Annual Financial Report

RNS Number : 5735I

Rio Tinto PLC

15 March 2010

 



Rio Tinto plc

15 March 2010

RIO TINTO PLC

2009 Annual Report and 2010 Annual General Meeting

Rio Tinto has today issued to shareholders and posted the following documents on its website at:

http://www.riotinto.com/agm2010 

·    2009 Annual report

·    2009 Annual review

·    2010 Rio Tinto plc Notice of annual general meeting

Shareholders will also receive a proxy form in respect of the resolutions proposed in the 2010 notice of annual general meeting.

Rio Tinto has today submitted two copies of these documents to the UK Listing Authority. They will be available for inspection at the Document Viewing Facility which is situated at:

Financial Services Authority

25 The North Colonnade

Canary Wharf

London

E14 5HS

Tel:  [phone]

Rio Tinto plc will hold its 2010 Annual general meeting in London on 15 April 2010 and Rio Tinto Limited will hold its Annual general meeting in Melbourne, on 22 April 2010.

In accordance with LR 12.4.4 Rio Tinto announces its decision to submit to shareholders at the 2010 Annual general meeting a proposal to be generally authorised to buy back shares.  This proposal will restate the authority last granted by shareholders at the 2008 Annual general meeting.

Rio Tinto will announce when its 2009 Annual report on Form 20-F has been filed with the United States Securities and Exchange Commission.

American Depositary Receipt holders can view Rio Tinto's 2009 Annual report, 2009 Annual review, Rio Tinto plc's 2010 Notice of meeting, Rio Tinto Limited 2010 Notice of meeting and, when filed the 2009 Annual report on Form 20-F on the Rio Tinto website at:

http://www.riotinto.com/shareholders/ADRS

A copy of the 2009 Annual report will be delivered to the UK Registrar of Companies in due course and hard copies of all of these documents can be obtained free of charge on request from the company secretaries, whose contact details are as follows:

The Company Secretary Rio Tinto plc 2 Eastbourne Terrace London,  W2 6LG United Kingdom

The Company Secretary Rio Tinto Limited 120 Collins Street Melbourne, 3000 Australia

The Disclosure and Transparency Rules (DTR) require that an announcement of the publication of an Annual report should include the disclosure of such information from the Annual report as is of a type that would be required to be disseminated in a Half-yearly Report in compliance with the DTR 6.3.5(2) disclosure requirement.  Accordingly the following disclosures are made below. This disclosure should be read in conjunction with and not as a substitute for reading the 2009 Annual report. 

1.         Important events during the year

During 2009 and until the date of the 2009 Annual report, the important events affecting the Group have been:

·          The announcement on 12 January 2009 of the appointment of Jacynthe Côté as chief executive, Rio Tinto Alcan, effective 1 February 2009.

·          On 14 January 2009 Jim Leng was appointed as chairman designate and a non executive director. He subsequently resigned on 9 February 2009 and Paul Skinner agreed to remain as chairman. On 18 March 2009 it was announced that Jan du Plessis would be appointed chairman and that Paul Skinner would retire with effect from the conclusion of the 2009 annual general meetings.

·          The announcement on 20 January 2009 that Rio Tinto Alcan planned to implement further production curtailments to align market production with customer demand bringing the total production decrease to approximately 11 per cent of its total annualised aluminium capacity.

·          On 12 February 2009 a proposal for the formation of a strategic partnership with Chinalco was announced but on 5 June 2009, the Group announced that it had terminated the agreement with Chinalco and would pay the agreed break fee of US$195 million.

·          The announcement on 5 June 2009 of a non binding agreement between Rio Tinto and BHP Billiton to establish a production joint venture covering the entirety of both companies' Western Australian iron ore assets and the appointment of Sam Walsh to the board of Rio Tinto with immediate effect. On 15 October 2009 it was agreed that the partners would not proceed with any joint venture marketing activity. On December 2009, binding agreements on the proposed joint venture that cover all aspects of how the joint venture will operate and be governed were signed.

·          The announcement on 5 June 2009 of a fully underwritten rights issue to raise approximately US$15.2 billion of gross proceeds.

