Good morning everyone here in London and welcome to those participating via the webcast. Our Chief Executive Sam Walsh is with me here in London and Guy Elliott is presenting from Melbourne. Rio Tinto’s businesses performed well in 2012, generating strong underlying earnings and operating cash flows. However, as foreshadowed a few weeks ago, we also recorded impairments of $14.4 billion, which resulted in the group reporting a net loss in 2012 of $3 billion. These write downs are deeply disappointing. In particular, the substantial impairment of our Mozambique coal business is unacceptable. There clearly is a need for greater discipline – in particular in the way we allocate and manage capital at Rio Tinto. I believe Sam is ideally placed to cast a fresh eye over how we address The challenges and opportunities in the business. He is a highly experienced and capable executive who has already made a significant contribution to Rio Tinto – not only as an executive but as a director of the company. Sam and I – and indeed the whole board are completely aligned on the need to pursue greater value for our shareholders, and we will be working together to achieve this. I can assure you that Sam has hit the ground running, and is already making a tangible difference to the organization. Looking forward, I am optimistic about the outlook for Rio Tinto. We have great assets, attractive near term growth and a positive long term outlook. This gives us confidence in the sustainable cash generating abilities of our business. That is why we have today increased our annual dividend by 15% to $0.0167 per share. That's all from me. Thank you very much, and with that I hand you over to Sam. Sam?

Thank you Jan, and you too for the trust you and the board have placed in me, to lead this company in its pursuit of greater value for our shareholders. It's a trust I feel deeply, which makes me even more conscious with the responsibility that I have taken on. I am setting a clear course, clear objectives and I am determined to deliver them. Let me first recognize my predecessor Tom Albanese, particularly for the support that he had shown me in my new role as Chief Executive. This is a great company. It's got great assets, and I inherit a great team. People that I know well from my 21 years with the company. I am confident in our core strengths and in my ability to lead the team. I am proud of my record, and the success of our iron ore operations. But this is a new challenge. And for those of you who haven’t met me, let me tell you a bit more about me the sort of person I am and how I see my role as Chief Executive. I joined Rio Tinto in 1991, after 20 years in the car industry. I have spent the past eight years as chief executive of iron ore and I have worked in two other product groups, including heading the aluminum division. I am deeply familiar with this company, its strengths and its challenges and its people. And I am committed to making a real difference – building on Rio Tinto’s strong foundations to put it firmly on the path for sustainable, long term success. I personally place the highest importance on integrity, accountability, respect and teamwork. These are values that play a big role in the way I do business, and what I expect from my team.…

Thank you Jan, and you too for the trust you and the board have placed in me, to lead this company in its pursuit of greater value for our shareholders. It's a trust I feel deeply, which makes me even more conscious with the responsibility that I have taken on. I am setting a clear course, clear objectives and I am determined to deliver them. Let me first recognize my predecessor Tom Albanese, particularly for the support that he had shown me in my new role as Chief Executive. This is a great company. It's got great assets, and I inherit a great team. People that I know well from my 21 years with the company. I am confident in our core strengths and in my ability to lead the team. I am proud of my record, and the success of our iron ore operations. But this is a new challenge. And for those of you who haven’t met me, let me tell you a bit more about me the sort of person I am and how I see my role as Chief Executive. I joined Rio Tinto in 1991, after 20 years in the car industry. I have spent the past eight years as chief executive of iron ore and I have worked in two other product groups, including heading the aluminum division. I am deeply familiar with this company, its strengths and its challenges and its people. And I am committed to making a real difference – building on Rio Tinto’s strong foundations to put it firmly on the path for sustainable, long term success. I personally place the highest importance on integrity, accountability, respect and teamwork. These are values that play a big role in the way I do business, and what I expect from my team.…

