We maintain our AUD 48 per share fair value estimate for no-moat-rated Rio Tinto. First-half 2018 adjusted net profit after tax of USD 4.4 billion was 5% higher than a year ago but slightly below our expectations. Adjusted EBITDA increased 1.7% to USD 9.2 billion, with the contribution from copper and diamonds up 76% to USD 1.4 billion on stronger prices and volumes. This outweighed the headwind from energy and minerals, where EBITDA fell 28% to USD 1.0 billion, mainly due to the loss of earnings from Coal and Allied, sold in the second half of 2017, and the strike at Iron Ore Company of Canada. Pilbara iron ore EBITDA was flat at USD 5.7 billion, with increased volumes offsetting lower prices, while aluminium increased 10% to USD 1.8 billion with higher prices and volumes, partly offset by higher costs. Inflation pressure continued to build, particularly in the aluminium operations, where the price of key inputs rose materially. Higher costs offset about 70% of the benefit from higher prices in the aluminium division. Returns to shareholders were a feature of the result. Rio Tinto declared a first-half dividend of USD 1.27 per share fully franked, up 15% from USD 1.10 per share a year ago. This was in line with the 15% increase in adjusted earnings per share to USD 2.52, with the payout ratio steady at 50%. The company will buy back a further USD 1 billion of shares. The share repurchases are relatively expensive, being in a period of relatively high commodity prices and earnings. However, the additional buyback is relatively small, representing less than 1% of issued capital. This means the potential value destruction is not material to our fair value estimate. Rio Tinto plans to return a further USD 4.0 billion in aftertax proceeds from asset sales in the second half, but the form of returns is yet to be decided. We favour a greater proportion of earnings being returned to shareholders but question the merit of procyclical buybacks.