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Segmental information (Tables) | 6 Months Ended
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Jun. 30, 2021
Disclosure of operating segments [abstract] |
Summary of operating segments |
Six months ended 30 June 2021 | Gross product sales(b) US$m | Underlying EBITDA(c) US$m | Underlying earnings(d) US$m | Capital expenditure(e) US$m | Depreciation and amortisation(f) US$m
Iron Ore | 21,707 |  | 16,060 |  | 10,216 |  | 1,912 |  | 1,022 |
Aluminium | 5,932 |  | 1,924 |  | 921 |  | 524 |  | 645 |
Copper | 3,779 |  | 2,048 |  | 885 |  | 750 |  | 523 |
Minerals | 3,270 |  | 1,398 |  | 498 |  | 209 |  | 232 |
Reportable segments total | 34,688 |  | 21,430 |  | 12,520 |  | 3,395 |  | 2,422 |
Other Operations | 85 |  | (4) |  | (51) |  | — |  | 92 |
Inter-segment transactions | (145) |  | (6) |  | (3) |  | — |  | — |
Product group total | 34,628 |  | 21,420 |  | 12,466 |  | 3,395 |  | 2,514 |
Other items | — |  | — |  | — |  | 35 |  | 42 |
Share of equity accounted units(a) | (1,545) |  | — |  | — |  | (120) |  | (249) |
Proceeds from disposal of property, plant and equipment |  | — |  | — |  | 26 |  | — |
Central pensions, share-based payments, insurance and derivatives |  | 119 |  | 120 |  | — |  | — |
Restructuring, project and one-off costs |  | (36) |  | (23) |  | — |  | — |
Central costs |  | (346) |  | (294) |  | — |  | — |
Central exploration and evaluation |  | (120) |  | (100) |  | — |  | — |
Net interest |  | — |  | (3) |  | — |  | — |
Consolidated sales revenue/Capital expenditure/Depreciation and amortisation(g) | 33,083 |  |  |  | 3,336 |  | 2,307 |
Underlying EBITDA/Underlying earnings |  | 21,037 |  | 12,166 |  |  |
Segmental information (continued)
Six months ended 30 June 2020 | Gross product sales(b) US$m | Underlying EBITDA(c) US$m | Underlying earnings(d) US$m | Capital expenditure(e) US$m | Depreciation and amortisation(f) US$m
Iron Ore | 11,465 |  | 7,698 |  | 4,563 |  | 1,185 |  | 840 |
Aluminium | 4,487 |  | 925 |  | 193 |  | 482 |  | 594 |
Copper (Adjusted) | 1,983 |  | 686 |  | 111 |  | 987 |  | 568 |
Minerals (Adjusted) | 2,322 |  | 712 |  | 190 |  | 147 |  | 266 |
Reportable segments total | 20,257 |  | 10,021 |  | 5,057 |  | 2,801 |  | 2,268 |
Other Operations (Adjusted) | 158 |  | 1 |  | (29) |  | 1 |  | 99 |
Inter-segment transactions | (82) |  | (18) |  | (6) |  | — |  | — |
Product group total | 20,333 |  | 10,004 |  | 5,022 |  | 2,802 |  | 2,367 |
Other items | — |  | — |  | — |  | 22 |  | 39 |
Share of equity accounted units(a) | (971) |  | — |  | — |  | (159) |  | (314) |
Proceeds from disposal of property, plant and equipment |  | — |  | — |  | 28 |  | — |
Central pensions, share-based payments, insurance and derivatives |  | 102 |  | 97 |  | — |  | — |
Restructuring, project and one-off costs |  | (72) |  | (53) |  | — |  | — |
Central costs |  | (273) |  | (233) |  | — |  | — |
Central exploration and evaluation |  | (121) |  | (97) |  | — |  | — |
Net interest |  | — |  | 14 |  | — |  | — |
Consolidated sales revenue/Capital expenditure/Depreciation and amortisation(g) | 19,362 |  |  |  | 2,693 |  | 2,092 |
Underlying EBITDA/Underlying earnings |  | 9,640 |  | 4,750 |  |  |
(a)For Gross product sales - share of equity accounted units also includes adjustments for intra-subsidiary/equity accounted units sales. (b)Gross product sales includes the Group’s proportionate share of product sales by equity accounted units (after adjusting for sales to subsidiaries) of US$1,567 million (30 June 2020: US$986 million) which are not included in consolidated sales revenue. Consolidated sales revenue includes subsidiary sales of US$22 million (30 June 2020: US$15 million) to equity accounted units which are not included in gross product sales. (c)Underlying EBITDA represents profit before tax, net finance items, depreciation and amortisation excluding the EBITDA impact of the same items that are excluded in arriving at underlying earnings (as defined below). The reconciliation of underlying EBITDA to profit before taxation can be found on page F-24. (d)Underlying earnings represent net earnings attributable to the owners of Rio Tinto, adjusted to exclude items which do not reflect the underlying performance of the Group’s operations. Exclusions