The ASX mining share Rio Tinto Ltd (ASX: RIO) saw plenty of volatility over the 12 months ending 30 June 2024. Rio Tinto shares rose by 3.75%, while the S&P/ASX 200 Index (ASX: XJO) increased by 7.8%.
With China's changing economic conditions, investors have had to accept an uncertain outlook for Rio Tinto shares.
The ASX mining share produces a number of commodities, including iron ore, copper and aluminium. Iron ore usually generates the lion's share of the company's earnings.
Things may be looking up for the miner after the iron ore price jumped to US$113 per tonne from around US$106 per tonne a week ago.
According to Trading Economics, there are hopes that China will introduce more stimulus measures at the upcoming Third Plenum this month and announce plans for "comprehensively deepening reform and advancing Chinese modernization." A rising iron ore price supports the Rio Tinto share price.
The website said weak US data could also spur a rate cut, boost global demand, and support commodity prices.
Rio Tinto's financial calendar follows the calendar year, while it was the Australian tax year that just finished. Let's remind ourselves what Rio Tinto has reported during 2024 and what the earnings outlook is for the business.
Recent events
In February 2024, the business reported its 2023 full-year result.
It reported that operating cash flow dropped 6% to US$15.16 billion and free cash flow declined 15% to US$7.66 billion. Net profit after tax (NPAT) declined 19% to US$10 billion. In addition, the company cut the ordinary dividend by 12% to US$4.35 per share.
In mid-April, the business reported its 2024 first-quarter production result. This showed Pilbara iron ore production of 77.9mt, down 2% year over year and 11% lower than the fourth quarter.
Its first-quarter mined copper production was up 7% year over year to 156kt. Aluminium production was up 5% year over year to 826kt.
Outlook on Rio Tinto shares
The miner is working on a number of projects which could help future earnings.
It's ramping up underground copper production at the Oyu Tolgoi mine in Mongolia. Rio Tinto and its partners are building a mine and 600km of new rail at the Simandou mine in Guinea (Africa) to unlock "incredibly high-grade iron ore," which will "unlock low-carbon steel making."
Finally, the Rincon lithium project in Argentina has seen progress in developing a small battery-grade lithium carbonate plant, where production is expected to start by the end of the year.
According to the estimates by the broker UBS, in FY24 Rio Tinto is expected to generate US$52.3 billion of revenue, NPAT of US$12.1 billion and pay a dividend per share of US$4.48. The balance sheet is projected to be in a net debt position of US$1.5 billion at the end of FY24.
In FY25, UBS predicts that Rio Tinto could generate US$52.5 billion of revenue, net profit of US$12.3 billion and pay a dividend per share of US$4.56. The balance sheet is projected to be in a net cash position of US$574 million at the end of FY25.
