Petra Diamonds said it produced 1.43 million carats of diamonds in the six months that ended 31st December 2023, a 2% increase from the same period last year. This was mainly driven by the resumption of operations at its Williamson mine in Tanzania, which was suspended for most of 2023 due to a dispute with the government, and the increased contribution from its Finsch mine in South Africa.
Petra also said it made good progress on its development projects at its flagship Cullinan mine in South Africa, where it is investing to extend the mine life and access higher value ore. The company expects to complete the replanning and value-engineering work associated with the deferred capital projects by July 2024, and will update the market on the expected impact on its future guidance.
However, Petra also faced some challenges in the first half of the year, as the global diamond market remained subdued due to the Covid-19 pandemic and its impact on consumer demand. The company said its revenue fell 10% to $187.8 million, as its average selling price dropped 13.3% compared to the same period last year. The company also saw its net debt increase to $212.3 million, due to the timing of its sales tenders, the lower diamond prices, the working capital funding for Williamson, and the increasing capital expenditure.
Richard Duffy, Chief Executive Officer of Petra, said, “Production increased 2% in this period as operations continued to stabilise at Finsch and Cullinan Mines and Williamson continued its ramp-up to full production. We remain on track to meet our FY 2024 production guidance of 2.9 – 3.2 million carats although, as announced on 1 November 2023, we expect it will be towards the lower end of guidance.
“While we are seeing encouraging indications of price recovery and some stabilisation in the rough diamond market, following actions taken by both producers and the mid-stream, we continue to adopt a cautious approach to the market in the near-term.”