Thank you, Sam. We have reported underlying earnings of $9.3 billion and cash flows from our operations of $16.5 billion. Whilst lower than last year, principally due to lower commodity prices, these results demonstrate the good performance and healthy position of our underlying business. As we flagged in January, we have recognized an impairment charge of $14.4 billion, mainly related to our Aluminum and Mozambican coal assets. The aluminum market deteriorated further in 2012, whilst the Australian and Canadian dollars remained strong. These factors, coupled with high energy and raw material costs, reduced market valuations substantially. In Mozambique, we had planned to barge coal along the Zambezi River. This has not received formal approvals, but we remain actively engaged with the Government of Mozambique on all transport options. We have revised down our estimates of recoverable coking coal, which necessitated a reassessment of the overall scale and ramp up schedule resulting in the impairment. The impairment charge has been partly reduced by a deferred tax asset of $1.1 billion, following the introduction of the MRRT in Australia last year. We recognized net gains on consolidation of Richard Bay Minerals in Turquoise Hill of around $800 million. So, overall, we recorded a net loss of $3 billion. Let’s now take a look at the key drivers of our underlying performance, starting off with price. Lower prices for most of our products resulted in a $5.3 billion drop in underlying earnings. Weaker markets were driven by two main factors – the slowdown in China and subdued growth in the rest of the world. Of course, the lower average iron ore price had the greatest impact, reducing underlying earnings by $3.7bn. It was a tale of two halves for iron ore prices in 2012. The first half of the year was relatively stable.…

Thank you, Sam. We have reported underlying earnings of $9.3 billion and cash flows from our operations of $16.5 billion. Whilst lower than last year, principally due to lower commodity prices, these results demonstrate the good performance and healthy position of our underlying business. As we flagged in January, we have recognized an impairment charge of $14.4 billion, mainly related to our Aluminum and Mozambican coal assets. The aluminum market deteriorated further in 2012, whilst the Australian and Canadian dollars remained strong. These factors, coupled with high energy and raw material costs, reduced market valuations substantially. In Mozambique, we had planned to barge coal along the Zambezi River. This has not received formal approvals, but we remain actively engaged with the Government of Mozambique on all transport options. We have revised down our estimates of recoverable coking coal, which necessitated a reassessment of the overall scale and ramp up schedule resulting in the impairment. The impairment charge has been partly reduced by a deferred tax asset of $1.1 billion, following the introduction of the MRRT in Australia last year. We recognized net gains on consolidation of Richard Bay Minerals in Turquoise Hill of around $800 million. So, overall, we recorded a net loss of $3 billion. Let’s now take a look at the key drivers of our underlying performance, starting off with price. Lower prices for most of our products resulted in a $5.3 billion drop in underlying earnings. Weaker markets were driven by two main factors – the slowdown in China and subdued growth in the rest of the world. Of course, the lower average iron ore price had the greatest impact, reducing underlying earnings by $3.7bn. It was a tale of two halves for iron ore prices in 2012. The first half of the year was relatively stable.…

Thanks very much Guy. In a number of ways 2012 was a difficult year, with the fallout from the global financial crisis still having an impact on us. But our underlying business performed well, and there are plenty of reasons to be optimistic in 2013. Let’s now take a brief look at the outlook, starting with the near term. The global economy ended 2012 in a healthier state than forecast, largely due to a better, or perhaps I should say less dire, performance in the OECD countries. This in turn reflected a shallower recession in the Euro zone, and a weak but steady recovery in the US. However, the slowdown in China did turn out to be more pronounced. This raised fears of a hard landing, and sparked a debate on the sustainability of investment-led growth in China. This in turn led to increased risk aversion towards commodities. But importantly, we did see some recovery in China at the end of the year, together with an improvement in confidence in the OECD. And we are seeing this positive momentum being sustained in 2013, with Chinese GDP expected to return to above 8% growth this year. We do, however, expect market uncertainty and price volatility to persist. Rio Tinto is a company that is always focused on the longer term. Here our view is unchanged: that over the course of the next two decades, billions of people will move from rural to urban areas, driving up consumption of the metals and minerals that we produce. Again, of course, China will be key. The Chinese population is still only around 50% urbanized. We would expect this to rise to closer to 70% towards 2030, with around 200 million additional people moving to cities in the next decade alone. But importantly it’s not…

