Iluka's mineral sands production falls in Q2

Resources company reduces output to cut costs, YTD revenue tumbles.

Iluka Resources Ltd's mineral sands production fell in the June quarter as the group moves to curtail output in response to lower demand.

In the three months to June 30, Iluka produced 300.2 kt of mineral sands, a 23.7% decline on the 393.7 kt in the previous corresponding period.

Year-to-date Iluka produced 572 kt of mineral sands, a 29.1% decline on the 806.7 kt produced in the previous corresponding period.

In a statement to the Australian Securities Exchange, the company repeated its aim to reduce total operating costs and draw down finished goods inventory (see Tim Treadgold's Resource stocks fall in commodities price gap).

Iluka said its revenue from its mineral and sands operations dropped 42% in the first half of 2013.

Revenue for the six months to June 30 was $382 million, down from $663 million for the previous six month period.

Excluding ilmenite, its total production of zircon, rutile and synthetic rutile was 127.2 kt in the quarter, 43.9% lower than the June 2012 quarter.

For the June half, cash costs of production were $201.9 million, or $848 per tonne of zircon, rutile and synthetic rutile produced.

The Australian dollar was buying 99.2 US cents on average in the quarter, down from 103.9 cents in the March quarter, the group said.

"The majority of Iluka's revenue is denominated in US dollars and as a result a lower Australian/US dollar exchange rate is favourable for revenues translated into reporting currency," the company said.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles