Petra Diamonds FY2015 Revenue Down 10%

(IDEX Online News) – Petra Diamonds Limited has announced that its revenue for the year ended June 30 2015 dropped 10 percent to $425 million, compared to $471.8 million in 2014.

Petra said its results were negatively impacted by underground production being reliant on mature, diluted mining areas, as well as the weaker diamond market. However, it noted that the full year results were partially offset by the favorable impact of the weakening in the rand.

The company’s net profit after tax was down 33 percent to $62.8 million compared to 2014’s result of $93.7 million.

Production was up 2 percent to 3.2 Mcts (3.1 Mcts in 2014) and operating costs were well controlled.

Gross Diamond Resources (inclusive of reserves) increased 2.5 percent to 308.7 Mcts (30 June 2014: 301.1 Mcts).

In its outlook for 2016, Petra said expected production of 3.3-3.4 Mcts, an increase of 3-6 percent over 2015. Part of the expected increase is due to the processing of undiluted ore from new mining areas.

“As already reported, FY 2015 was a challenging period, both operationally, due to the reliance of our underground mines on the mature, diluted mining areas, and also in terms of the softer diamond market, which saw lower pricing for the year,” said CEO Johan Dippenaar.

“However, the group still recorded a number of important achievements, with increased tonnage throughput for the year, the continued delivery of our mine expansion projects, the strengthening of our balance sheet, due to the $300 million notes issue and increase in bank facilities, and the commencement of construction of a modern processing plant at Cullinan post year end in Q1 FY 2016.”

Dippenaar said that while market conditions remain subdued in the short term, Petra is in a robust position as it starts to access the new, undiluted mining areas at Finsch and Cullinan.