Rio Tinto Aims to Increase Aluminum Margin, Return on Capital

By Rhiannon Hoyle

Rio Tinto said it aims to improve the earnings margin and return on capital in its aluminum business over the rest of the decade by lowering costs, increasing its footprint in recycled aluminum and switching to lower-cost renewable power.

The world's second-biggest mining company by market value said it has a plan to raise both the earnings before interest, taxes, depreciation and amortization, or Ebitda, margin and return on capital employed for its aluminum business by five percentage points by 2030.

Rio Tinto said the world aluminum market has a strong outlook because of the metal's role in electrification, and forecast global demand to rise by 3% a year between 2023 and 2028. Recycled metal is likely to account for roughly half that demand growth, the miner said.

The company highlighted North America as the most attractive region for aluminum demand over the next few years, projecting a 4% compound annual growth rate over the same period.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

(END) Dow Jones Newswires

September 24, 2024 19:32 ET (23:32 GMT)

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