Petra H1 Production Up 64% to 954K Carats

Johan Dippenaar

Production leapt 64 percent to 953,553 carats; a substantial rise compared to the 582,102 carats mined in the first half of 2011, Petra stated this morning (Tuesday) in an interim report for the six months ended December 31, 2011.

Revenue was up 13 percent over the prior year period to $101.4 million.

The company’s profit from mining activity rose 25 percent to $30.7 million, versus $24.5 million in the first half of 2011. Petra said this reflected the introduction of the Finsch diamond mine into the group on September 14, 2011 and the continuing improvement of the mines' performance, which were significantly mitigated by the weaker diamond prices in the period.

Despite the good results, the company posted a loss after taxes of $26.7 million compared to a $24.5 million profit in the first half of 2011. This was due to unrealized foreign exchange losses of $35.7 million, of which about $16 million have reversed since the period ended due to the strengthening of the Rand.

In its outlook, the company said both production and sales are expected to be substantially higher in the second half of the year due to a full six months' contribution from Finsch and the release of unusually high group closing first half inventory into second half sales.

"The first half of the year saw Petra consolidate its position as one of the world's largest quoted diamond miners, with the completion of the acquisition of the Finsch mine, as well as the successful move from AIM to the Main Market of the London Stock Exchange,” said CEO Johan Dippenaar. “The second half of our 2012 financial year will see significantly higher production and sales, set against a more stable diamond market. We remain on target to deliver on our stated growth strategy."

Petra Diamonds has interests in eight producing mines: seven in South Africa (Finsch, Cullinan, Koffiefontein, Kimberley Underground, Helam, Sedibeng and Star) and one in Tanzania (Williamson).