Rio Tinto flags as much as $10bn in asset sales under refreshed strategy
Commodities major Rio Tinto is opening the door to as much as $10-billion in divestments as part of a strategy reset aimed at sharpening its portfolio, lifting productivity and delivering “industry-leading” returns.
Discussing the plan at its Capital Markets Day on Thursday, CEO Simon Trott said the miner would become “stronger, sharper and simpler” by narrowing its focus to three product groups – iron-ore, copper and aluminium and lithium – and by driving stricter capital discipline across the business.
As part of the overhaul, Rio will explore commercial, partnership or ownership changes across a range of land, infrastructure, mining and processing assets, with the company saying it sees “opportunistic release of $5-billion to $10-billion” from its existing portfolio.
"We are really focusing our efforts on where we can move the needle, so we have obviously announced the strategic reviews of RTIT and Borax, and that’s included in the number," said Trott during the question and answer session of the Capital Markets Day.
Strategic reviews of the Iron and Titanium and Borates units are advancing, with market testing to follow.
“We also have a really significant footprint right around the world – infrastructure, land, and obviously the mining and processing assets.
“Peter [Cunningham] gave an example earlier… around $500-million. It is an infrastructure asset we need access to but we don’t need to own on our own balance sheet. That will comprise a component of it.”
“As always, we’ll continue to look at our capital base and make sure we’re the right owner of all of those assets.”
Trott said the refreshed strategy would “unlock the full potential” of Rio’s diversified portfolio while maintaining balance-sheet strength. “Freeing up cash from our asset base where it makes sense will strengthen the balance sheet and maintain returns, as we invest for the future with discipline,” he said.
Rio is targeting an immediate uplift in performance, including $650-million in annualised productivity gains in the first three months of the new structure, with further benefits expected from organisational simplification and tighter operating discipline.
The miner expects 7% production growth in 2025 and a 3% compound annual growth rate to 2030, supported by the ramp-up of Oyu Tolgoi, in Mongolia, Simandou, in Guinea, and lithium projects including Arcadium and Rincon. Consensus price assumptions imply earnings before interest, tax, depreciation and amortisation could rise 40% to 50% by 2030, underpinned by 20% copper-equivalent output growth.
Rio also trimmed its mid-term decarbonisation capital estimate to $1-billion to $2-billion to 2030, down sharply from the previous $5-billion to $6-billion, citing increased use of third-party renewable investment.
GUIDANCE UPDATES
Rio upgraded its 2025 copper guidance to between 860 000 t and 875 000 t (from 780 000 t to 850 000 t) and cut unit-cost guidance to 80 c/lb to 100 c/lb. Bauxite output is now expected to exceed the previous 59-million to 61-million-tonne range, while aluminium should land at the top end of 3.25-million to 3.45-million tonnes.
IOC production has been revised down to 9.0-million to 9.5-million tonnes. For 2026, Rio sees Simandou contributing 5-million to 10-million tonnes of iron-ore sales as the giant Guinea project starts up.
Group capital expenditure will be about $11-billion in both 2025 and 2026, before easing to below $10-billion a year in the later 2020s as major developments are completed.