from underlying earnings are those gains and losses that individually, or in aggregate with similar items, are of a nature or size to require exclusion in order to provide additional insight into underlying business performance. The following items are excluded from net earnings in arriving at underlying earnings in each period irrespective of the magnitude: –Net gains/(losses) on disposal and consolidation of interests in businesses. –Impairment charges and reversals. –Profit/(loss) after tax from discontinued operations. –Certain exchange and derivative gains and losses. –The reconciliation of underlying earnings to net earnings can be found on pages F-24 and F-25. (e)Capital expenditure for reportable segments comprises the net cash outflow on purchases less disposals of property, plant and equipment, capitalised evaluation costs and purchases less disposals of other intangible assets. The details provided include 100% of subsidiaries’ capital expenditure and Rio Tinto’s share of the capital expenditure of joint operations and equity accounted units. Segmental information (continued) (f)Product group depreciation and amortisation for reportable segments include 100% of subsidiaries’ depreciation and amortisation and Rio Tinto’s share of the depreciation and amortisation of equity accounted units. Rio Tinto’s share of the depreciation and amortisation charge of equity accounted units is deducted to arrive at depreciation and amortisation as shown in the cash flow statement. These figures do not include impairment charges and reversals, which are excluded from underlying earnings. (g)Capital expenditure and Depreciation and amortisation as reported in the cash flow statement.
| Six months ended 30 June 2021 | Six months ended 30 June 2020
US$m | US$m
Underlying EBITDA | 21,037 |  | 9,640 |
(Losses)/gains on embedded commodity derivatives not qualifying for hedge accounting (including exchange) | (2) |  | 53 |
Change in closure estimates (non-operating and fully impaired sites) | (175) |  | (172) |
Depreciation and amortisation in subsidiaries and equity accounted units(a) | (2,502) |  | (2,288) |
Impairment charges | — |  | (1,163) |
Taxation and finance items in equity accounted units | (365) |  | (141) |
Finance items | 56 |  | (650) |
Profit before taxation | 18,049 |  | 5,279 |
(a)Depreciation and amortisation in subsidiaries and equity accounted units for the period ended 30 June 2021 is net of capitalised depreciation of US$54 million (30 June 2020: US$118 million).
| Pre-tax US$m | Taxation US$m | Non- controlling interests US$m | Net amount for six months ended 30 June 2021 US$m | Net amount for six months ended 30 June 2020 US$m
Underlying earnings | 17,918 | (4,999) | (753) | 12,166 | 4,750
Items excluded from underlying earnings: |  |  |  |  |
Impairment charges(a) | — | — | — | — | (1,033)
Exchange and derivative gains/(losses): |  |  |  |  |
- Exchange gains/(losses) on net debt and intragroup balances(b) | 374 | (34) | 7 | 347 | (149)
- Losses on currency and interest rate derivatives not qualifying for hedge accounting(c) | (52) | 10 | (3) | (45) | (167)
- (Losses)/gains on embedded commodity derivatives not qualifying for hedge accounting(d) | (16) | — | (6) | (22) | 33
Net losses from movements to closure estimates (non-operating and fully impaired sites)(e) | (175) | 42 | — | (133) | (118)
Total excluded from underlying earnings | 131 | 18 | (2) | 147 | (1,434)
Net earnings | 18,049 | (4,981) | (755) | 12,313 | 3,316
(a)Refer to Impairment charges note on pages F-13 and F-14. (b)Exchange gains/(losses) on external net debt and intragroup balances for the period ended 30 June 20 21 comprise of post-tax foreign exchange losses on net debt of US$4 million and post-tax gains of US$351 million on intragroup balances, primarily as a result of the Australian dollar weakening against the US dollar and the Canadian dollar strengthening against the US dollar. Segmental information (continued) Exchange (losses)/gains on external net debt and intragroup balances for the period ended 30 June 2020 comprise post-tax foreign exchange losses on net debt of US$170 million and post-tax gains of US$21 million on intragroup balances, primarily as a result of the Australi an and Canadian dollars both weakening against the US