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Petra posts higher revenue, shrinks debt pile

Published 23/07/2018, 08:18
© Reuters. FILE PHOTO - A visitor holds a 17 carat diamond at a Petra Diamonds mine in Cullinan

(Reuters) - Petra Diamonds Ltd (L:PDL) reported a 21 percent increase in full-year revenue on higher diamond prices and production on Monday, while a tight leash on costs helped the miner cut its debt pile by 15 percent.

Petra has taken measures to keep its debt on check after years of heavy spending, but the impact of a confiscated consignment in Tanzania and the recent strengthening of the South African rand has hurt its business.

Total production rose 15 percent to 4.6 million carats, helped by the ongoing ramp-up of its new Cullinan plant in South Africa.

Petra, which operates four mines in South Africa and one in Tanzania, said production at Cullinan alone jumped 74 percent to 1.4 million carats.

Net debt fell to $436.1 million as of June 30 from $513.9 million at the same time last year, while operating costs remained in line with its expectations during the year, Petra said.

The company said it saw a 2 percent rise in rough diamond prices on a like-for-like basis during the year, adding that it expects the diamond market to remain healthy.

Revenue rose to $576.4 million (£331.8 million) for the twelve months to June 30 from $477 million a year earlier.

Petra said on Monday there was no update regarding its confiscated diamond parcel in Tanzania.

The Tanzania government confiscated a consignment of diamonds from a mine majority-owned by Petra in August last year after accusing the firm of under-declaring the value of the stones by about half. Petra has denied the charge.

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