27th Jan 2020 08:29
(Alliance News) - Petra Diamonds Ltd on Monday said a fall in diamond prices offset increased production in the first half of its financial year.
Petra shares were 9.1% lower on Monday in London in early trade at 9.73 pence each.
For the six months to December, Petra produced 2.1 million carats, a rise of 3% on the year before. It is on track for full-year guidance of approximately 3.8 million carats.
However, the firm's revenue fell 6% to USD193.9 million, mainly due to lower prices and, as previously reported, an adverse product mix from the Finsch and Williamson mines. This was slightly offset, Petra said, by the "exceptional" blue diamond found at Cullinan.
The 20-carat stone was sold in November for USD15 million, having been found in September from South Africa's Cullinan mine.
Petra did say prices stabilised in the second quarter of its year, and it believes demand will continue to improve.
Net debt as of December 31 was USD596.4 million, broadly flat from the figure at September.
Chief Executive Richard Duffy commented: "I am very pleased with the progress made in implementing Project 2022 across our operations and at the corporate level. The buy-in to this project from all of our Petra employees and contractors has supported the strong operational performance across all sites, resulting in us achieving our highest level of run-of-mine tonnes mined and carats recovered over the last six months, and has positioned us to meet or exceed full-year guidance.
"It is also encouraging that rough diamond pricing has modestly improved moving into our third quarter. The health of the market will depend on continued supply discipline from the majors as well as macro-economic conditions."
By George Collard; [email protected]
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