Yesterday saw Iluka (ILU) smacked -11.27%, the most since March 2020, following weak production amid softer demand for mineral sands sending the shares down to new 1 year lows. They announced a $203.8mn net profit which was in-line but the dividend was lower than consensus plus importantly guidance was poor. The company announced that they will pause some production of synthetic rutile, used in the likes of paints, for 4 months as the uncertain global economic outlook weighs on demand, potentially a prudent move but it is unlikely the stock will rally until the news flow improves.
- We exited ILU ~$11.70 in June but currently don’t see a catalyst to consider re-entering at this stage.
MM is neutral ILU around $8.30
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