The RIO dividend will also be chopped

Wednesday, 2 December 2015

Rio’s annual payout will be $US4.1 billion ($5.6 billion) this calendar year, while BHP’s costs $US6.6 billion a year.

“This is a constraining target, and although it provides a level of discipline with capital allocation, they remain cyclical companies with volatile earnings so a target payout ratio band is perhaps more appropriate,” Ms Lopez said.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.