Iluka Swings to Annual Loss on Lower Sales, Charges

Feb. 25, 2010
Iluka Resources Ltd., the world's biggest zircon producer, swung to a full-year loss after a decline in demand cut sales and forced the company to write down the value of deposits and close mines.
The net loss was A$108.6 million ($97 million), or 26.8 cents a share, for the 12 months ended Dec. 31, compared with net income of A$77.5 million, or 22.4 cents, a year earlier, the Perth-based company said in a statement to the Australian stock exchange. Sales declined 37 percent to A$586 million.
The global financial crisis forced Iluka to idle half its production in Western Australia and cut its workforce there by a third. The company said it expects to report a loss for this half on higher costs amid uncertain economic conditions.
"Management recognizes that potential risks to Iluka's financial performance and balance sheet continue in the short term given that many global economies remain fragile," Managing Director David Robb said in the statement.
The company took a A$67.6 million non-cash charge before tax for writing off the value of some deposits and A$57.8 million for the mine closures and restructuring, according to the statement.