·          On 5 July 2009 four employees were detained for questioning by the Chinese authorities in Shanghai. On 11 February 2010 Rio Tinto was advised that the People's Procuratorate had transferred the case to the Shanghai Number One Intermediate Court for trial. The charges related to receiving bribes and stealing commercial secrets.

·          The announcement on 6 July 2009 that Rio Tinto had signed an agreement to sell its Alcan Packaging Food Americas division to Bemis Company, Inc for a total consideration of US$1.2 billion. The sale completed on 1 March 2010.

·          The announcement on 18 August 2009 that a binding offer from Amcor had been received to acquire the majority of the Alcan packaging businesses, comprising Alcan packaging global pharmaceuticals, global tobacco, food Europe and food Asia divisions, for a total consideration of US$2.025 billion which was accepted on 23 December 2009. On 1 February 2010 the majority of the sale completed for US$1,948 million.

·          On 15 September 2009, Rio Tinto announced that it had agreed to the sale of 56 per cent of Alcan Engineered Products Cable division to Platinum Equity, and on 1 December 2009, Rio Tinto completed the sale of Alcan Composites, part of the Alcan Engineered Products division, to Schweiter Technologies for a total consideration of US$349 million. The sale of the Cable division was terminated on 1 December 2009.

·          On 16 October 2009 a number of senior management appointments and changes to Rio Tinto's organisational structure were announced, with effect from 1 November 2009.

·          With effect from 28 October 2009, Rio Tinto cancelled its listing on the New Zealand Stock Exchange.

·          On 23 November 2009 Rio Tinto announced that it would receive total proceeds of at least US$741million in connection with Cloud Peak Energy Inc's initial public offering and related transactions.

·          On 9 February 2010 the Group announced the appointment of Ann Godbehere and Robert Brown as non executive directors with effect from 9 February 2010 and 1 April 2010 respectively and that Sir David Clementi and David Mayhew would retire as non executive directors upon the conclusion of the 2010 annual general meetings.

·          On 1 March 2010, the Group announced it had agreed to acquire 15 million shares in Ivanhoe Mines Ltd at a subscription price of C$16.31 per share, increasing its ownership in Ivanhoe Mines by 2.7 per cent to 22.4 per cent. The total consideration was C$244.7 million.

2.         Principal risks and uncertainties

The following describes some of the material risks that could affect Rio Tinto. There may be additional risks unknown to Rio Tinto and other risks, currently believed to be immaterial, which could turn out to be material. These risks, whether they materialise individually or simultaneously, could significantly affect the Group's business and financial results. It also outlines the exposure to risk without explaining the detail of how each is managed and mitigated, or how some risks could result in either a positive (upside) or negative (downside) impact. They should also be considered in connection with any forward looking statements contained in the 2009 Annual report.

External

Commodity prices and global demand for the Group's products are expected to remain uncertain, which could have a positive or negative impact on the Group's business.

Commodity prices and demand for the Group's products are cyclical and strongly influenced by world economic growth. This is particularly so for our key customers, especially in the US and Asia (notably China). There is potential volatility in short to medium term commodity prices as various national stimulus packages are reduced. Muted consumer spending may result from concerns over unemployment. The Group's normal policy is to sell its products at prevailing market prices and not to enter into price hedging arrangements. The recent improvement in commodity prices and demand for the Group's products may not remain as strong, which would have an impact on Group revenues, earnings, cash flows, asset values and growth.

Continued growth in demand for the Group's products in China could be affected by future developments in that country.

The Group's iron ore is sold to Chinese customers predominantly at fixed prices rather than at spot rates. The 2009 benchmark prices were never officially agreed. Failure to agree on prices remains a source of tension between China and all the major iron ore suppliers.

The slowdown of China's economy in 2009 contributed to a contraction in demand for aluminium and lower aluminium prices. If Chinese customers' demand for the Group's products fails to continue to recover or Chinese customers source such products from elsewhere, the Group's business, financial condition and prospects could be affected.

