Record earnings advance, record investment and major capital management programme

2 February 2006

• Underlying earnings* of $4,955 million were $2,683 million or 118 per cent above 2004.
• Net earnings* were $5,215 million compared with $3,297 million in 2004.
• Strong operational performance enabled record volumes of most products to be delivered. Higher volumes increased underlying earnings by $1,140 million.
• Cashflow from operations was a record $8,257 million, 85 per cent higher than achieved in 2004.
• The final dividend under the progressive ordinary dividend policy brings total dividends for the year to US 80 cents per share, an increase of four per cent from 2004.
• Investment in the growth of the business continued, with capital expenditure at a record of $2,552 million. This is expected to grow further in 2006 and 2007.
• A major capital management programme totalling $4 billion is announced, comprising a $1.5 billion special dividend (equivalent to $1.10 per share), and a share buyback programme totalling $2.5 billion by the end of 2007. This replaces the $0.5 billion remaining from the 2005 programme.
• The construction of the first phase of the major port and rail infrastructure expansion for the Australian iron ore operations was completed on schedule and on budget in 2005.
• Significant new investments were approved in a further stage of the expansion of the Australian iron ore operations, in the titanium dioxide project in Madagascar and Canada, in the Cortez Hills gold joint venture in the USA and in the Argyle Diamonds underground mine development in Australia.
• The Group’s long term commitment to exploration is underlined by the recent announcement of a significant new exploration joint venture with Norilsk Nickel in Russia.
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