Petra Diamonds’ H1 Revenue Up 16%

(IDEX Online News) – Petra Diamonds Limited reported that production for the first six months of its financial 2015 year was down 2 percent compared to same half-year period a year ago. Production decreased to 1.601 million carats from 1.635 million carats a year earlier.

Revenue was up 16 percent year over year to $214.8 million. Results include sales proceeds from two exceptional diamonds for combined revenue of $38.7 million. Petra’s net profit for the six-month period totalled $39.1 million, up 38 percent year over year.

Carats sold during the first half of financial 2015 were down 1 percent to 1.402 million carats. Carat sales were lower than carats produced due to the seasonal timing of Petra’s tenders. The company held three tenders in the period, equating to five months’ production, and will hold four tenders in the second half of the financial year, equating to seven months’ production.

“Petra has achieved strong first half results, further to the continued delivery of our growth strategy. Our expansion programmes are on track at all operations, and production is expected to grow to ca. 3.3 million carats for FY 2015 and to ca. 5 million carats by FY 2019,” said Petra CEO Johan Dippenaar.

Petra noted that while the rough diamond market exhibited its customary post summer softness during the first half of financial 2015, further pressure on prices was evident due to some short-term indigestion in the pipeline caused by issues relating to liquidity, polished inventory levels and the impact of the strong US dollar on US dollar-denominated diamond prices. Petra estimates that diamond prices achieved by the company on a like for like basis were down on average by 8-9 percent for the period.

Added Dippenaar: “While the diamond market remains under pressure, there are encouraging signs that we are seeing a stabilization in market conditions, as evidenced by good demand levels at our first tender in H2 FY 2015. Our continued growth trajectory and robust financial position places Petra in a good position to capitalise on the attractive medium- to long-term fundamentals for our industry.”

Petra’s first tender in the second half of financial 2015 saw “good levels of interest and slightly firmer market conditions,” according to the firm. “If this steady activity continues in the pipeline in the months to come,” said the company, it “expects firmer pricing towards the end of the second half of financial 2015.”