LONDON (TheStreet) -- Rio Tinto (RTP) - Get Report contributed its voice to the chorus of mining-company earnings reports Thursday, and the song remained the same: China saved what would otherwise have been a wretched year, and it will continue to do so in 2010.
The tune is also a highly ironic one, since
Rio Tinto is locked with China in what has become a slowly building international incident
. On Wednesday, Chinese officials indicted four Rio employees on charges of industrial espionage, even as China's steel industry and the world's biggest iron ore miners -- Rio,
Rio Tinto made no reference to the affair in its press release announcing 2009 financial results. It did, however, make note of the fact that China now accounts for nearly a quarter of the company's total revenue, up from 19% a year ago, in yet another indication of how co-dependent China and Rio Tinto (along with most of the world's largest mining companies) have become.
As for those 2009 results, Rio Tinto posted "underlying earnings," a metric that it considers the most accurate reflection of its business performance, that plunged 39% to $6.3 billion. Despite the sharp falloff, the results bested investor expectations. Midday Thursday, Rio's New York-listed American depositary receipts were trading at $204.19, up $4.99, or 2.5%.
BHP and Vale's ADRs, meanwhile, were gaining 3.8% and 2%, respectively. Both companies reported results on Wednesday,
and trumpeting the growth prospects of emerging markets, China, of course, in particular
, but saying basically the same thing.
Rio Tinto, somewhat less bullish than Vale, struck cautious notes in its outlook for the coming year.
"We are mindful," said Rio Chairman Jan du Plessis in a statement, "that the wind down of stimulus packages across the globe and speculative asset bubbles could produce volatility," in 2010. He didn't say, but the chairman may have been referring to China when he mentioned bubbles. The country recently made moves to tighten credit for fear of inducing asset inflation with its robust growth.
Rio Tinto's in-house economists are predicting GDP growth in 2010 for China of 9%, which matches the conventional wisdom.
Rio also declared a 45 cents-per-share dividend. The company had suspended shareholder distributions as it wrestled with a burdensome debt load early in 2009.
-- Written by Scott Eden in New York
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Scott Eden has covered business -- both large and small -- for more than a decade. Prior to joining TheStreet.com, he worked as a features reporter for Dealmaker and Trader Monthly magazines. Before that, he wrote for the Chicago Reader, that city's weekly paper. Early in his career, he was a staff reporter at the Dow Jones News Service. His reporting has appeared in The Wall Street Journal, Men's Journal, the St. Petersburg (Fla.) Times, and the Believer magazine, among other publications. He's also the author of Touchdown Jesus (Simon & Schuster, 2005), a nonfiction book about Notre Dame football fans and the business and politics of big-time college sports. He has degrees from Notre Dame and Washington University in St. Louis.