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Sarine’s 4Q Revenue -32%, Profit Plummets 62%

Mar 1, 2016 7:51 AM   By Rapaport News
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RAPAPORT... Sarine Technologies reported revenue slumped 32 percent to $12.4 million in the fourth quarter that ended December 31 as diamond manufacturing levels fell.

Profit dived 62 percent year on year to $1.5 million during the period, according to a statement February 28 by the Singapore-listed company, which makes technological products for diamond and gemstone production.

Diamond manufacturing activities dropped 30 to 50 percent because of “overly aggressive” rough diamond pricing in contrast to stagnant polished prices and higher than normal polished inventory levels, Sarine said. However, the market picked up in December as strong holiday sales depleted polished inventory and boosted prices, with the RapNet Diamond Index (RAPI™) for 1-carat, GIA-graded diamonds rising 1.5 percent in December and 0.9 percent in January.

As a result of the market improvement and the launch of Sarine’s small-stone Meteor inclusion mapping system, the company’s fourth-quarter revenue was 31 percent higher than the previous three months.

Full-year revenue dived 45 percent to $48.5 million and profit plummeted 87 percent to 3.6 million. Nonetheless, the board recommended a dividend policy of $0.02 per share every six months, compared with a full-year cumulative dividend of $0.03 per share for 2015.

“With the reduction of inventories, working capital credit availability is also less of a problem in the midstream and Indian banks are reportedly softening their attitude towards the industry,” said Uzi Levami, chief executive officer of the Israel-based company.

“Even though manufacturers are wary of Chinese market demand slowing, we are seeing record numbers of stones being scanned by our inclusion mapping systems and have already taken orders in the first two months of 2016 equal to the business realized by the group in all of Q4 2015. Barring unforeseen circumstances, we expect midstream manufacturing activities to continue to improve over the course of the year.”
Tags: Israel, Manufacturing, Rapaport News, Sarine, Sarine Technologies, Singapore, technology
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