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Iluka posts stellar results as demand rises

Time:Fri, 25 Feb 2022 07:06:08 +0800

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Mineral sands miner Iluka has reported an increase in revenue and net profits after tax for the 2021 financial year, on the back of increased demand.

 

Mineral sands revenue for the full year ending December was up 57% on 2020, to $1.4-billion, while underlying net profits after tax increased by 108%, from $151-million to $315-million.

 

Mineral sands earnings before interest, taxes, depreciation and amortisation (Ebitda) for the full year were up 85%, from $342-million to $634-million, while group Ebitda was up 54%, from $423-million to $652-million.

 

Iluka on Thursday told shareholders that the results in 2021 were underpinned by strong operating performance, increasing demand and observable supply-side challenges across the mineral sands industry.

 

MD and CEO Tom O’Leary said during a conference call that the financial year had highlighted the company’s flexibility, and demonstrated Iluka’s ability to respond to market conditions.

 

In Australia, we returned to maximum operational settings in April with both the Narngulu mineral separation plant and Synthetic Rutile Kiln 2 at Capel running at full capacity.

 

In Sierra Leone last month, we withdrew our notice to suspend operations on the back of improved production performance delivered over the second half and parliamentary ratification of amendments to Sierra’s Rutile’s fiscal regime,” O’Leary said.

 

The team has been resilient in the face of the threat of ongoing disruptions presented by the pandemic and while we can expect that resilience to be further tested over the coming year, particularly in Western Australia, we do so with some confidence given our achievements today.”

 

O’Leary noted that Iluka’s performance in 2021 included significant progress on its project pipeline, with the projects being core in delivering the company’s response to the challenge of declining industry production both in the nearer and longer term and across Iluka’s products suite of zircon, high-grade titanium feedstock and rare earths.

 

Last year, we took decisions to restart Synthetic Rutile Kiln 1 at Capel, which will be on the line at the end of the year, commenced a definitive feasibility study for Balranald in New South Wales and announced a resource estimate for Wimmera in Victoria. The latter two decisions reflect our sustained focus on mineral sands technical development in Australian jurisdiction, with each of these projects and their technologies having the potential to transform our industry,” he added.

 

In its rare earths business, Iluka made its final shipment of Eneabba Phase 1 material in December, completing its sales obligations under this initial phase. Construction is well advanced for Phase 2 and, despite supply chain challenges, the company remains on track for completion in the first half of 2022.

 

Iluka’s feasibility study for Phase 3, a fully integrated rare earths refinery, has been undertaken in parallel and will be finalised in the first quarter of 2022. The key environmental approvals have been received and discussions with the Australian government in relation to risk-sharing arrangements are ongoing.

 

Iluka is positioned to lead in the response to industry and market conditions both near and longer term through our operations development pipeline, financial strength, marketing approach and products suite and this was demonstrated, I think, by the excellent results we achieved in 2021,” said O’Leary.

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