Thanks very much Guy. In a number of ways 2012 was a difficult year, with the fallout from the global financial crisis still having an impact on us. But our underlying business performed well, and there are plenty of reasons to be optimistic in 2013. Let’s now take a brief look at the outlook, starting with the near term. The global economy ended 2012 in a healthier state than forecast, largely due to a better, or perhaps I should say less dire, performance in the OECD countries. This in turn reflected a shallower recession in the Euro zone, and a weak but steady recovery in the US. However, the slowdown in China did turn out to be more pronounced. This raised fears of a hard landing, and sparked a debate on the sustainability of investment-led growth in China. This in turn led to increased risk aversion towards commodities. But importantly, we did see some recovery in China at the end of the year, together with an improvement in confidence in the OECD. And we are seeing this positive momentum being sustained in 2013, with Chinese GDP expected to return to above 8% growth this year. We do, however, expect market uncertainty and price volatility to persist. Rio Tinto is a company that is always focused on the longer term. Here our view is unchanged: that over the course of the next two decades, billions of people will move from rural to urban areas, driving up consumption of the metals and minerals that we produce. Again, of course, China will be key. The Chinese population is still only around 50% urbanized. We would expect this to rise to closer to 70% towards 2030, with around 200 million additional people moving to cities in the next decade alone. But importantly it’s not…

Rob Clifford, Deutsche Bank. Thanks for the presentation, I have three questions. Firstly can you give some examples of some of the excesses you have seen creeping over the last seven years that you think are easy to tackle? And secondly do you feel or do you see that the board relationship with the executive team will adjust with the changes we have seen over the last couple of months? And thirdly, the changes you're talking about requires some significant cultural change from the last few years. Have you got the skills within the leadership team across the levels to deliver? And specifically the two big divisions energy and aluminum. You talked about the factors well the change is already in - but aluminum has been looking for these changes for some years. How can do they things differently to get the outcome that you require?

I've got the track record of running the largest earning business at Rio Tinto, and many of you have heard me talk about the fact that we have an operation center in the Perth Airport and that optimizes the business in real time. The fact of the matter is that the total business operates in real time making decisions being more nimble, being more focused. This is fundamental to the way that a business runs and I think as businesses get bigger they become less nimble. It's all businesses in a way, it's lucky because I have to be nimble to physically survive. What I'm intending is to overlay the approach we've taken in iron ore to the broader business. It is about cultural change, but it's nothing radical, it's nothing revolutionary. It's a way that businesses evolve and as businesses get larger, sometimes the businesses get slower in terms of how they look at information and how they respond. So are we refocusing the business to pick up? The type of culture that we operated in, in iron ore and taking at across the broader business ensuring that we're more responsive ensuring that we're nimbler in terms of the way that we look at data and the way that we analyze things, ensuring that we make well informed decisions on the basis of data that is responsively generated so that you got clean line of sight so that you can understand all of the issues that are impacting. I mentioned earlier that we're facing more volatile times, well it actually means that you need to change the way that you operate in an environment like that. These are some of the overarching changes but you know I mentioned focus, I mentioned discipline, I mentioned accountability. I mean this is…

