Interesting article in the Weekend Australian with Iluka Resources managing director David Robb.
That the strategy paid off is reflected in Iluka's best-in-class 40 per cent-plus return on equity and its early planning to begin a new round of growth, having rewarded shareholders with one of the biggest dividends in the resources industry, if not the biggest. The growth will not necessarily be in mineral sands alone.
"I think we are in a position now where we have free cashflows strong enough and robust enough to think more seriously about where growth might come from," Robb says.
"Within mineral sands we have plenty of opportunities in our own back yard and the focus there is definitely on projects to expand our production.
"But we have always looked at opportunities within our industry and outside. We try and develop financial models of anything we can see as to how its economics look. But it is fair to say in the past that was window shopping as we had plenty on our plate. But it was good practice. Now we can put that practice to use to the benefit of our shareholders."
Don't expect anything convoluted from Robb. "If I can't explain to our shareholders in a soundbite why an acquisition makes sense for us, and what skills we are bringing to the table other than just money, then I would have second thoughts about it. And we won't be rushed."
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