Rio Tinto Net Soars 194%; Telstra Net Drops 36%

Marcus Jacob
10 Feb, 2011
New York City

Stocks in Australia were firm ahead of Rio Tinto earnings. After the close iron ore miner said annual net soared to $14.32 billion and increased full year dividend 20%. Transurban underlying earnings increased 9.5% to $362.8 million. Telstra net dropped 36%.

[R]5:00 Sydney – Stocks in Australia were firm ahead of Rio Tinto earnings. After the close iron ore miner said annual net soared to $14.32 billion and increased full year dividend 20%. Transurban underlying earnings increased 9.5% to $362.8 million. Telstra net dropped 36%.[/R]

Stocks in Sydney traded higher ahead of earnings from Rio Tinto and higher commodities prices in international markets.

The ASX 200 index rose 9.6 to 4,914.40 and the broader All Ordinaries index added 6.6 to 5,001.70. The broader index last crossed above 5000 on April 16, 2010.

Rio Tinto said it extended its offer period to acquire Riversdale Mining by another fourteen days to March 4.

Net earnings for the year ending in December soared 194% to US$14.32 billion from US$4.87 billion a year ago. The global miner also increased full year dividend 20% to US$1.08 per share of which final dividend is 63 U.S. cents.

The company also announced the US$5 billion stock buyback program and also said it lowered its debt to US$4.3 billion at the end of the year from US$18.9 billion.

The strong operations and profits were driven by a sharp increase in production and prices in iron ore operations. Iron Ore group generated net profit of US$10.2 billion, 147% higher than a year ago and Pilbara region mines production soared to 224 million tons.

Stock Movers

ASX Ltd soared 4.7% or $1.71 to $38.41 after London Stock Exchange and Toronto based TMX Group agreed to merge and exchanges of New York and Frankfurt are in merger talks.

Telstra declined 1 cent to $2.88 after the telecom operator said first half net declined 35.6% to $1.16 billion from $1.85 billion and affirmed its outlook. Sales declined 0.5% to $12.28 billion.

Telstra chief David Thodey also said that the company has agreed “key commercial terms” with broad band infrastructure project NBN Co. that will deliver after tax of $9 billion in present vale.

Telstra also confirmed interim dividend same as last year of 14 cents per share.

SingTel declined 1 cent to $2.37. Optus, second largest mobile operator said third quarter net rose 2% and its parent SingTel net also increased in the third quarter.

Rio Tinto increased 30 cents to close at $88.68 and BHP Billiton rose 2 cents to $46.76. Riversdale increased 10 cents to $15.95 and Fortescue Metals closed unchanged at $6.70.

Alumina declined 3 cents to $2.46 after it reported full year annual net of $35 million and made positive comments.

Commonwealth Bank increased 53 cents to close $55.58 and National Australia Bank declined 5 cents to $25.94. Westpac increased 14 cents to $24.24 and ANZ increased 18 cents to close at $25.10.

Transurban, toll-road operator declined 9 cent to $5.20 after it reported first half net increased 40.3%. The toll road operator also confirmed half year dividend of 13 cents payable on February 15 and for the full year of at least 26 cents.