I've got the track record of running the largest earning business at Rio Tinto, and many of you have heard me talk about the fact that we have an operation center in the Perth Airport and that optimizes the business in real time. The fact of the matter is that the total business operates in real time making decisions being more nimble, being more focused. This is fundamental to the way that a business runs and I think as businesses get bigger they become less nimble. It's all businesses in a way, it's lucky because I have to be nimble to physically survive. What I'm intending is to overlay the approach we've taken in iron ore to the broader business. It is about cultural change, but it's nothing radical, it's nothing revolutionary. It's a way that businesses evolve and as businesses get larger, sometimes the businesses get slower in terms of how they look at information and how they respond. So are we refocusing the business to pick up? The type of culture that we operated in, in iron ore and taking at across the broader business ensuring that we're more responsive ensuring that we're nimbler in terms of the way that we look at data and the way that we analyze things, ensuring that we make well informed decisions on the basis of data that is responsively generated so that you got clean line of sight so that you can understand all of the issues that are impacting. I mentioned earlier that we're facing more volatile times, well it actually means that you need to change the way that you operate in an environment like that. These are some of the overarching changes but you know I mentioned focus, I mentioned discipline, I mentioned accountability. I mean this is…

May be just two quick questions. the first of all, when do you think Rio will be in a position to stop properly considering returning cash to shareholders. In terms of what debt level do you feel comfortable with your single A rating, if investments accelerate that process, will the board consider bringing forward some cash returns. And secondly just in terms of management change, Guy was planning to retire at the end of the this year, you can revisit that plant to ensure continuity of that.

Let me start with the second question first and then Guy and in fact if I could get you to respond on the cash return to shareholders. Yes, we have announced quite some time ago the Guy will be retiring at the end of the year. he will be staying on board through 2013 and we have always indicated that the time that we bring on his successor that she/he will move into that role of course supported by Guy in terms of all the handover but that we will retain Guy experienced in expertise through the end of the year and that is very-very important to us. In relation to considering cash returns, Guy why don’t you pick up on that question?

Let me start with the second question first and then Guy and in fact if I could get you to respond on the cash return to shareholders. Yes, we have announced quite some time ago the Guy will be retiring at the end of the year. he will be staying on board through 2013 and we have always indicated that the time that we bring on his successor that she/he will move into that role of course supported by Guy in terms of all the handover but that we will retain Guy experienced in expertise through the end of the year and that is very-very important to us. In relation to considering cash returns, Guy why don’t you pick up on that question?

Thanks well (inaudible) I mean when are we going to stop probably returning cash to shareholders and I think we all return here to show right now, I mean we had a 34% increase in the dividend. Last year and here we have a 15% increase in the dividend, so that is properly return in cash to share holder but I know what you mean. You mean when we might have another buyback program. Now we have been very willing to end our buyback programs as we demonstrated in the period 2004, 05, 06 and then again more recently in the period 2011, 12 when we return $7 billion through buybacks. I think we are serious though about our single A rating. And I think that if taking into account the level of capital that we expect to spent this year, there is no immediate likelihood that we would return a cash to shareholders through buybacks. You mentioned disposals and it is true as Tom said that we are looking at further disposals than the ones that we have announced depending upon how many of those are accomplished when there accomplishment how much we get for them. I suppose it’s possible that the balance sheet could return to a point where that question became relevant but I would not encourage you to expect that this year. However we are serious as we have demonstrated in the past about the idea of returning cash to shareholders if that makes sense. And we have said by the way both today and in previous announcements that we are measuring our investments against that sort of approach so we are looking at our investments against the alternative of returning cash to shareholders. Although that's not an immediate prospect for the reasons that I have said. (Inaudible) commented that you generate shareholder value in a range of ways I mean certainly returns is part of it but delivering real value increase for the business that also is an incredibly important part of delivering this increase in shareholder value. Do you have another question here in the room?

There's a lot focus on the areas of the business where we've invested a lot of capital, but there's not much returns. But at the moment I think it's all about iron ore, can you talk a little bit more about the iron ore, the pace of ramp up in your expansion in the Pilbara, and how you see the iron ore market over the next year and perhaps 3 to 5 years? And just further to that, can you just outline given your in-depth knowledge of Simandou and IOC - can you just outline your long term vision for those two projects and where they sit?