Rio Tinto is exposed to fluctuations in exchange rates that could have an adverse impact on its overall business results.

The Group uses US dollars to denominate most of its sales, hold surplus cash, finance its operations, and present its external and internal results. Although many costs are incurred in US dollars, significant costs are influenced by the local currencies of the countries where the Group operates, principally the Australian dollar, Canadian dollar and Euro. The Group's normal policy is to avoid hedging arrangements relating to changes in foreign exchange rates. Appreciation in the value of these currencies against the US dollar or prolonged periods of exchange rate volatility may adversely affect the Group's business results.

Political, legal and commercial instability or community disputes in the countries and territories in which the Group operates could affect the viability of its operations.

The Group has operations in jurisdictions with varying degrees of political, legal and commercial stability. Commercial instability can be influenced by bribery and corruption in their various guises. Administrative change, policy reform, and changes in law or governmental regulations can result in civil unrest, increased regulation and potentially expropriation, or nationalisation. Renegotiation or nullification of existing agreements, leases and permits, changes in fiscal policies (including increased tax or royalty rates) or currency restrictions as well as significantly increased costs or impediments to operation are all possible consequences. Such instability could have an adverse effect on the profitability, the ability to finance or, in extreme cases, the viability of an operation.

Some of the Group's current and potential operations are located in or near communities that may regard the operation as being detrimental to their environmental, economic or social circumstances. Community reaction could have an adverse impact on the cost, profitability, ability to finance or even the viability of an operation. Such events could lead to disputes with national or local governments or with local communities and give rise to reputational damage. If the Group's operations are delayed or shut down as a result of political and community instability, its revenue growth may be constrained and the long term value of its business could be adversely impacted.

The Group's land and resource tenure could be disputed resulting in disruption to the operation or development of a resource.

The Group operates in several countries where title to land and rights in respect of land and resources (including indigenous title) may be unclear and may lead to disputes over resource development. Such disputes could disrupt or delay relevant mining projects, impede the Group's ability to develop new mining properties, and may have an adverse effect on the Group's results of operations or its prospects.

Changes in the cost and/or interruptions in the supply of energy, water, fuel or other key inputs could adversely affect the economic viability of the Group's operations.

The Group's operations are resource intensive and, as a result, its costs and net earnings may be adversely affected by the availability or cost of energy, water, fuel or other key inputs. If the prices of key inputs rise significantly more than expected, or if the Group experiences interruptions in, or constraints on, its supply of key inputs, the Group's costs could increase and its results could be adversely affected.

Strategic

Failure of the Group to make or successfully integrate acquisitions could have an adverse effect on the business and results of operations.

Business combinations entail a number of risks including the effective integration of acquisitions (including the realisation of synergies), significant one time write-offs or restructuring charges, and unanticipated costs and liabilities. All of these may be exacerbated by the diversion of management's attention away from other ongoing business concerns. The Group may also be liable for the past acts, omissions or liabilities of companies or businesses or properties it has acquired, which may be unforeseen or greater than anticipated.

The Group's business and growth prospects may be negatively affected by reductions in its capital expenditure programme.

The Group requires substantial capital to invest in greenfield and brownfield projects, and to extend the life and capacity of its existing operations. Reductions in capital expenditure (including sustaining capital) have resulted in the cancellation, slowing or deferral of projects until market conditions and commodity prices recover, and sufficient cash is available for investment. If significant variations in commodity prices or demand for our products occurs, the Group may reduce its capital expenditure further, which may negatively impact the timing of its growth and future prospects.

With the volatility of the commodity markets, the Group's ability to take advantage of improvements may be constrained by earlier capital expenditure restrictions and the long term value of its business could be adversely impacted.

The Group's exploration and development of new projects might be unsuccessful, expenditures may not be fully recovered and depleted ore reserves may not be replaced.

The Group develops new mining properties and expands its existing operations as a means of generating shareholder value. The Group seeks to identify new orebodies and mining properties through its exploration programme and has also undertaken the development or expansion of other major operations. There is a high degree of competition for opportunities to develop such orebodies. Certain competitors, such as state run interests, have access to significant resources and may be motivated by political or other non economic factors. The Group may be unable to find willing and suitable joint venture partners to share the cost of developing large projects. There is no assurance, therefore, that the Group's investment in exploration and project development will be recouped, or that depleted ore reserves will be replaced.

