Rio Tinto’s Walsh promises investors $5bn in cost savings

Rio Tinto's (ASX, LON, NYSE:RIO) CEO Sam Walsh told investors the company will focus on divesting non-core assets and disciplined investments that will bring savings of $5 billion ($A4.87 billion) this year.

Speaking at his first annual general meeting as Rio’s head, Walsh said 2012's capital expenditure of $17.4 billion would be the miner’s peak year of investment.

“We are targeting significant cash proceeds from divestments and are reviewing a number of potential non-core assets for divestment, in addition to those we've already announced such as Pacific Aluminum and Diamonds," he told shareholders in London, according to The Australian.

Since assuming Rio’s leadership in January this year, Walsh has taken measures to build a more focused and accountable business.

Aside from selling assets and slashing jobs in the wake of 2012's annual loss, Walsh said that Rio will improve performance at all operations, delivering approved growth projects and strengthening capital allocation and discipline.