dollar. (c)Valuation changes on currency and interest rate derivatives, which are ineligible for hedge accounting, other than those embedded in commercial contracts, and the currency revaluation of embedded US dollar derivatives contained in contracts held by entities whose functional currency is not the US dollar. (d)Valuation changes on derivatives, embedded in commercial contracts, that are ineligible for hedge accounting, but for which there will be an offsetting change in future Group earnings. (e)In 2021, this amount includes an increase in Diavik's closure provision to reflect the completion of the Pre-Feasibility Study that was in progress when the asset was fully impaired in 2020. As the assets at Diavik had previously been fully impaired this increase has been recognised through the income statement and has been excluded from underlying earnings in line with past practice when impairments have been recorded based on provisional closure estimates. The 2021 charge also includes closure provision increases at some of the Group's legacy sites where the environmental damage preceded ownership by Rio Tinto. In 2020, the Pre-Feasibility Study for the Gove refinery closure was completed, resulting in an increase to the closure provision. As a non-operating asset, this increase was recognised through the income statement. Also in 2020, the feasibility study for the Argyle mine closure was completed, resulting in a decrease to the closure provision. As the assets at Argyle had previously been fully impaired this decrease was recognised through the income statement, in line with previous movements to the closure provision. These movements were excluded from underlying earnings.
Consolidated revenue by destination |
Consolidated sales revenue by destination(a) | Six months ended 30 June 2021 | Six months ended 30 June 2020 | Six months ended 30 June 2021 | Six months ended 30 June 2020
% | % | US$m | US$m
China | 59.9 | % | 54.9 | % | 19,805 | 10,633
Asia (excluding China and Japan) | 9.5 | % | 11.1 | % | 3,157 | 2,155
United States of America | 11.5 | % | 12.4 | % | 3,816 | 2,392
Japan | 7.2 | % | 8.3 | % | 2,373 | 1,598
Europe (excluding UK) | 5.0 | % | 5.9 | % | 1,667 | 1,143
Canada | 2.4 | % | 2.9 | % | 793 | 585
Australia | 1.6 | % | 1.8 | % | 519 | 351
UK | 0.5 | % | 0.6 | % | 166 | 112
Other countries | 2.4 | % | 2.1 | % | 787 | 393
Consolidated sales revenue | 100.0 | % | 100.0 | % | 33,083 | 19,362
(a)Consolidated sales revenue by geographical destination is based on the ultimate country of destination of the product, if known. If the eventual destination of the product sold through traders is not known then revenue is allocated to the location of the product at the time when control is transferred. Rio Tinto is domiciled in both the UK and Australia.
Consolidated sales revenue by product |
| Six months ended 30 June 2021 | Six months ended 30 June 2020
Consolidated sales revenue by product | Revenue from contracts with customers US$m | Other revenue(a) US$m | Consolidated sales revenue US$m | Revenue from contracts with customers US$m | Other revenue(a) US$m | Consolidated sales revenue US$m
Iron ore | 21,964 | 1,108 | 23,072 | 12,182 | 82 | 12,264
Aluminium, Alumina and Bauxite | 5,733 | 84 | 5,817 | 4,454 | (19) | 4,435
Copper | 1,472 | 77 | 1,549 | 642 | (9) | 633
Industrial minerals | 1,141 | 4 | 1,145 | 991 | (7) | 984
Gold | 506 | (6) | 500 | 214 | 4 | 218
Diamonds | 160 | — | 160 | 141 | — | 141
Other products(b) | 827 | 13 | 840 | 692 | (5) | 687
Consolidated sales revenue | 31,803 | 1,280 | 33,083 | 19,316 | 46 | 19,362
Share of equity accounted unit sales and intra-subsidiary/equity accounted unit sales |  |  | 1,545 |  |  | 971
Gross product sales |  |  | 34,628 |  |  | 20,333
(a)Certain of the Group’s products may be provisionally priced at the date revenue is recognised based on forward rates. The subsequent changes in value of provisionally priced receivables through to settlement is classified as ‘Other revenue’ above. (b)"Other products" includes metallic co-products, molybdenum, silver and other commodities. This category also now includes uranium sales of US$76 million (30 June 2020: US$149 million) that were previously disclosed separately.

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