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Sarine Anticipates Return to Profitability

Oct 24, 2019 9:32 AM   By Rapaport News
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Sarine Technologies expects to register a “nominal” net profit for the third quarter, as sales of mapping machines for small diamonds increased amid a lessening of the midstream inventory crisis.

The manufacturer of equipment for the diamond trade forecast revenue of $14 million, representing 20% growth versus the $11.7 million sales it reported for the same period a year ago. While total sales of its inclusion-mapping technology remained subdued because of a decline in polishing activity, demand for its Meteor and Meteorite systems for small stones improved, the company explained in a recent trading update.

“Back in the beginning of the year we told people we thought we’d be selling 90 such systems this year,” Sarine chairman Daniel Glinert told Rapaport News Thursday. But sales figures “are simply going in a direction where we did not expect them to be so soon,” he said. Glinert also noted a “beginning of the easing of the inventory issue” that has hurt the manufacturing sector this year.

Lower rough supply from miners such as De Beers has helped reduce stockpiles and improve liquidity in the midstream, the company added. Customers are increasingly buying mapping equipment outright rather than paying according to usage, Glinert added. That has lifted Sarine’s gross margin, contributing to a likely return to profitability following two quarters of losses, he said. However, other negative market conditions prevailed, the Israel-based company cautioned.

“The ongoing trade disputes between the US and China continued to impair demand in the Chinese market by an estimated 10%,” it said, adding that “the issue of lab-grown diamonds continued to be a distraction.”

Image: Sarine Technologies headquarters in Hod HaSharon, Israel. (Sarine Technologies)
Tags: Galaxy, meteor, Meteorite, Rapaport News, Sarine, Sarine Technologies
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