Iluka Resources is confident of a recovery in the mineral sands industry this year but it won't come quickly enough to save 200 jobs it has decided to axe.
A synthetic rutile kiln in south-west Western Australia Would be shut down for now, the idling of another WA kiln would be extended and rosters would be reduced in Victoria and the US, managing director David Robb said.
"We have been in something of a defensive mode in the second half of 2012 particularly, extending caution in 2013.
"It's about cutting production we believe for all kinds of reasons is the right thing to do."
The bulk of the workers to lose their jobs will be in WA and Victoria and come because the company slashed production by half to 811,000 tonnes to prop up prices amid plunging demand last year.
Sales fell further, down 52.9 per cent to only 488,900 tonnes.
Iluka's products, including zircon and rutile are used in ceramics and paint pigments whose demand is linked to China and other emerging economies, as well as a range of other products such as nuclear reactors.
Iluka on Thursday also reported that net profit fell 33 per cent to $363.2 million in 2012 - from a record $541.8 million the previous year.
In 2013, production will be slashed by half again to 420,000 tonnes, representing a little over a quarter of the 1.63 million tonnes produced in 2011.
Last month, Iluka cut 65 jobs at its Eneabba operations in mid-west Western Australia.
Mr Robb said he felt more optimistic than a year ago that a turning point in the current low cycle of minerals sands price was near, with ceramics demand following urbanisation but he was not sure when in 2013 that would happen.
He rejected the suggestion that Iluka and other producers such as Rio Tinto had made mistakes through the volatile period of record high prices proceeding last year's dramatic slump.
However he conceded he had learnt some useful things about how the mineral sands industry works.
"The industry entered unchartered waters with product price levels not seen before," he told AAP.
"There are things that are unknown about things like costs to pass through and what the industry can sustain.
"Most people were more bullish about Europe than proved to be the case, most people thought the Chinese crackdown on property speculation would be relatively shortlived, which proved not to be and the US recovery proceeded in short fits and starts."
Iluka slashed its fully franked final dividend to 10 cents a share from 55 cents.
The company's royalty from its lucrative stake in BHP Billiton's Area C iron ore contributed $72.3 million to earnings before interest and taxation, with Mr Robb hinting at one day leveraging it into a bigger royalties business.
Total cash production costs would be cut to about $375 million from $583 million through idling operations, reducing employment levels and other actions.
Iluka's shares closed 1.45 per cent, or 15 cents, down at $10.20.