LONDON -- The shares of Rio Tinto rallied 2% during early London trade after the miner lifted its annual dividend by 18%, though the shares have since slipped along with the broader market.
Rio declared a total payout of 106.77 pence per share for 2012 compared to 90.47 pence per share for 2011. The dividend lift accompanied full-year results that showed revenue falling $10 billion to $50 billion and underlying earnings declining $6 billion to $9 billion. Rio blamed the lack of progress on lower metal prices, which the firm said wiped $5 billion from its bottom line.
Rio's figures were also blighted by write-offs totaling $14 billion, which were revealed last month and triggered the appointment of a new chief executive. Sam Walsh, Rio's newly installed boss, said this morning:
Today I am setting out how we can build on our strengths and improve this great company. Under my leadership, Rio Tinto will have an unrelenting focus on pursuing greater value for shareholders. To do this we need to run the business as owners not managers and my immediate priority is to build more focus, discipline and accountability throughout the organization.
Walsh added that he was "targeting significant cash proceeds from divestments from non-core businesses in 2013" and "cumulative cash cost savings of more than $5 billion over the next two years."
Based on today's figures, Rio's shares trade on a P/E of 12 and yield 2.8%.
Of course, whether those ratings, today's statement, and the general outlook for miners and commodities all combine to make Rio a buy remains your decision. However, if you already own Rio shares and are looking to diversify, this free special report covers a tip-top growth opportunity with operations far removed from the mining sector.
Indeed, the blue chip in question has lifted its earnings per share by 44% since 2009, owns subsidiaries that might carry considerable hidden value, and has just been declared "The Motley Fool's Top Growth Stock For 2013." Just click here to download the report -- it's free.
The article Rio Tinto Raises Dividend by 18% originally appeared on Fool.com.
Maynard does not own any share mentioned in this article. The Motley Fool has a disclosure policy.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.