The Group's proposed iron ore production joint venture with BHP Billiton in Western Australia may not yield the synergies anticipated, or may fail to be completed as currently envisaged.

Rio Tinto and BHP Billiton have proposed a production joint venture covering the entirety of both companies' Western Australian iron ore assets. The binding agreements on the proposed joint venture were signed on 5 December 2009, and cover all aspects of how the joint venture would operate and be governed. The estimated US$10 billion net present value of the synergies may not be realised or may take longer to realise than expected. The proposed production joint venture requires regulatory approvals in a number of jurisdictions which may not be secured. Regulators may require the Group to relinquish ownership or control over certain assets prior to approving the production joint venture. Any or all of these could reduce the value anticipated from forming the production joint venture or result in a failure to implement the venture as currently envisaged.

Financial

The Group's reported results could be adversely affected by the impairment of assets and goodwill.

An asset impairment charge may result from the occurrence of unexpected adverse events that impact the Group's expected performances. In accordance with IFRS, the Group does not amortise goodwill but rather tests it annually for impairment: such impairments cannot be reversed.

The Group will continue to test goodwill and may, in the future, record additional impairment charges. This could result in the recognition of impairment provisions (which are non cash items) that could be significant and could have an adverse effect on the Group's reported results.

The Group's net earnings are sensitive to the assumptions used for valuing defined benefit pension plans and post retirement healthcare plans.

Certain of the Group's businesses sponsor defined benefit pension plans. The pension expense reported for these plans is sensitive to the assumptions used to value the pension obligations, and also to the underlying economic conditions that influence the assumptions. Changing economic conditions, particularly poor pension investment returns, may require the Group to make substantial cash contributions to its pension plans.

Actual investment returns achieved compared to the amounts assumed within the Group's reported pension expense are reported in the table below (amounts for prior years have been adjusted to exclude defined contribution assets as explained in note 50 to the financial statements).

As at 31 December 2009, the Group had estimated pension liabilities (on an IAS19 accounting basis) of US$16.2 billion and assets of US$12.4 billion. After excluding those pension arrangements deliberately operated as unfunded arrangements, representing liabilities of US$1.1 billion, the global funding level for pension liabilities (on an IAS19 basis) was approximately 82 per cent. If the funding level materially deteriorates further, cash contributions from the Group may be needed, subject to local requirements.

Pension plan investment returns

US$ millions	2009	2008	2007	2006	2005
Expected return on plan assets	581	857	438	261	249
Actual return on plan assets	1,472	(2,451)	309	517	365
Difference between the expected and actual return on plan assets (loss)/gain (US$ million)	891	(3,308)	(129)	256	116
Difference as a percentage of plan assets	7%	(36%)	(1%)	5%	3%

Operational

Estimates of ore reserves are based on many assumptions and changes in the assumptions could lead to reported ore reserves being restated.

There are numerous uncertainties inherent in estimating ore reserves including subjective judgements and determinations based on available geological, technical, contract and economic information. Assumptions that are valid at the time of estimation may change significantly when new information becomes available. Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may result in the reserves ceasing to be economically viable. Ultimately this may result in the reserves needing to be restated. Such changes in reserves could also affect depreciation and amortisation rates, asset carrying values, deferred stripping calculations and provisions for close down, restoration and environmental clean up costs.

Labour disputes could lead to lost production and/or increased costs.

Some of the Group's employees, including employees in non managed operations, are represented by labour unions under various collective labour agreements. The Group may not be able satisfactorily to renegotiate agreements when they expire and may face tougher negotiations or higher wage demands. In addition, existing labour agreements may not prevent a strike or work stoppage, which could have an adverse effect on the Group's earnings and financial condition.

Some of the Group's technologies are unproven and failures could adversely impact costs and/or productivity.