I would comment that the business is broader than iron ore and as I mentioned in relation to Yarwun 2 coal, Oyu Tolgoi, I mean we have a range of projects that are in the portfolio. And we are diversified importantly and different parts our business go through different parts of the cycle and they have their time in the sun. In relation to iron ore I mentioned Chinese GDP growth, increase in growth to 8% this year. I mean that's an important indicator, also in January I made comments about the fact that we're expecting volatility in iron ore prices. We had seen a ramp up of prices surrounding potential weather effects in the Pilbara, in fact elsewhere in iron ore production. Also we had seen destocking, we've not seen that restocking take part at the pace that we expected. The iron ore stocks at the major Chinese ports is hovering around $70 million tones. It used to be around $95 million to $100 million. So there is restocking that's required, but we're seeing continuing investment in urbanization, we expect that will flow to industrialization sort of during that 3 to 5 year period that we met. We're also seeing in India, we have seen still capacity there come on and we've not seen commensurate increase in iron ore mining. That's been as a result of a number of factors that are relating to land access relating to infrastructure and relating to power. And these are issues that are slowing down expansion of iron ore and India has made the decision to address the clear reduce their exports of iron ore. So those things are helping produce an iron ore market that's a bit stronger. Iron ore prices are currently $115 (inaudible), will prices remain at that level. I…

Our first question comes from Clarke Wilkins of Citi. Please go ahead, your line is open.

Just a question I suppose iron ore and also just on return. When you look - you are a diversified company but at the moment the vast majority of earnings comes from iron ore and we saw a lot of volatility in the iron ore market last year. Is there anything you can do with second largest, maybe going to the biggest producer, to smooth out the volatility in terms of pricing at least etcetera or with the sort of transition thing, spot prices we basically stop with this volatility and could we expect similar episode in the second half of the year? The second question just, you talked about you know sort of credit display on investments etcetera, does that require sort of higher returns on some of the projects like Simandou to justify the investment given some of these projects get into increasingly risky countries?

Firstly Clarke on your question about volatility - because I think the entire industry would prefer a scenario where we had reduced volatility but the old days are passed. We won't see a return to annual prices and quite frankly both customers and iron ore producers are moving to even more frequent pricing reviews, whether it be monthly or in fact daily. This is no different to what we see with other traded commodities, no different to aluminum and copper. It reflects to an extent, the vagaries of whether that I've just mentioned, it reflects seasonal factors, it reflects holiday seasons, it reflects a whole raft of issues. But we need to sit back and we need to look at overall at the trends that we see with iron ore. And importantly this urbanization, industrialization that I talked about is going to continue, certainly in China, but then we'll see the benefit of this slowing forward in terms of India, Indonesia, Vietnam, Philippines, Thailand, Malaysia. We're seeing it in South America, we're seeing it in Eastern Europe and if I want to really stretch your imagination it'll happen in Africa too, we're seeing growth there and we'll see a time there are actually more people than they are in China, there is already a billion people in Africa. All of these are building blocks, the building blocks of developing economies and we are fortunate to be in a position where we are providing the fundamental to provide these buildings blocks. I think in relation to the right of return for projects, as Guy mentioned we fit our (inaudible) capital last year, just over $17 billion of capital this year from the charts, it saying that we are projecting 13, there are some unapproved projects there that (inaudible) some of the growth but that depends on the market, it depends on a range of factors but we have seen the peak. Now, importantly if you forward, ensuring that we invest in the projects that are well above the rate of return, well above an highly competitive all of the turn, this is physical important to us and that’s the way that will evaluate projects. I should also mention that we have revised the way, that systems operating into projects review, we are reinforcing the disciplines in our decision making there to ensure that we are making the best decisions. Ensuring that we have got rigorous analysis ensuring that we review the sensitivities that you would expect that ensuring that it’s very rigorous to (inaudible) as these projects go forward. This will ensure that the projects are actually get to be reviewed by the investment committee and the board, the projects with the highest rate of return. So that’s another question from the front line.

Our next question comes from the line of Lyndon Fagan of JPMorgan. Please go ahead.

