Rio Tinto reported a 55% jump in underlying earnings in the first half of the year on Thuesday and reiterated its rejection of a hostile takeover from BHP-Billiton,claiming it undervalued the company.

Soaring commodity prices helped the global miner report record earnings of $5.47 billion for the six months to 30 June.

The demand driver for its products was"urbansation and industrialisation in heavily populated countries like China and India,and these economies continue to grow strongly",said Rio Tinto chairman Paul Skinner.

"While the equity markets are currently focused on downside risks,we believe there are potential offsets on the upside based on continued strength in commodity demand,low inventory levels and a supply side which continues to face multiple constaints",he said.

Rio Tinto said it was on track to divest $10 billion in assets this year to help pay-down debt after its 438.1bn Alcan purchase.

Greetings,

Inca.