Petra Revenue Falls Amid Continued Rough-Price Weakness

Revenue at Petra Diamonds decreased in the first fiscal half amid a sluggish market and the timing of its tenders.

Sales dropped 13% year on year to $100 million for the six months that ended December 31, the company said last week. Sales volume declined 13% to 963,523 carats, while the average price grew 1% to $104 per carat. Though the average price rose overall for the period, it fell 11% in the second quarter compared to the first three months amid a 20% reduction in like-for-like prices across all sizes, partly offset by an improved product mix, the company explained.

The miner also faced difficulties due to the continuing strength of the South African rand against the US dollar. The company earns money in the South African currency but pays its bills and debts in US.

The company reported a net loss of $188 million for the first half, a wider deficit than its $69 million loss a year ago. Petra attributed part of the loss to the currency fluctuations, while a large portion was the result of an impairment charge, or write-down, of $168 million to its property, plant and equipment, which are worth less due to the downturn in the market.

Production for the period rose 4% to 1.2 million carats, despite weather-related disruptions, the company noted.

Petra has partnered with rough-diamond tender house Bonas Group, which will provide diamond sales and marketing services. The agreement will give Petra the flexibility to market its diamonds in Antwerp and Dubai, rather than only in South Africa, it said.

The miner’s net debt increased to $284 million as of December 31 from $261 million on June 30. It currently holds 608,217 carats worth $46 million in inventory, compared with 385,878 carats valued at $40 million as at December 31, 2024.

“Our financial results reflect the discipline in managing our costs and capital, as well as the anticipated improvement in product mix…offset by the continuing weaker market and the strength of the South African rand,” said Vivek Gadodia and Juan Kemp, joint CEOs at Petra. “The diamond market remained subdued during the first half, with the smaller sizes coming under further strain during the second half, with average like-for-like prices down. Looking ahead, we remain focused on consistent production, disciplined cost and working-capital optimization.”

Image: The Cullinan mine (Petra Diamonds)