Sam, a lot of the issues that you have talked about trying to resolve the product M&I, I am just wondering if you all prepared to rule out for the M&I for the foreseeable future that was the first question, and then in terms of (inaudible) I guess you are talking about an underground that could cost up $5 billion. I am just wondering if you have sufficient confidence in geopolitical situation at the moment to actually we're going ahead with that project, thanks. Okay firstly in relation to M&A I sure will indicate to you that I am not spending anytime looking at that potential acquisition. I have learnt in my career you can never say never but it’s not on my writer screen. My writer screen is focusing on delivering the projects that we have got on the pipeline ensuring that future investments in our organic growth are the best possible projects ensuring we delivering on commitments in relation to cost improvement productivity improvement, the way that we are physically operating our business. As I said, the foundation (inaudible) is a great company. These are fundamental things in relation to how our business should be operated. In relation to (IT) I have mentioned that the Phase 1 of that project has gone very well and I think Andrew and his teams have done a great job there in terms of bringing that project on. First concentrated in January respecting that Phase 1 will be up on operating in the first half of this year. In relation to Phase 2, we are going through the normal process that we go through in relation to a project as we move from prefeasibility into feasibility in terms of the value analysis and value engineering that we take to ensure that we…

Our next question comes from Peter O'Connor of Merrill Lynch. Please go ahead sir.

Two questions - Pacific Aluminum, can you give some update about the mechanisms that you're looking at to divest or move that asset and what timeframe we should expect? Secondly, I'm mindful that when you used words, you used them very carefully - you're significant in your release regarding asset filed this year. How do I understand the term significant, is that 1 to 5, doing five, doing or more. How do I read that? And lastly with regards to the Australian political landscape and doing business in Australia, how are you seeing that evolve this year given recent political channel potential political changes and particularly with your comments about MRRT etcetera. How do you feel landscape going forward?

Perhaps if I move backwards through those three questions. Peter, thank you very much for your congratulations. If I can move backwards through those three questions and guy if I could signal to you that I'd like you to cover the issue of (inaudible). Look I was trying political landscape, are in politics is politics and you know I think a week a long time in politics. Well seven months is an even longer time and we have seen the crawling of election for September 14. I'm not sure that will see a lot of joy rations between now and September 14. Importantly we work with governments all around the world and we respect the government, we got a good relationship. Like if I would have actually just focus on the Gove refinery just for a moment, I think the support that we have seen from the federal government and the northern territory government in relation to those negotiations. I think it's been first class, I mean clearly a very complex and difficult issue for both governments in terms of taking forward and clearly for us. Moving to a more competitive source of energy for that refinery, absolutely essential. Yes we did take a tough stance in relation to that and yes if we didn’t get gas we would have in fact multiplied that plant, but through a process of very healthy engagement working with both governments we've moved to a situation where not only for the people of Nhulunbuy and the Northern Territory in Australia but also for Rio Tinto, we've got the best possible outcome. We'll have an asset of Pac-Al that is an integrated aluminum business - bauxite, alumina and aluminum, that's important to maximize the value of the sale, but importantly the gas will enable us…

Thanks Guy and thank Peter for your question Let's move back to the room in London and we've got a question over here.

Coming back on the cultural change Sam, the financial industry has gone for a very similar process in the last three years, and the only thing that seem to work is a change in incentive and a change in discount rates and cost of equity. Are you implementing things like that in the company, changing management incentives, changing discount rates, are you increasing discount rates on projects to accelerate this cultural change. And secondly on the volume side, volumes are clearly a negative contributor to the business this year. There is clearly a bit of a tension there between depletion and negative volumes and on the other hand capital discipline actually the business wants to grow, therefore more eager to approve new projects. On the other hand you want to just slow down and only go for the best. How do you deal with that? Thank you.

