The shares of Rio Tinto (LSE: RIO) (NYSE: RIO.US) added 46p to 3,300p during early trade this morning after the miner announced record iron ore production.
The FTSE 100 member confirmed iron ore production during October, November and December had advanced 6% to 70.4 million tonnes to support production for 2013 as a whole to climb 5% to 266 million tonnes.
Rio added that iron ore production remained on target to reach a rate of 290 million tonnes a year by June.
Today’s statement also revealed copper production had improved by 15% to 172,800 tonnes and bauxite production had improved by 10% to 11.4 million tonnes.
The blue chip added that more than $2bn of operating cash cost improvements were achieved during 2013 compared with 2012, and confirmed exploration and evaluation expenditure was reduced from $2bn to $1bn last year.
Sam Walsh, Rio’s chief executive, said:
“We have set new records for iron ore production and shipments as we ramp up our 290 expansion, as well as achieving an impressive recovery in copper volumes and record annual production for both bauxite and thermal coal.“
“We have exceeded our cost cutting targets for the year and announced or completed $3.5 billion of non-core asset sales. These actions, together with lower capital expenditure in 2013 and beyond, will ensure that Rio Tinto is well positioned to deliver greater value to shareholders.“
Prior to today, City experts were expecting Rio’s upcoming annual results to show earnings equivalent to 326p per share and a dividend equivalent to 110p per share.
Following this morning’s price movement, the shares may therefore trade on a P/E of 10 and offer a possible income of 3.3%.
> Maynard does not own any share mentioned in this article.