RIO Tinto Group, fighting a US$142-billion hostile offer from BHP Billiton Ltd, yesterday posted first-half profit that beat analyst estimates on increased aluminum sales and record iron ore prices.

    Net income rose to US$6.91 billion, from US$3.25 billion a year earlier, London-based Rio said in a statement. Underlying earnings climbed to US$5.47 billion, exceeding the US$5.15 billion median estimate of six analysts surveyed by Bloomberg News. The interim dividend was increased 31 percent to 68 cents a share.

    Chief Executive Officer Tom Albanese, who rejected BHP's sweetened bid in February as too low, said Rio is better able to expand its output of commodities independently. BHP, based in Melbourne, last week posted a 30-percent gain in fiscal second-half profit after producing record quantities of crude oil, iron ore and coal.

    "It might appear that Rio, with its results slightly ahead of market estimates, has done better than BHP," Rob Craigie, a senior analyst at FW Holst & Co in Melbourne, said yesterday. "That position could easily change in the December half."Albanese, 51, plans to spend US$6 billion this year to boost output of commodities. BHP made its initial proposal in November, the same month Rio paid US$38.1 billion for Canada's Alcan Inc. That deal made Rio the second-largest aluminum producer, boosting its second-quarter output of the lightweight metal almost five-fold.

    Rio is also the world's second-largest iron ore producer, and it said last month that second-quarter output of the steel-making raw material rose 13 percent to a record 41.9 million metric tons.

    "Although we have seen some moderation in growth rates in developed countries, the impact on our markets has been modest due to continued strong growth in developing countries," Chairman Paul Skinner said yesterday in a conference call from London. Both Rio and BHP agreed to contract-price increases for iron ore of as much as 97 percent from April 1.

    Prices have risen fivefold since 2001, driven by expanding demand in China and other emerging economies.