I think in relation to your first question about incentives and discount rates, certainly in terms of our establishment of short and long term incentives for the business is something that we give a lot of thought to. We are considering some changes in relation to how that operates, it's not totally reinventing it, but insuring that it relates to the sort of focus that I've been talking about here, reflecting the priorities of the business, particularly in relation to cost reduction and to focus there. In relation to discount rates, I mean something that we continue to evaluate and it something that’s important in terms of how we look at projects but equally so the assumptions that we have in relation to forward commodity processing and exchange rates that’s equally important and the sensitivities that we put through projects ensuring that they reflect realistically the potential outcomes that you could have in the projects could phase. And rather and taking sort of stock standard sensitivities, looking at the cases that could actually represent movements we are seeking in relation to various inputs and outputs for the projects. Volumes are important to have business, they are important to any business but giving the tradeoff run between value and volume, is an important issue and importantly on focusing on every part of that business in relation to how they contributing to our earnings and how they are contributing to our cash generation. The business is seeing an increase focus on granularity in terms of how we are physically operating and we (inaudible) is not being generated. I mentioned before the volatility and I agree that if the (inaudible) less volatile, that will be wonderful thing but unfortunately I don’t drive that but it is important that as we move the business forward, the nimbleness and the responsive (inaudible) that have talked about that were affecting that in terms of how we are physically running the business. Annual plans and annual reviews are an important, they provide the foundation (inaudible) operating. But if the circumstances change then you need to physically respond to those and it is not adequate to say well in October last year, that this what we have planned but the rules changed completely in the meantime. It can be by the way, it can be positive changes or in fact it can be negative changes and you need to take stock and you need to take advantage of both. So we are not an organization as committed to volume for volume sake. We are an organization as committed to value and we are committed to delivering shareholder value and that needs to take into account, the very trades of that I have been talking about in terms of many moving parts in terms of the world economy and that effects on different commodities and different ways. Perhaps another question here in the room we have a gentleman here who has been very patient.

I think in relation to your first question about incentives and discount rates, certainly in terms of our establishment of short and long term incentives for the business is something that we give a lot of thought to. We are considering some changes in relation to how that operates, it's not totally reinventing it, but insuring that it relates to the sort of focus that I've been talking about here, reflecting the priorities of the business, particularly in relation to cost reduction and to focus there. In relation to discount rates, I mean something that we continue to evaluate and it something that’s important in terms of how we look at projects but equally so the assumptions that we have in relation to forward commodity processing and exchange rates that’s equally important and the sensitivities that we put through projects ensuring that they reflect realistically the potential outcomes that you could have in the projects could phase. And rather and taking sort of stock standard sensitivities, looking at the cases that could actually represent movements we are seeking in relation to various inputs and outputs for the projects. Volumes are important to have business, they are important to any business but giving the tradeoff run between value and volume, is an important issue and importantly on focusing on every part of that business in relation to how they contributing to our earnings and how they are contributing to our cash generation. The business is seeing an increase focus on granularity in terms of how we are physically operating and we (inaudible) is not being generated. I mentioned before the volatility and I agree that if the (inaudible) less volatile, that will be wonderful thing but unfortunately I don’t drive that but it is important that as we move the business forward, the nimbleness and the responsive (inaudible) that have talked about that were affecting that in terms of how we are physically running the business. Annual plans and annual reviews are an important, they provide the foundation (inaudible) operating. But if the circumstances change then you need to physically respond to those and it is not adequate to say well in October last year, that this what we have planned but the rules changed completely in the meantime. It can be by the way, it can be positive changes or in fact it can be negative changes and you need to take stock and you need to take advantage of both. So we are not an organization as committed to volume for volume sake. We are an organization as committed to value and we are committed to delivering shareholder value and that needs to take into account, the very trades of that I have been talking about in terms of many moving parts in terms of the world economy and that effects on different commodities and different ways. Perhaps another question here in the room we have a gentleman here who has been very patient.