The Group has invested in and implemented information systems and operational initiatives including new technologies. Some aspects of these technologies are unproven and the eventual operational outcome or viability cannot be assessed with certainty. The costs, productivity, value in securing business opportunities and other benefits from these initiatives, and the consequent effects on the Group's future earnings and financial results may vary from expectations. If the Group's technology systems fail to realise the anticipated benefits, there is no assurance that this will not result in increased costs, interruptions to supply continuity, failure of the Group to realise its production or growth plans or some other adverse effect on operational performance.

The Group's mining operations are vulnerable to natural disasters, operating difficulties and infrastructure constraints, not all of which are covered by insurance, which could have an impact on its productivity.

Mining operations are vulnerable to natural events, including earthquakes, drought, floods, fire, storms and the possible effects of climate change. Operating difficulties such as unexpected geological variations that could result in significant failure, could affect the costs and viability of operations for indeterminate periods, including smelting and refining.

The Group requires reliable roads, rail networks, ports, power sources and power transmission facilities, water supplies and IT systems to access and conduct its operations. The availability and cost of infrastructure affects capital and operating costs, and the maintenance of planned levels of production and sales. In particular, the Group transports a large proportion of its products by sea. Limitations, or interruptions in, rail or shipping capacity at any port, including as a result of third parties gaining access to the Group's integrated infrastructure, could impede the Group's ability to deliver its products on time. This could have an adverse effect on the Group's business and results of operations.

The Group uses an extensive information technology system and infrastructure. A significant failure of major parts of the system or malicious actions could result in significant interruption that could affect the Group's reputation and operating results.

The Group's insurance does not cover every potential risk associated with its operations. Adequate coverage at reasonable rates is not always obtainable. In addition, the Group's insurance may not fully cover its liability or the consequences of any business interruptions such as equipment failure or labour dispute. The occurrence of a significant event not fully covered by insurance could have an adverse effect on the Group's business, results of operations, financial condition and prospects.

Joint ventures and other strategic partnerships may not be successful and non managed projects and operations may not comply with the Group's standards, which may adversely affect its reputation and the value of such projects and operations.

The Group participates in several joint venture arrangements and it may enter into further joint ventures. Although the Group has sought to protect its interests, existing and future joint ventures necessarily involve special risks. Whether or not the Group holds majority interests or maintains operational control in its joint ventures, its partners may:

·          have economic or business interests or goals that are inconsistent with, or opposed to, those of the Group;

·          exercise veto rights to block actions that the Group believes are in its or the joint venture's best interests;

·          take action contrary to the Group's policies or objectives with respect to its investments; or

·          be unable or unwilling to fulfil their obligations under the joint venture or other agreements, such as contributing capital to expansion or maintenance projects.

Where projects and operations are controlled and managed by the Group's partners, the Group may provide expertise and advice but it has limited control with respect to compliance with its standards and objectives. Improper management or ineffective policies, procedures or controls could adversely affect the value of related non managed projects and operations and, by association, damage the Group's reputation thereby harming the Group's other operations and access to new assets.

The Group may be exposed to major failures in the supply chain for specialist equipment and materials.

Rio Tinto operates within a complex supply chain depending on suppliers of raw materials, services, equipment and infrastructure to ensure its mines and process plants can operate, and on providers of logistics to ensure products are delivered. Failure of significant components of this supply chain due to strategic factors such as business failure or serious operational factors, could have an adverse effect on the Group's business and results of operations.

Sustainable development

Increased regulation of greenhouse gas emissions could adversely affect the Group's cost of operations.

Rio Tinto's operations are energy intensive and depend heavily on fossil fuels. There is increasing regulation of greenhouse gas emissions, progressive introduction of carbon emissions trading mechanisms and tighter emission reduction targets, in numerous jurisdictions in which the Group operates. These are likely to raise energy and production costs to a material degree over the next decade. Regulation of greenhouse gas emissions in the jurisdictions of the Group's major customers and suppliers as well as in relation to international shipping could also have an adverse effect on the demand for the Group's products.

The Group depends on the continued services of key personnel.

