Rio Tinto (RIO), which takes its name from an ancient mine in Andalusia, began life in the 1870s and is now ramping up spending to make it to the 2070s. That means building new mines. Investors have shied away from major capital investments in the past, maybe because Rio has managed to throw away so much of their cash. But it has turned a corner and is now spending wisely.
These growth plans, as well as a fall in iron prices, mean a leaner time for investor payouts after a bonanza few years. The interim dividend was cut by a third this year, and analysts see a downward slope for cash returns until 2026. Free cash flow is expected to fall until the same year, as per analyst consensus. The good news is the company is starting from an extremely high base: dividend payouts last year totalled almost £10bn.