It's (Frazier Jameson) from JP Morgan, really a question around the cost saving targets and first part of which is could you just confirm that $5 billion number is not reliant on disposals to be reached? The second part, could you just remind us about the existing targets that are already fitting into that, I think we've got $1.6 billion of EBITDA improvement in aluminum of which both 50% is cost related. Could you just remind us what else is in there and then the third part is just drawing Guy's comments on an absolute and productivity driven cost. If we look at the pie chart, is it reasonable to say aluminum and energy divisions not growing nor schedule to grow much over the next couple of years therefore we should think of those cost savings in absolute terrains and the central cause whereas iron ore and copper obviously you are going to get the benefit of higher volumes so therefore they are more productivity and fixed cost leverage related.

Guy sort of gave us certainly a field during his presentation of what was in and what was out. But I think we need to clarify the point you rose, let me assure you disposals are not included in cost reductions but I think in relation to the existing targets and the pie chart Guy could you pick that up for me?

Yes, I mean I think we are trying to make high quality sustainable cost reductions here so if we make a disposal which we may to, as we've discussed just now. It will have to be deducted from both the starting point and the end point so we will have to make an adjustment for that. I have given all the conditions that apply to this but to try and answer your questions about existing target, we have existing targets that relate to aluminum as you've said. Actually the $1.6 billion of improvement in EBITDA came from multiple sources. So for example it came from a revenue enhancement through various means of the creep of capacity through getting hard premiums from things of that sort. We have also deferment or more efficient use of capital, we have improvements in working capital as well as cost savings. And so what we've done is subsume the cost savings that were in the $1.6 billion within the $5 billion. But the other improvements, the ones that I've just tried to describe are still underway and being pursued by written to aluminum. On the question of absolute and productivity driven cost, I think that the characterization that you have described is approximately right. I mean we do have the benefits of volume and because this is fundamentally based on a unit cost approach, we have the benefits of volume in those two iron ore and copper divisions as you say. That will depart of the contribution that's being made by those. Also as you say aluminum and energy aren’t really expanding and we're having to look elsewhere. I gave some instances of it, but to give a little bit more color to this we're looking very hard for example at procurement. Can we achieve…

Thanks very much Guy, I was just been handed a wind up note. So perhaps if I could just take one quick question from the phone and then I'll need to make the hard close of 10:00.

Thanks very much Guy, I was just been handed a wind up note. So perhaps if I could just take one quick question from the phone and then I'll need to make the hard close of 10:00.

Our next question comes from Glyn Lawcock of UBS. Please go ahead.

Good morning Sam. Just wanted to check two things, I'll question you on two issues. Firstly you said government have been stepping in and they're barrier to rebalancing the industry, I think that was your quote. And then you went onto say, we've accepted the government's handout to keep Gove open. I'm just trying to understand how do you justify those two comments, because I think counter ensured it to each other that you've said the industry won't rebalance if we take handouts and you have. And then secondly, just to understand the mineral sands cuts that you've announced today. If you had any feel for - is that just for a year or do you haven’t really thought through this about it. Thanks very much.

Thanks very much Glyn. Look in relation to Gove, there is no government handout. This is physically the government in their own territory making available gas, there is no cost to them. In fact I've got take or pay obligations that will be removed. So there's actually a benefit to the northern territory there, but there are no handouts by government. In relation to mineral sands, that relates to the market dynamics, if it relates to where we currently see processing for industrial minerals is part of what I described in terms of all being responsive to market forces. I think with that if I could thank everybody for your questions, I think we've covered the field pretty well. I certainly look forward to spending more time speaking to investors over the course of the next few days, weeks and months. Today I have set out how I intend to deliver the strategy and my priorities for the year ahead. But if I leave you with just one impression today, just one important message today, I want it to be that I am single-minded, that I am determined to deliver greater value to shareholders. This is what drives me, this is what makes me tick. This is what gives me great satisfaction. This commitment will inform all of my decisions and the actions that we take across the business. Thank you all for being here, thank you for those on the phone line. Thank you very much.