The Group's ability to maintain its competitive position and to implement its business strategy is dependent on the services of key engineering, managerial, financial, commercial, marketing and processing people. Loss or diminution in the services of key employees, particularly as a result of an inability to attract and retain staff, or the Group not maintaining a competitive remuneration structure, could have an adverse effect on the Group's business, financial condition, results of operations and prospects.

Competition for experienced people with international engineering, mining, metallurgy and geological expertise is high, due to a small pool of individuals against medium to high demand. This may affect the Group's ability to retain its existing senior management, marketing and technical personnel and to attract qualified personnel on appropriate terms. Similar competition may be felt by the Group's key contractors and equipment suppliers that, in turn, could affect the Group's expansion plans.

The Group's costs of close down, restoration, and rehabilitation could be higher than expected due to unforeseen changes in legislation, standards and techniques, or underestimated costs.

Close down and restoration costs include the dismantling and demolition of infrastructure and the remediation of land disturbed during the life of mining and operations. Estimated costs are provided for over the life of each operation and updated annually but the provisions might prove to be inadequate due to changes in legislation, standards and the emergence of new restoration techniques. Furthermore the expected timing of expenditure could change significantly due to changes in commodity prices that might curtail the life of an operation. Total provisions at 31 December 2009 amounted to US$6,916 million (2008 restated: US$6,011 million) as set out in note 27 to the financial statements. These provisions could prove insufficient compared to the actual cost of restoration, or the cost of remediating or compensating for damage beyond the site boundary. Any underestimated or unidentified close down, restoration and environmental rehabilitation costs could have an adverse effect on the Group's reputation as well as its asset values, earnings and cash flows.

Health, safety, environment and other regulations, standards and expectations evolve over time and unforeseen changes could have an adverse effect on the Group's earnings and cash flows.

Rio Tinto operates in an industry that is subject to numerous health, safety and environmental laws, regulations and standards as well as community and stakeholder expectations. The Group is subject to extensive governmental regulations in all jurisdictions in which it operates. Operations are subject to general and specific regulations governing mining and processing, land tenure and use, environmental requirements (including site specific environmental licences, permits and statutory authorisations), workplace health and safety, social impacts, trade and export, corporations, competition, access to infrastructure, foreign investment and taxation. Some operations are conducted under specific agreements with respective governments and associated acts of parliament but unilateral variations could diminish or even remove such rights. Evolving regulatory standards and expectations can result in increased litigation and/or increased costs, all of which can have an adverse effect on earnings and cash flows.

3.         Related party transactions

Information about material related party transactions of the Rio Tinto Group is set out below:

Equity accounted units

Transactions and balances with equity accounted units are summarised below. Purchases relate largely to amounts charged by jointly controlled entities for toll processing of bauxite and alumina. Sales relate largely to charges for supply of coal to jointly controlled marketing entities for onward sale to third party customers.

Income statement items	2009 US$m	2008 US$m
Purchases from equity accounted units	(2,558)	(2,770)
Sales to equity accounted units	2,088	3,011

Balance sheet items	US$m	US$m
Investments in equity accounted units (note 14) (a)	6,735	5,053
Loans to equity accounted units	338	515
Loans from equity accounted units	(157)	(195)
Trade and other receivables: amounts due from equity accounted units (note 17)	941	688
Trade and other payables: amounts due to equity accounted units (note 25)	(402)	(280)

Cash flow statement items	US$m	US$m
Net funding of equity accounted units	(265)	(334)

(a) Further information about investments in equity accounted units is set out in notes 38 and 39 of the financial statements.

In November 2009, as part of the disposal process of Cloud Peak, Rio Tinto Energy America Inc. and Cloud Peak Energy Resources LLC (CPER) agreed for existing Rio Tinto plc guaranteed surety bonds and letters of credit, principally securing the reclamation obligations for the Cloud Peak business, to continue for a transition period. The surety bonds are expected to be replaced by CPER during the first half of 2010. The amount outstanding on these guarantees at the year end is US$449 million.

