Petra Diamonds, a diamond mining and marketing company listed in London, anticipates a slight rebound in diamond prices in 2025, with market fundamentals expected to provide pricing support in the medium and long term.
Currently, Petra anticipates the diamond market will remain weak through the end of the year, with some price volatility expected. CEO Richard Duffy expressed optimism about the company’s future. “We’re looking forward to addressing the challenges ahead of us from a position of strength, with world-class assets that have long-term potential, strong sustainability credentials, and an ability to withstand market and capital cycles,” Duffy said in a release.
Petra’s portfolio includes the Cullinan, Finsch, and Koffiefontein underground mines in South Africa and the opencast Williamson mine in Tanzania. The Koffiefontein mine is on care and maintenance, preparing for a possible sale.
During the company’s 2024 financial year (FY), which ended in June, Petra sold 36% more diamond carats than in FY 2023. This increase boosted revenue by 13%, driven by Williamson reaching a steady state and the delayed sale of the final tender in FY 2023.
Despite the rise in sales, yearly production was slightly below the revised guidance at 2.73 million carats. The ore processed increased to three million tons from 2.9 million tons, with Williamson’s ramp-up adding 0.1 million tons. Production remained steady at Cullinan and Finsch.
At Finsch, the increasing contribution from 78-Level Phase II led to continued improvements in grade recovery. However, work to resolve the winder issues and the shift from continuous operations to a two-shift, five-day configuration reduced carats recovered compared to FY 2023.
The revenue, including profit share arrangements, increased to $113 million, primarily due to the timing extension of Tender 5 receipts. Operational capital expenditure for the fourth quarter amounted to $18 million, and net debt decreased to $201 million.
For the fiscal year 2025, Petra expects to produce between 2.8 million and 3.1 million carats. This positive outlook is supported by the company’s continuous efforts to improve operational efficiency and sustainability.
Petra’s strategic focus on sustainability and robust asset management positions it well for future growth. The company’s commitment to maintaining high sustainability standards and leveraging its strong asset base is key to its long-term success.
The volatility of the diamond market highlights the importance of mining companies being resilient and adaptable. Petra’s strategy involves addressing market challenges while seizing opportunities for growth. The company’s diverse portfolio and strategic initiatives form a strong foundation for navigating market fluctuations.
Petra Diamonds is well positioned for a modest resurgence in diamond prices in 2025. The company has a robust asset base, a focus on sustainability, and strategic planning to address future challenges and take advantage of market opportunities.
Source: Mining Weekly
