ERA half year results 2006

Rio Tinto PLC
26 July 2006

Rio Tinto's 68.4 per cent owned subsidiary, Energy Resources of Australia (ERA),
issued the following news release in Australia today.





ERA half year results 2006


                                                  Six months ended    Six months ended       Change
                                                      30 June 2006        30 June 2005


Revenue (A$ million)                                         154.7               129.8        19.2%
Earnings before interest and tax (A$ million)                 32.9                25.0        31.6%
Net profit after tax (A$ million)                             19.9                17.0        16.9%
Interim dividend (cents per share)                             6.0                 6.0           0%
U3O8 production (tonnes drummed)                             1,988               2,714      (26.8)%
U3O8 sold tonnes                                             3,198               3,000         6.6%



Profit



ERA recorded a net profit after tax of A$19.9 million for the half-year ended 30
June 2006 compared with a profit of A$17.0 million for the same period in 2005.



Operations



Drummed production for the half year was 1,988 tonnes of uranium oxide (2005:
2,714 tonnes of uranium oxide). This was lower than the corresponding period
last year due to wet weather associated with cyclone Monica and unusually high
rainfall throughout the wet season that prevented access to higher grade ore.
Production was further impacted by a difficulties experienced in bringing the
acid plant back to full production after a planned maintenance shutdown.



As the wet season abated a number of programs to expedite the removal of water
from the operating pit, largely through accelerating evaporation, were
initiated. The delay in accessing the higher grade ore at the bottom of the
operating pit meant that the average plant feed grade was lower, resulting in
lower than planned uranium oxide production.



During the second quarter a number of operational difficulties were experienced
with the acid plant. A shutdown of the plant to carry out planned repairs and
maintenance took place in April. Cyclone Monica caused the shutdown schedule to
be extended and the resulting shortage of acid curtailed processing of ore. The
shortage of acid continued following difficulties experienced in the acid plant
after the start-up. These persisted until late May. The plant was returned to
full production in early June and acid inventory levels have since recovered.



Revenue and Costs



Sales for the period were 3,198 tonnes which included no new borrowed material
(2005: 3,000 tonnes, including 113 tonnes of borrowed material). Revenue for the
period was A$154.7 million (2005: A$129.8 million). ERA's average contractual
sales price is only partially influenced by the spot market due to the portfolio
of contracts containing a range of pricing mechanisms entered into when the
uranium oxide market was considerably weaker. The average realised sales price
of uranium oxide was US$15.57 per pound (2005: US$14.64 per pound).



Finished product inventory levels were drawn down during the half year in order
to ensure sales commitments were met. Customers continued to exercise upward
volume flexibilities in existing contracts. A quantity of 158 tonnes was
borrowed in 2005 and this loan remains outstanding. The company settled US$33
million (2005: US$34 million) in forward exchange contracts during the period at
an average $A:US$ exchange rate of 67 cents (2005: 65 cents). No new currency
exchange contracts were entered into during the year.



Unit operating costs were higher than the corresponding period last year due to
expenditure on removing surplus water from the operating pit, lower production
volumes and higher fuel prices.. The addition to reserves in October 2005 meant
that units of production depreciation and amortisation charges were lower than
the corresponding period last year.  Taxation expense was higher than in 2005
due to both the higher taxation charge on profit and the change to accounting
policies on transition to IFRS in 2005.



Cash flow



The net operating cash flow of A$77.7 million (2005: A$23.1 million) was higher
due to the higher sales price realization and a favorable $A:US$ average
exchange rate received of 72.2 cents (2005: 75.9 cents).



Dividends



ERA Directors declared an interim dividend of six cents per share, (2005
interim: six cents per share) fully franked at 30 per cent. The dividend will be
paid on 31 August 2006 to those shareholders registered on 17 August 2006.



Outlook for 2006



As a result of the operational difficulties experienced in the first half of the
year, production for 2006 is forecast to be lower than in 2005. Sales volumes in
the second half of the year are expected to be lower than in the first half.
Full year sales are expected to be comparable with 2005. In order to supplement
acid inventories, a program of higher price imports was initiated in June. The
higher costs associated with this will have a negative impact on the price of
consumables used in production.



Exploration drilling will continue in the second half of the year both on the
eastern vicinity of Ranger's current operating pit and on other targets in the
Ranger project area following interpretation of results of the airborne
geophysical surveys conducted in 2005.



Uranium prices continue to strengthen and the average long term market price in
June was US$46.75 per pound (2005: US$30.00 per pound).  The full impact of this
increase in the long term price will only flow through to sales contract prices
as new contracts come into effect.





For further information, please contact:

LONDON                                             AUSTRALIA

Media Relations                                    Media Relations
Nick Cobban                                        Ian Head
Office:  [phone]                      Office:  [phone]
Mobile: [phone]                       Mobile: [phone]

Investor Relations                                 Investor Relations

Nigel Jones                                        Dave Skinner
Office: [phone]                       Office:  [phone]
Mobile: [phone]                       Mobile: [phone]



David Ovington                                     Susie Creswell
Office:  [phone]                      Office:  [phone]
Mobile: [phone]                       Mobile: [phone]



Website: www.riotinto.com
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