Petra Diamonds gave a downbeat outlook after weak rough demand drove the company into the red in the most recent financial year.
Revenue slid 42% to $325.3 million for the 12 months that ended June 30, the miner reported Friday. Sales volume dropped 33% to 2.3 million carats, with the average price falling 14% to $139 per carat.
The slump reflected decrease in production, the deferral of sales to the 2024 fiscal year due to the market slowdown, and a decline in revenue from exceptional stones.
Output from Petra’s mines fell 20% to 2.7 million carats, excluding Koffiefontein, which the company is in the process of shuttering.
As a result, the company which owns the Cullinan and Finsch mines in South Africa as well as Williamson in Tanzania recorded a net loss of $102.4 million after tax for the fiscal year, compared with a profit of $88.1 million for the previous period.
The miner’s first tender of the new fiscal year, which took place in August, saw sluggish demand for 2- to 10-carat rough. Market conditions have remained soft due to “prevailing macroeconomic uncertainties around high interest and inflation rates,” said Petra CEO Richard Duffy.
“Although there has been some stabilization in global economies and growth outlooks for [the] 2023 [calendar year], the economic outlook for [the] 2024 [calendar year] is now more subdued,” Duffy continued.
“Notwithstanding this, we continue to see the prevailing structural supply deficit of diamonds providing market support in the medium to longer term.”
Still, Petra maintained its production forecast of 2.9 million to 3.2 million carats for the current fiscal year, which ends on June 30, 2024.
