating environment remains tough,” Walsh said.

The company is expecting a further $US750 million in cash cost improvements and expects capital expenditure (capex, the amount of money a commodity company invest in developing new projects) will fall to less than $US7 billion before the year is out.

Capex is expected to remain flat at $US7 billion for the next few years.

NOW WATCH: This massive outdoor escalator in China is 10 stories high

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.