In 2011 its first half profit was a hair over $8 billion. For the 2012 half year is was a hair over $6 billion.

Despite that, dividends will be up. The company has announced an interim dividend of US72.5c, up 34% from the US54c it offered a year ago.

The company also completed a $7 billion share buy-back program at the end of the first quarter.

Not surprisingly the company’s underlying earnings were down, in this case by 34% year on year to $5.2 billion. Net earnings of $5.9 billion were down 22%.

Underlying earnings before interest, tax, depreciation and amortisation was down 29% to just over $10 billion.

Cash flow from operations dropped 39% to $7.8 billion.

All of this in spite of a record operational performance from Rio Tinto’s iron ore division.

Its Pilbara iron ore network is operating at increased capacity of 230 million tonnes per annum. That follows the completion of a second low-capital debottlenecking project – a benefit of the remote operating centre the company set up near the Perth Airport. That centre gives the company a handy overview of its entire iron ore operation.

Phase one of the Pilbara iron ore expansion to take those operations to 283Mtpa remains on track for completion by the end of 2013. The push to take those operations to 353Mtpa is expected to be operational by the first half of 2015.

Another operational highlight for the half year was the shipping of the first cargo of premium hard coking coal from the Benga mine in Mozambique.

Despite the financial pain, Rio Tinto is going ahead with its growth program. The company spent $7.6 billion in 2012 and expects to continue with the rest of the $13.6 billion spend it has earmarked for its projects this year.

Factoring in payments from other parties involved in the projects, the total capital expenditure on those projects for the full year will be $16 billion.

Rio Tinto chairman Jan du Plessis bemoaned the lower prices for the company’s commodities, blaming them for the reduction in underlying earnings.

However, he said the company continued to generate strong earnings and cashflows.

“While we are mindful of short-term uncertainties, we remain convinced of the strength of the long-term demand outlook,” du Plessis said.

Chief executive Tom Albanese said the company was reaping the benefit of investing early in iron ore, which was generating strong returns.

“We have been signalling for some time that markets would remain volatile and we have seen challenging conditions in the first half,” he said, before pointing out that the company’s order books remained full.

“We expect to see signs of improvements in Chinese economic activity by the end of the year, with growth picking up more strongly as government stimulus measures announced in the second quarter begin to flow through to infrastructure investment.”

Albanese said the company’s development push would start to pay off soon.

“Many of our projects are close to completion and will start generating revenues in the near term,” he said.

“Benga has already made its first coking coal shipment, the Yarwun 2 alumina refinery is complete and ramping up, Oyu Tolgoi starts commercial production next year and we will increase Pilbara iron ore production capacity by more than 50 million tonnes a year by the end of 2013.”

Albanese said the cost hikes that had blighted the half years for many miners were abating but cost control would remain a major focus all the same.