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Rio Tinto's net profit plunged 22% in the first half of 2025
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Release time：2025-08-01
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Underlying EBITDA decreased to $11.55 billion (£8.74 billion) from $12.09 billion, while operating net cash flow decreased by 1.9% to $6.92 billion.
Rio Tinto's earnings for the first half of 2025 (H1 2025) declined due to lower commodity prices, increased capital expenditure, and tariffs. The mining giant's net profit plummeted 22% to $4.53 billion in the first half of 2025, down from $5.81 billion in the first half of 2024. Earnings before interest, taxes, depreciation, and amortization (EBITDA) fell from $12.09 billion to $11.55 billion, while net cash from operating activities decreased by 1.9% to $6.92 billion.
Free cash flow plunged 31% to $1.96 billion due to increased investment, with capital expenditure rising from $4.02 billion to $4.73 billion. Net debt soared to $14.6 billion in the first half of 2025, almost triple the $5.08 billion reported the previous year. Tariff costs reached $321 million, further exacerbated by the US raising tariffs on Canadian aluminum from 25% to 50%.
However, Rio Tinto maintained its forecasts for various commodities in 2025. Pilbara iron ore shipments are expected to be at the lower end of guidance due to the impact of cyclones. Alumina production is expected to be at a higher level, driven by strong performance from Amrun. Copper production from Oyu Tolgoi and Escondida will be at higher levels, while titanium slag production will be lower due to market demand. Given growing demand, the company prioritizes copper and lithium. Capital investment guidance for 2025 remains at $11 billion, including the Arcadium lithium project. The effective tax rate is expected to rise from 30% in 2025 to 33%, returning to 30% in 2026. Exploration and evaluation expenses are expected to be "slightly below" the 2025 guidance of $1 billion. Rio Tinto's CEO, Jakob Stausholm, stated: “Our strong cash flow allows us to maintain our mid-term dividend payout of 50% and a $2.4 billion ordinary dividend, while we continue to invest rigorously in profitable growth, maintaining a strong balance sheet. We are exceptionally well-positioned to create value through best-in-class project execution and the growing demand for our products now and for decades to come. With a solid foundation and a future-oriented diversified portfolio, we remain on track for strong mid-term production growth.”
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