Trott targets $15b overhaul for a slimmed-down Rio Tinto

In his first major strategy update, Rio Tinto (ASX: RIO) chief executive Simon Trott shared his plans to cut costs while targeting up to $15b (US$10b) in asset sales.

Rio Tinto is reviewing its noncore assets for sale, with a strategic review of iron, titanium and borates underway.

Mr Trott says Rio is looking to become the “most valued” mining company under a strategy that streamlines its three core businesses: iron ore, copper, and aluminium and lithium.

Rio is already benefitting from Mr Trott’s shake-up, which included a streamlined workforce and executive team. The miner expects $982m (US$650m) in productivity benefits, driven by a simplified organisation, stronger operational discipline and a sharper focus on its core portfolio.

Mr Trott says the miner is building from a position of strength, sharpening and simplifying the business to deliver leading returns.

“We will drive performance through discipline, productivity and unmatched growth to unlock the full potential of our diversified portfolio of world-class assets,” he said.

“We are delivering strong early productivity benefits and cost savings with more to come. Freeing up cash from our asset base where it makes sense will strengthen the balance sheet and maintain returns, as we invest for the future with discipline.

“Our experienced leadership team is committed to delivering against our mission to become the most valued metals and mining company – for shareholders, the people who work with us, our partners and the communities around us.”

Production is solid, with 7% growth expected in 2025 and 3% compound annual production growth outlook to 2030 underpinned by the delivery and ramp-up of developments across core projects such as Oyu Tolgoi, Simandou and Arcadium.

Rio has upped copper and bauxite production guidance. Copper guidance has been upgraded to 860-875kt from the previous 780-850kt with unit cost guidance revised down to 80-100c/lb.

Bauxite production guidance is being upgraded to exceed the previous guidance of 69-61mt.

Guidance for the Iron Ore Company of Canada (IOC) has been downgraded to 9-9.5mt.