Petra Diamonds, listed on the London Stock Exchange, generated $38 million in revenue during its seventh tender cycle this year. The company sold 337,064 carats of diamonds.
This brings Petra’s revenue for the 2024 financial year to $366 million, with 3.15 million carats sold. This marks an increase from the prior year’s $324 million revenue and 2.32 million carats sold.
Despite the higher revenue, average diamond prices dropped. Prices averaged $116 per carat this year, down from $139 per carat last year.
Petra noted that like-for-like prices fell by 3.8% to $111 per carat in the seventh tender cycle, compared to $118 per carat in the sixth cycle. This decline is due to continued softness in demand for coarser diamonds, specifically those between 1 and 10 carats.
For the year under review, like-for-like prices were 12.4% lower than the previous financial year.
In addition to rough diamond sales, Petra benefited from selling three partnership diamonds. This resulted in a $1.3 million profit for the year, slightly down from $1.4 million the previous year.
The company expects the market to remain subdued through the end of the current calendar year. Price assumptions for the 2025 financial year remain between $125 and $135 per carat for diamonds from the Cullinan mine, between $98 and $105 per carat for diamonds from the Finsch mine, and between $200 and $225 per carat for diamonds from the Williamson mine.
The Cullinan and Finsch operations are based in South Africa, while the Williamson operation is in Tanzania. Petra’s Koffiefontein mine in South Africa is currently on care and maintenance, preparing for asset disposal.
Petra’s performance reflects both resilience and the challenges facing the diamond market. The company continues to adapt to fluctuating demand and market conditions, aiming to optimize revenue while managing operational costs.
Despite the lower average prices, the increase in total carats sold demonstrates Petra’s effective sales strategy. The diamond market’s volatility underscores the importance of Petra’s strategic planning and market responsiveness.
Looking ahead, Petra remains cautious but optimistic. The company’s consistent revenue growth and ability to manage price fluctuations position it well for future opportunities. Petra’s ongoing efforts to dispose of the Koffiefontein mine indicate a strategic focus on core operations and asset optimization.
The diamond industry faces ongoing challenges, including fluctuating demand and pricing pressures. Petra’s ability to generate higher revenue despite these challenges highlights its strong market position and adaptive strategies.
As the company moves forward, maintaining a balance between operational efficiency and market adaptability is crucial. Petra’s strategic initiatives, along with its focus on core operations, are likely to continue driving its success in the diamond market.
Source: Mining Weekly
