MELBOURNE (Reuters) - Global miner Rio Tinto
The world no.2 miner surprised the market with a 15 percent increase in its annual dividend in a show of confidence in its cashflow growth, which may herald a big capital return to shareholders later this year or in 2015.
"The 15 percent increase in our dividend reflects our confidence in the business and its attractive prospects," Chief Executive Sam Walsh, who took the reins a year ago, said in a statement.
Underlying earnings for the six months to December 31 rose to $5.99 billion from $4.12 billion a year earlier, based on Reuters calculations off the full-year result, and compared with analysts' forecasts of around $5.49 billion.
Rio's Australian shares have fallen 3.7 percent over the past year, underperforming a 6 percent rise in the broader market <.AXJO>, as investors shunned miners on fears of cooling growth in China and an expected slump in iron ore prices. However the stock touched an 11-month high on Thursday ahead of the result.
(Reporting by Sonali Paul; Editing by Richard Pullin)