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Iluka flags up to A$230M loss for FY'16

Iluka Resources Ltd. expects to book a net loss after tax of between A$220 million and A$230 million for 2016, following a review of its business.

Contributing to the loss is a pretax, noncash impairment of A$201 million and an increase in rehabilitation provisions of A$45 million, related mainly to closed U.S. operations, according to a Jan. 30 statement.

Meanwhile, December-quarter mineral sands production slipped to 205,400 tonnes from 364,200 tonnes in the same quarter of 2015.

During the quarter, the only mining operation being conducted was at Tutunup South, part of the Perth Basin operation in Western Australia. Iluka suspended mining and concentrating activities at Jacinth-Ambrosia, part of the Eucla Basin operation in South Australia, in April 2016 to draw down concentrate inventory.

Production was suspended at the Narngulu mineral separation plant in Western Australia in October 2016, while the Hamilton mineral separation plant, part of the Murray Basin operation in New South Wales, Australia, was idled for about two weeks over the Christmas period.

Both plants re-commenced production in January.

Total mineral sands production for 2016 declined to 992,900 tonnes from 1.2 million tonnes in the previous year.

Iluka said it produced 666,700 tonnes of zircon, rutile and synthetic rutile for the year, which was above its guidance of 660,000 tonnes. By comparison, the company produced 690,000 tonnes of zircon, rutile and synthetic rutile in 2015.

Total mineral sands revenue for the December quarter slipped to A$235.9 million from A$284.2 million a year earlier and for the full year fell to A$708.5 million from A$819.8 million in 2015.

Iluka attributed the lower revenue to higher internal usage of ilmenite for synthetic rutile production and lower sales of the remaining ilmenite from the Virginia operations that were idled in December 2015.

Total mineral sands sales for the year dropped 26.7% year over year to 697,300 tonnes.