PERTH (miningweekly.com) – Mineral sands miner Iluka has seen revenues and profits decline in the six months ending June, as sales volumes for the interim period were impacted by the Covid-19 pandemic.
“Iluka has reported a solid first-half result given the impact of Covid-19 on zircon and titanium markets, and the global economy broadly. Given the volatility experienced throughout the world over recent months, we’re pleased with the earnings and cash position we’ve delivered,” said MD Tom O’Leary.
Sales revenue for the interim period declined by 16.3% on the previous corresponding period, from A$545.6-million to A$456.6-million, while net profits after tax declined from A$137.2-million to A$113.2-million.
Total zircon/rutile/synthetic rutile sales volumes declined by 20% in the period under review, to 242 000 t, reflecting the impact of Covid-19 on demand in zircon markets, as well as lower-than-expected sales to contracted customers for synthetic rutile.
Iluka told shareholders that the sales price for zircon also recorded some erosion from 2019 levels, while rutile prices increased by 7% from the second half of 2019, reflecting ongoing contractual arrangements.
Underlying earnings before interest, taxes, depreciation and amortisation reached A$177.1-million, down from the A$232.7-million reported in the first half of 2019.
O’Leary told shareholders that the company had made a number of operational changes in the first half of the year in response to the uncertain market conditions, including altering plant settings at the Narngulu mineral separation plant and a return to mining at Jacinth from Ambrosia, with the move occurring at the end of July and mining at Jacinth starting on August 1.
“These changes are enabling us to reduce costs in an efficient manner to preserve cash and maintain a strong balance sheet,” he added.
“We will continue to closely monitor the dynamic market conditions we’re currently operating in and manage our operational response accordingly.”