Rio Tinto has taken a hit of nine per cent on underlying earnings in 2014, compared to the previous year, despite a net increase of 78 per cent.
Underlying earnings for 2014 came to US$9.305 billion, down from US$10.2 in 2013.
Walsh said he was pleased the company had significantly increased returns while reducing debt.
“We now have one of the best balance sheets around, providing confidence to sustainably make cash returns to our shareholders,” he said.
“Our continued financial and operating discipline enabled us to offset much of the impact of lower commodity prices in 2014.”
Walsh said over the past two years he had set out to strengthen the company and deliver results for shareholders, as evidenced by a 64 per cent lift in cash returns compared to 2013, a result which was delivered by a 12 per cent increase on dividends and a 2 billion dollar share buyback.
Another US$500 million worth of Rio Tinto shares will be bought back immediately as part of the broader US$2 billion capital return program, with shareholders invited to tender at discounts of between 8 and 14 per cent to the market.
Walsh told reporters via conference call last night that 2015 would be a tough year for the mining industry, but that Rio had been positioning the business for hard times ahead.
The company has sold US$3.9 billion worth of unwanted assets, funds which will be cycled back into the business.
“As a consequence of our disciplined approach to cash management, our net debt finished the year at 12.5 billion dollars, which really is a stunning result in the current market conditions.” Walsh said.
Last week Rio’s Australian iron ore boss Andrew Harding announced to staff that cutbacks would be implemented across the business, which would include quarterly performance reviews for site superintendents, scaling back warehousing and supply, renegotiation of service contracts, changes to scheduled maintenance, and changes to staff pay to reflect market conditions.
Rio Tinto have not elaborated on the cost cutting measures, however Rio Tinto iron ore sites Hope Downs 1 and Hope Downs 4 yesterday cancelled their paid subscriptions to trade publications via an email which said the move was made “in an effort to find cost savings”.