Elisabeth Behrmann and Soraya Permatasari

RIO Tinto, the third-largest mining company globally, swung to a second-half loss, its first in four years, after taking a $8.9 billion (R67.2bn) one-time charge on the value of its aluminium business.

The loss was $1.76bn in the six months to December, Rio Tinto said yesterday in an e-mailed statement. That compares with a record $8.5bn profit a year earlier.

Deutsche Bank estimated on February 6 that the company would take a charge of $6bn on the unit.

Aluminium, used in cars, packaging and houses, has declined 12 percent in the past year, hurting producers such as United, Rusal and Alcoa, which last month booked its first loss in two years.

Chief executive Tom Albanese and chief financial officer Guy Elliott, declined an annual bonus because the charge related to the $38bn acquisition in 2007 of Alcan, chairman Jan du Plessis said.

Rio Tinto fell 0.2 percent to A$71.60 (R584.57) at the close of Sydney trading yesterday, before the announcement.

The stock has gained 19 percent since the start of the year. The company increased its full-year dividend by 34 percent to A$1.45.

In October Rio Tinto said that it planned to sell 13 aluminium assets, including smelters and alumina plants in Australia, the US and the UK, to improve its finances.

It has cut debt after borrowings ballooned with its purchase of Alcan.

The sale might draw bids from Chinese buyers, Deutsche Bank said.

It reported a 59 percent drop in full-year profit of $5.8bn, with record underlying earnings of $15.5bn, driven by its biggest earning iron ore unit, Rio Tinto said.

Underlying earnings in the second half were $7.8bn. – Bloomberg