Rio Tinto Alcan confirmed as third major pillar of Rio Tinto Group
· Pro forma 2007 underlying EBITDA of $4,813 million for Primary Metal and Bauxite & Alumina, making Rio Tinto Alcan the third major pillar of Group EBITDA along with iron ore and copper.
· Pro forma 2007 underlying earnings for Primary Metal and Bauxite & Alumina of $2,092 million, representing 23 per cent of Rio Tinto’s pro forma underlying earnings before corporate items and interest.
· Pro forma capital expenditure for Primary Metal and Bauxite & Alumina of $2,296 million in 2007, reflecting continuing investment in value adding growth projects.
· Pro forma share of production of 4.2 million tonnes of aluminium, 8.5 million tonnes of alumina and 32.0 million tonnes of bauxite in 2007.
· Significant earnings momentum anticipated in 2008 with each 10 c/lb movement in the average annual aluminium price from the 2007 level of 120c/lb expected to change Rio Tinto Alcan’s underlying earnings by $620 million. 2008 underlying earnings are also expected to be affected by exchange rate movements with a 10 US cent movement in the Canadian dollar rate expected to impact full year underlying earnings by $150 million. Rising energy, pitch, coke, oil and freight costs are also expected to partly offset any gain from higher LME prices
· Bauxite reserves totalling 1,387 million tonnes of recoverable mineral (Rio Tinto share) at the end of 2007 compared with 1,193 million tonnes at the end of 2006. The 2007 numbers incorporate the Rio Tinto assets and Alcan assets combined under the Rio Tinto Alcan name for the first time. Detailed bauxite reserves and resources data have been included within this release on pages 5 and 6.
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About Rio Tinto
Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and NYSE listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.
Rio Tinto’s business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, energy (coal and uranium), gold, industrial minerals (borax, titanium dioxide, salt, talc) and iron ore. Activities span the world but are strongly represented in Australia and North America with significant businesses in South America, Asia, Europe and southern Africa.
Pro forma Financial Information
Pro forma financial information included in this announcement has not been audited and has not been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission. Such pro forma information has been prepared on the basis of IFRS. Actual financial results may have differed from those reported herein.
Forward-Looking Statements
This announcement includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this announcement, including, without limitation, those regarding Rio Tinto’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to Rio Tinto’s products, production forecasts and reserve and resource positions), are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Rio Tinto, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Such forward-looking statements are based on numerous assumptions regarding Rio Tinto’s present and future business strategies and the environment in which Rio Tinto will operate in the future. Among the important factors that could cause Rio Tinto’s actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, levels of actual production during any period, levels of demand and market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange rates on market prices and operating costs, operational problems, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as changes in taxation or regulation and such other risk factors identified in Rio Tinto’s most recent Annual Report on Form 20-F filed with the United States Securities and Exchange Commission (the “SEC”) or Form 6-Ks furnished to the SEC. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements. These forward-looking statements speak only as of the date of this announcement. Rio Tinto expressly disclaims any obligation or undertaking (except as required by applicable law, the City Code on Takeovers and Mergers (the “Takeover Code”), the UK Listing Rules, the Disclosure and Transparency Rules of the Financial Services Authority and the Listing Rules of the Australian Securities Exchange) to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in Rio Tinto’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
Nothing in this announcement should be interpreted to mean that future earnings per share of Rio Tinto plc or Rio Tinto Limited will necessarily match or exceed its historical published earnings per share.
Subject to the requirements of the Takeover Code, none of Rio Tinto, any of its officers or any person named in this announcement with their consent or any person involved in the preparation of this announcement makes any representation or warranty (either express or implied) or gives any assurance that the implied values, anticipated results, performance or achievements expressed or implied in forward-looking statements contained in this announcement will be achieved.
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