4.         Directors' responsibility statement

Directors' statement of responsibilities in relation to the Group financial statements, Rio Tinto plc financial statements and Rio Tinto Limited financial statements

The directors are responsible for preparing the Annual report, the Remuneration report and the financial statements in accordance with applicable law and regulations.

UK and Australian company law requires the directors to prepare financial statements for each financial year. Under these laws the directors have elected to prepare the Group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union, the Rio Tinto plc financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law) and the Rio Tinto Limited parent company financial statements in accordance with Australian International Financial Reporting Standards (AIFRSs). In preparing the Group financial statements, the directors have also elected to comply with IFRSs, issued by the International Accounting Standards Board (IASB). Under UK and Australian company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the companies and of the profit or loss of the companies and Group for that period. In preparing these financial statements, the directors are required to:

·    select suitable accounting policies and then apply them consistently;

·    make judgements and estimates that are reasonable and prudent;

·          state whether IFRSs as adopted by the European Union, applicable UK Accounting Standards and AIFRSs have been followed, subject to any material departures disclosed and explained in the Group and parent company financial statements respectively;

·          prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the companies will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the transactions of the companies and the Group and disclose with reasonable accuracy at any time the financial position of the companies and the Group and enable them to ensure that the Group financial statements comply with the Companies Act 2006, the Corporations Act 2001 as amended by the Australian Securities and Investments Commission Order dated 27 January 2006 (as amended on 22 December 2006) and Article 4 of the IAS Regulation, the Rio Tinto plc financial statements comply with the Companies Act 2006, the Rio Tinto Limited parent company financial statements comply with the Corporations Act as amended by the Australian Securities and Investments Commission Order dated 27 January 2006 (as amended on 22 December 2006) and the Remuneration Report complies with the Companies Act 2006, the Corporations Act 2001 as amended by the Australian Securities and Investments Commission Order dated 27 January 2006 (as amended on 22 December 2006) and Australian Accounting Standard AASB 124 'Related Party Disclosure'.

They are also responsible for safeguarding the assets of the companies and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the Group's website. Legislation governing the preparation and dissemination of financial statements may differ between jurisdictions in which the Group reports.

Each of the current directors, whose names and function are listed on pages 84 to 87 in the Governance section of the Annual report confirm that, to the best of
their knowledge:

·          the Rio Tinto Group financial statements and notes, which have been prepared in accordance with IFRS as adopted by the EU, Corporations Act 2001 as amended by the Australian Securities and Investments Commission Order dated 27 January 2006 (as amended on 22 December 2006), Companies Act 2006 and Article 4 of the IAS Regulation, give a true and fair view of the assets, liabilities, financial position and profit of the Group; and

·          the Rio Tinto plc financial statements and notes, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice and the Companies Act 2006 give a true and fair view of the assets, liabilities, financial position and profit of the company.

·          the Rio Tinto Limited parent company financial statements and notes, which have been prepared in accordance with Australian International Financial Reporting Standards (AIFRSs) and Corporations Act 2001 as amended by the Australian Securities and Investments Commission Order dated 27 January 2006 (as amended on 22 December 2006) give a true and fair view of the assets, liabilities, financial position and profit of the company.

·          the Overview and Performance sections of the Annual report include a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces.

·          there are reasonable grounds to believe that each of the Rio Tinto Group, Rio Tinto plc and Rio Tinto Limited will be able to pay its debts as and when they become due and payable.

The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the Corporations Act 2001.

Disclosure of information to auditors

The directors in office at the date of this report have each confirmed that:

·          so far as he or she is aware, there is no relevant audit information of which the Group's auditors are unaware; and

·          he or she has taken all the steps that he or she ought to have taken as a director to make himself or herself aware of any relevant audit information and to establish that the Group's auditors are aware of that information.

This declaration is made in accordance with a resolution of the board.

Jan du Plessis Chairman 5 March 2010

Tom Albanese Chief executive 5 March 2010

Guy Elliott Chief financial officer 5 March 2010

Further information please contact:

Matthew Whyte

Acting Deputy Company Secretary

Office: [phone]

email: [e-mail]

 

END

 

 

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