Petra reports lower revenue in Tender 2 sales on back of market dynamics

17th October 2023

By: Marleny Arnoldi

Deputy Editor Online


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London-listed Petra Diamonds has announced the full results of its second sales tender for the 2024 financial year, having sold 444 029 ct for $40.5-million in revenue.

The second sales tender included 37 900 ct recovered from the Williamson mine, in Tanzania, after restarting operations in mid-2023, marking the start of the steady ramp-up of carats available for tender from this mine.

The remainder of the diamonds were sourced from the Cullinan and Finsch mines, in South Africa.

The company realised an average price of $91/ct in the second sales tender, compared with an average price of $114/ct realised in the first sales tender. This compares to an average realised price of $135/ct realised in the second tender of the 2023 financial year.

CEO Richard Duffy explains that like-for-like prices for diamonds sold were down 16.9% compared with the first sales tender held in August, but were in line with the range expected, considering prevailing market weakness.

“We believe actions taken by major producers to curb supply and the two-month Indian moratorium will assist in bringing stability and support to the market and prices as inventory levels reduce,” he adds.

While Petra anticipates that prices will remain volatile throughout the remainder of this calendar year and possibly into next year, it continues to expect prices to benefit in the medium to longer term as a result of the structural supply deficit.

The results of the second sales tender bring the company’s year-to-date revenue from rough diamond sales to just under $120-million, compared with $161-million of revenue having been generated in the first two tenders of the prior financial year.

Petra has revised its 2024 financial year pricing assumptions downward owing to current market dynamics, which it believes to be temporary in nature.

The previous assumption of between $125/ct and $140/ct for diamonds from the Cullinan mine has been revised downward to between $110/ct and $130/ct, while the prior price assumption for diamonds from the Finsch mine has been revised downward from between $105/ct and $120/ct to between $100/ct and $115/ct.

Diamonds from the Williamson mine will realise the highest price at between $225/ct and $250/ct, albeit down from Petra’s prior assumption of between $240/ct and $270/ct.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online



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