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Petra Diamonds' Revenue +44% in FY12
Plans to Sell Fissure Mines
Jul 31, 2012 3:35 AM
By Avi Krawitz
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RAPAPORT... Petra Diamonds reported that group revenue grew 44 percent year on year to $316.9 million in the fiscal year that ended on June 30, 2012 as new production from its Finsch mine was made available.
Petra’s total production rose 98 percent to 2.208 million carats during the fiscal year, while the quantity of goods it sold increased 77 percent to 2.084 million carats.
Production was boosted by the Finsch mine (pictured), which Petra acquired from De Beers in September 2011, as the operation contributed 1.104 million carats of the total production. Sales from the mine reached 136.9 million during the year with the average price of $138 per carat.
Production at the Cullinan mine fell 3 percent to 867,780 carats, while sales from the operation declined 20 percent to $112 million. The average price of Cullinan sales fell 14 percent to $128 per carat. Similar trends of lower sales and prices were witnessed at Petra’s Koffiefontein, Williamson and fissure mines, while its Kimberley underground operation registered a slight increase in sales with higher production compensating for the lower prices achieved there.
The company warned, however, that it expects the rough diamond market to remain under pressure in the short term after prices weakened in the June quarter due to deteriorating global economic conditions.
Petra further announced plans to sell its fissure mines, which include the Helam, Sedibeng and Star mines in South Africa.
“Given Petra's development and growth over recent years, the fissure mines are no longer core to the group,” explained Johan Dippenaar, Petra’s chief executive. “The fissure mines produce high-value stones and under the right ownership they have the potential to deliver strong returns for many years to come, whilst at the same time providing employment to the communities in the surrounding areas.”
Combined production at the three fissure mines fell 19 percent year on year to 70,874 carats in fiscal 2012. Sales dropped 19 percent to $17.7 million with the average price rising 5 percent to $255 per carat.
Dippenaar said that the sale would not impact by the company’s goal to reach annual production of 5 million carats by fiscal 2019. Growth will be driven by the group’s major assets, he added.
Petra reported that its capital expenditures for the year were in line with expectations at $134 million, compared with $110.6 million in fiscal 2011. The company had $37.4 million in cash at year's end, while its diamond inventory rose 83 percent to $24.3 million.
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Tags:
Avi Krawitz, Cullinan, diamonds, Finsch, Fissure mines, Koffiefontein, Petra Diamonds, Rapaport
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