Rio Tinto plc Sponsored ADR (RIO.US) announced its full-year performance: profits are flat, slightly below expectations. Iron ore is under pressure, but the copper business is performing strongly.

Global mining giant Rio Tinto plc Sponsored ADR (RIO.US) announced its 2025 performance on Thursday. The data shows that despite the drag on its core iron ore business due to weak prices, supported by strong performance in its copper business, the company's full-year underlying profit remained flat, slightly below market expectations. According to the financial report released by Rio Tinto plc Sponsored ADR, the company recorded an underlying profit of $10.87 billion for the year ended December 31, 2025. This figure is flat compared to the previous year but slightly below market expectations of $11.03 billion. The company also announced a final dividend of 254 cents per share, equivalent to returning 60% of underlying profits to shareholders, higher than the 225 cents in 2024. The report shows that the company's largest source of profit, the iron ore business, was dragged down by falling prices and flat shipments, leading to an 11% decrease in earnings before interest, taxes, depreciation, and amortization (EBITDA) year-on-year. Additionally, the company faced challenges in its iron ore operations in the Pilbara region of Western Australia, with annual unit costs rising by approximately $0.5 per ton compared to 2024 due to inflation pressures and weather-related disruptions. Rio Tinto plc Sponsored ADR expects unit costs for Pilbara iron ore to further increase to between $23.5 and $25.0 per wet ton this year. In contrast to the iron ore business, Rio Tinto plc Sponsored ADR's copper business performed well. Thanks to continued production growth at the Oyu Tolgoi mine in Mongolia, copper production in 2025 increased by 11% year-on-year, with an average realized price also rising by 17%, leading to a doubling of the business's underlying EBITDA to $7.37 billion. The company's aluminum and lithium businesses also achieved a 29% increase in profits due to improved prices, but this included approximately $1 billion in total costs related to U.S. aluminum export tariffs. Rio Tinto plc Sponsored ADR's performance also reflects a strategic shift in the global mining industry. With the increasing demand for electricity from artificial intelligence data centers and the accelerated transformation of Clean Energy Fuels Corp. globally, the strategic importance of metals such as copper is becoming more prominent. This week, Rio Tinto plc Sponsored ADR's competitor BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs (BHP.US) also announced its performance, with profits from its copper business surpassing iron ore for the first time, driving an acquisition frenzy within the industry as major companies seek to acquire long-life copper resources. Simon Trott, CEO of Rio Tinto plc Sponsored ADR, also stated in the performance release that the company is focusing on streamlining its business processes, with $600 million in one-time restructuring costs recorded, and expects related benefits to be realized in 2026. Two weeks prior to the performance announcement, Rio Tinto plc Sponsored ADR had just announced the termination of merger talks worth $24 billion with another mining giant, Glencore (GLNCY.US). Trott responded by stating that while constructive discussions had taken place, the parties ultimately found it impossible to build a convincing valuation proposal. He emphasized that while acquisitions have always been part of the company's business development, they are not essential. In terms of its business related to China, Trott revealed that Rio Tinto plc Sponsored ADR is still in negotiations with China Minmetals, a state-supported entity for iron ore procurement. He stated that the company believes in market liquidity, prices determined by fundamentals, and will continue to engage with China Minmetals Group and other market participants.