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Sarine Turns Profit Following Cutbacks
Aug 9, 2020 7:28 AM
By Rapaport News
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RAPAPORT... Sarine Technologies ended the first half of 2020 in the black as deep cost cuts offset the effects of Covid-19.
The supplier of diamond-polishing equipment made a profit of $1.2 million for the period, compared with a loss of $2.8 million a year earlier, it reported Thursday.
The company brought its expenses down by around 20% year on year in response to the unprecedented situation. It furloughed employees in areas that saw a slump in activity, such as manufacturing, sales and grading laboratories; shortened staff members’ working weeks; and requested voluntary pay reductions of 10% to 20%.
The lack of marketing activities and trade shows also slashed expenses. Meanwhile, the coronavirus lockdown in India meant the company incurred lower legal costs than usual: Sarine has often been involved in cases against third parties that try to manipulate its diamond-mapping systems or otherwise infringe its intellectual-property rights.
Revenue declined 0.5% year on year to $22.4 million for the six months as the virus outbreak canceled out the company’s strong start to the year.
Sarine derives most of its revenues from sales of manufacturing equipment to diamond cutters, mainly in India, and from fees customers pay on a recurring basis for use of its rough-scanning machines. Demand for these products and services was strong in early 2020 but collapsed in the second quarter, when the pandemic led to reduced diamond sales at retail and an almost total shutdown of the Indian manufacturing sector.
Image: Sarine Technologies’ automated clarity-grading system. (Sarine Technologies)
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Tags:
Coronavirus, COVID-19, furloughs, Manufacturing, pay cuts, Rapaport News, Sarine, Sarine Technologies
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