Global miner Rio Tinto will slash costs and sell poorly performing assets after posting its first-ever net loss, almost $3 billion for 2012.
New chief executive Sam Walsh said the world's second largest iron ore miner would aggressively pursue asset sales after unveiling plans to cut costs by more than $US5 billion ($A4.86 billion) by the end of 2014.
That includes reducing capital expenditure on approved and sustaining projects to about $US13 billion ($A12.64 billion) in 2013 and lowering exploration and evaluation spending by $US750 million ($A728.97 million) (pre-tax) in 2013 compared with 2012.
Rio's bottom line was pulled back by $US14 billion ($A13.61 billion) in writedowns and its underlying earnings fell 40 per cent to $US9.3 billion ($A9.04 billion).
The earnings result was above analysts' expectations.
Last month, Rio wrote down its aluminium assets and a coal project in Mozambique to the tune of $US14 billion ($A13.61 billion), leading to chief executive Tom Albanese's departure.
Mr Walsh said there had been instances of poor judgement in relation to acquisitions which he and the board found unacceptable and disappointing.
"Let me assure you we won't pursue growth for growth's sake," Mr Walsh said.
"Cost reductions are coming across the board in relation to our operations."
Mr Walsh said his immediate priority was to build more focus, discipline and accountability throughout the organisation as it made divestments of non-core businesses in 2013.
"We will deliver our capital reduction and cost savings targets and improve performance across our business.
He said the company's core strategy remained unchanged, but changes were afoot in how that strategy was delivered.
Rio also plans to lower exploration and evaluation spending by $750 million (pre-tax) in 2013 compared with 2012.
Still, he painted a rosy picture of the company's major customers.
"China has achieved a soft landing," Mr Walsh said.
The company expects the positive momentum in the fourth quarter of last year to be sustained into 2013 with Chinese GDP growth returning to above eight per cent in 2013.
Rio generated strong margins in copper, iron ore and minerals last year but the aluminium and energy businesses faced a deterioration in market conditions coupled with rising costs.
However, the company expects market uncertainty and price volatility to persist as long as the structural issues in Europe and the United States remain unresolved.
Rio expects iron ore and copper volumes to grow, as it accelerates its Pilbara iron ore to be completed during the third quarter of 2013.
Iron ore comprises at least 80 per cent of the company's earnings.
The Oyu Tolgoi copper-gold mine in Mongolia is being commissioned with first commercial production scheduled by the end of June 2013.
But Mr Walsh remains concerned about investment agreement with Mongolian government following a recent dispute.
He also said that Rio Tinto was negotiating the sale of subsidiary Pacific Aluminium with Meridian.
Pacific Aluminium announced on Wednesday it will keep open its giant loss-making Gove alumina refinery near Nhulunbuy in the Northern Territory, following a deal with the Northern Territory government.
While he declined to estimate how much minerals resource tent tax (MRRT) the company would pay in fiscal 2013, Mr Walsh revealed Rio paid no MRRT in 2012.
He said the MRRT was operating as designed and Rio needed a solid, steady tax regime to continue investing in Australia.
Rio Tinto has boosted its full-year dividend by 15 per cent to US$1.67.
Rio, formed in London in 1873 to mine copper along the Tinto river in southern Spain, hasn't posted an annual loss since before it became a dual-listed company with the merger of its UK and Australian assets in 1995.
UBS analyst Glyn Lawcock said Rio appears upbeat, with the company experiencing positive momentum in the final quarter of 2012 and into 2013.