Iluka up on positive outlook
UPDATE 2.20pm: Shares in Iluka Resources jumped after the company gave a more positive outlook at its annual general meeting in Perth this morning.
The mineral sands miner said production and sales guidance were in line with previous guidance.
It said total zircon/rutile/synthetic rutile sales in 2014 were expected to exceed production and be above 2013 sales of 580,000 tonnes.
Iluka said other elements of guidance, such as cash and non-cash costs and capital expenditure, were trending at, or better than, guidance numbers.
Managing director David Robb said Iluka maintained a very favourable view on medium to longer term demand for zircon, underpinned by the global forces of urbanisation; the rise of consumer-led growth in emerging markets and new uses for zircon sand and its derivatives.
"It is evident that more favourable demand dynamics are emerging in the pigment sector (the major end use sector for titanium dioxide) which, if sustained, should lead to improved sales opportunities for both rutile and synthetic rutile," he said.
"In the near term, this does, however, remain dependent on paint and pigment demand over the northern hemisphere summer season."
"High grade titanium dioxide feedstock price erosion, as the company commented upon at the time of the March quarterly production report has moderated, with current indications that prices may have found a floor."
Iluka's strategy for responding to lower demand and prices for its products in recent times has been to curb production and preserve margins rather than chase volumes.
The company says it remains ready to rapidly increase production if and when stronger demand for its products returns.
Iluka shares were up 52 cents, or 6.08 per cent, to $9.08 at the close.
