Rio Tinto Group stock forecast 2013

Rio Tinto Group stock forecast 2013 : Rio Tinto Group (RIO), the world’s third- largest mining company, said first-half profit dropped 22 percent after prices for iron ore, copper and aluminum fell and costs at its operations gained.

Net income declined to $5.9 billion from $7.6 billion a year earlier, London-based Rio said today in a statement. That compares with the $5.04 billion average of 11 analyst estimates compiled by Bloomberg. Net income was boosted by a $1 billion so-called deferred tax benefit after Australia introduced its Mineral Resource Rent Tax on July 1.

esult was slightly better than expected; however, it has not bucked the trend of diversified miners showing lower year-on-year earnings, continues to generate large profits on its high-margin iron ore business and through further growth in both iron ore and copper, profits from Rio Tinto are forecast to grow significantly in 2013.

Rio Tinto, the biggest ore-exporter behind Rio de Janeiro- based Vale SA (VALE), advanced 2.9 percent to 3,220 pence by the close of trading in London, the highest since May 3.The company increased its interim dividend 34 percent to 72.5 cents a share, even as underlying profit slumped by 34 percent to $5.2 billion.

Rio is expanding iron ore operations, including a $4.2 billion spending plan approved in June, even as prices drop. An expansion at its Pilbara business in Western Australia to increase capacity to 283 million tons a year is on schedule to be completed by the end of 2013, Rio said today.

Rio today maintained its estimate for 2012 spending of $16 billion to expand mines and build new operations. That includes a project to boost annual iron-ore output in Australia’s Pilbara region to 353 million tons by mid-2015 from current capacity of 230 million tons.

Spending in 2013 may be lower and the company will ‘‘pause for breath’’ on any further expansion in the Pilbara beyond 353 million tons, Albanese said on a conference all today.

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