REG - Petra Diamonds Ltd - Initial sales results for Tender 3 FY 2024

Petra DiamondsAnnouncement

08/12/2023 07:00

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RNS Number : 1060W  Petra Diamonds Limited  08 December 2023

 08 December 2023  LSE: PDL

 

Petra Diamonds Limited

("Petra" or "the Company")

 

Initial sales results for Tender 3 FY 2024

 

 

Petra announces initial sales results for Tender 3 of FY 2024, at which 462.8
kcts were sold for a total of US$58.7 million, representing a c. 20% increase
in like-for-like 1  prices compared to Tender 2 FY 2024, which closed in
October 2023. Final sales for this third cycle are scheduled to close next
week, with around 31 kcts from Williamson mine on tender at the Company's
sales facilities in Belgium, and some 25 kcts from the South African
operations planned to be sold to local clients to meet our South African
Diamond Beneficiation obligations.

 

Richard Duffy, Chief Executive Officer of Petra, said:

 

"The 20% increase in like-for-like(1) prices for our third tender of FY 2024
supports the view that diamond prices have likely bottomed. We believe actions
taken by major producers to curb supply and the two-month Indian moratorium
that comes to an end on 15 December 2023, together with strengthened retail
sales in the US, have improved market conditions as inventory levels across
the pipeline rebalance. Ongoing discipline by the key players is important to
provide some price stability in the new year."

 

 

Rough diamond sales results for the respective periods are set out below(1):

 

                                                   Tender 3 (initial)  Tender 2     Variance  Tender 3  YTD           YTD

                                                   FY 2024             FY 2024                FY 2023   FY 2024       FY 2023

                                                   Dec-23              Sep/Oct-23             Dec-22    Tenders 1-3   Tenders 1-3

                                                                                                        (initial)
 Diamonds sold (carats)                            462,794             444,029      4%        303,300   1,603,017     1,264,722
 Sales (US$ million)                               58.7                40.5         45%       41.5      178.5         202.8
 Average price (US$/ct)                            127                 91           39%       137       111           160
 Revenue from Exceptional Stones(2) (US$ million)  0.0                 0.0          n.a.      0.0       0.0           0.0

Note 1: Excludes all Koffiefontein sales results since it has been classified
as a discontinued operation in the Group's FY 2023 accounts.

Note 2: Exceptional Stones are defined as rough diamonds for US$15 million or
more each.

 

 

Sales

A total of 411.7kcts of goods from Cullinan Mine and Finsch were sold,
yielding US$48.3 million, and 51.0kcts from Williamson yielding US$10.4
million.

 

The current cycle also includes 31.3kcts from Williamson to be tendered at our
Belgium facility and around 25kcts from the South African operations planned
to be sold to South African customers next week.  These sales will be
included in the final results of this third tender cycle and in the Company's
H1 FY 2024 financial results.

 

The provisional results of Tender 3 bring FY 2024 YTD revenue from rough
diamond sales to US$178.5 million, compared to US$202.8 million in the first
three tenders of FY 2023, excluding Koffiefontein. Year-on-year volume
variances were affected by the deferral of certain FY 2023 sale parcels, which
were sold as part of Tender 1 of FY 2024.

 

Mine by mine average prices for the respective periods are set out in the
table below:

 

 US$/carat      Tender 3    Tender 2     YTD FY 2024   YTD FY 2023   FY 2023

                FY 2024     FY 2024      Tenders 1-3   Tenders 1-3

                (initial)   Sep/Oct-23   (initial)

                Dec-23
 Cullinan Mine  133         78           110           154           139
 Finsch         94          83           101           121           110
 Williamson     203         203          203           280           280

 

Like-for-like prices

Like-for-like rough diamond prices for goods sold improved by c.20.0% on
Tender 2 FY 2024, driven by over 20% increases in the prices achieved for
goods smaller than 2cts, while 2 to 10.8ct parcels saw increases in the
mid-teens. Year to date like-for-like prices are down 13.2% compared to the
equivalent three tenders of FY 2023.

 

Product mix

The balance of price movements is attributable to product mix, with an
improved contribution from higher-value single stones from Cullinan Mine,
including a 12.6ct blue stone that sold for US$6.2 million, while Finsch and
Williamson saw marginally reduced overall qualities in their product offering,
although both remained within the expected range of product variability.

 

 

For further information, please contact:

 

Investor Relations, London                  Telephone: +44 20
7494
8203

Patrick Pittaway
  investorrelations@petradiamonds.com
(mailto:investorrelations@petradiamonds.com)

Julia Stone

Kelsey Traynor

 

Financial PR (Camarco)

Gordon
Poole
Telephone: +44 20 3757 4980

Owen
Roberts
petradiamonds@camarco.co.uk (mailto:petradiamonds@camarco.co.uk)

Elfie Kent

 

 

About Petra Diamonds Limited

Petra Diamonds is a leading independent diamond mining group and a supplier of
gem quality rough diamonds to the international market. The Company's
portfolio incorporates interests in three underground mines in South Africa
(Finsch, Cullinan Mine and Koffiefontein) and one open pit mine in Tanzania
(Williamson). The Koffiefontein mine is currently on care and maintenance in
preparation of closure.

 

 

Petra's strategy is to focus on value rather than volume production by
optimising recoveries from its high-quality asset base in order to maximise
their efficiency and profitability. The Group has a significant resource base
which supports the potential for long-life operations.

 

Petra strives to conduct all operations according to the highest ethical
standards and only operates in countries which are members of the Kimberley
Process. The Company aims to generate tangible value for each of its
stakeholders, thereby contributing to the socio-economic development of its
host countries and supporting long-term sustainable operations to the benefit
of its employees, partners and communities.

 

Petra is quoted with a premium listing on the Main Market of the London Stock
Exchange under the ticker 'PDL'. The Company's loan notes due in 2026 are
listed on the Irish Stock Exchange and admitted to trading on the Global
Exchange Market. For more information, visit www.petradiamonds.com.

(#_ftnref1) 1 Like-for-like refers to the change in realised prices between
tenders and excludes revenue from all single stones and Exceptional Stones,
while normalising for the product mix impact

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