Rio Tinto (RIO) FY11 EPS Halved to $3.04 Due to Aluminum Write-Off; Revs Improve
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Rio Tinto Plc (NYSE: RIO) reports FY11 EPS of $3.04, versus $7.31 reported for the same period a year ago. Revenue for the quarter was $60.54 billion, compared to $55.17 billion in FY10.
CEO Tom Albanese commented: "Not all of our divisions are enjoying the same tailwinds. At our November investor seminar, we noted that uncertain macroeconomic conditions, together with stronger currencies in some regions and high raw material costs would result in impairments of our aluminium business. Under these conditions, the full value of our planned improvements in cash margins from existing aluminium operations and from the successful implementation of growth projects is not reflected in the market valuation used for impairment purposes.
"The combination of these factors has led us to write off $8.9 billion of our aluminium assets in 2011. In total, impairments were $9.3 billion which led to a 59 per cent decline in net earnings to $5.8 billion. As the acquisition of Alcan happened on my watch, I felt it only right not to be considered for an annual bonus this year."
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CEO Tom Albanese commented: "Not all of our divisions are enjoying the same tailwinds. At our November investor seminar, we noted that uncertain macroeconomic conditions, together with stronger currencies in some regions and high raw material costs would result in impairments of our aluminium business. Under these conditions, the full value of our planned improvements in cash margins from existing aluminium operations and from the successful implementation of growth projects is not reflected in the market valuation used for impairment purposes.
"The combination of these factors has led us to write off $8.9 billion of our aluminium assets in 2011. In total, impairments were $9.3 billion which led to a 59 per cent decline in net earnings to $5.8 billion. As the acquisition of Alcan happened on my watch, I felt it only right not to be considered for an annual bonus this year."
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