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Interim results for the six months to 31 December 2008
23 February 2009
Focus on cash-generative production
Petra Diamonds Limited, the international diamond mining group, announces its interim results (unaudited) for the six months to 31 December 2008 (“the Period”).
Operational and financial highlights
- Gross revenue* from rough diamond sales for the Period: US$47.3 million, a 49% increase on the six months to 31 December 2007: US$31.7 million; Group attributable revenue* from rough diamond sales for the Period: US$33.8 million (31 December 2007: US$31.7 million)
- Gross production of 550,413** carats, a 444% increase on the six months to 31 December 2007: 101,213 carats
- On-mine gross profit: US$10.2 million (2007: US$15.5 million)
- South African mines cash flow positive for the Period; cash mainly applied on Cullinan and Williamson acquisitions, Kimberley Underground development / plant and Angolan exploration (now ended), resulting in cash at bank US$10.5 million (2007: US$59.0 million)
- Total resource base increased to 265 million carats (value US$27.3 billion as at September 2008 Resource Statement)
Current trading
- Acquisition of the Williamson diamond mine in Tanzania completed 19 February 2009 (ownership effective from 10 November 2008)
- Now the operator of six diamond mines in South Africa (5) and Tanzania (1)
- Two exceptional blue diamonds recovered at Cullinan of 39.19 carats (sold for US$8.8 million) and 26.58 carats (in stock)
- Exploration budget cut by US$25 million to focus resources on the development of the cash–positive producing operations
- Withdrawal from both the Alto Cuilo and Luangue projects in Angola (effective end December 2008)
- Sierra Leone – Petra’s joint venture partner at Kono has assumed sole funding of the Kono advanced exploration project (effective 1 January 2009)
*In accordance with IFRS, the Group has proportionately consolidated 50% (joint venture interests held 50% Petra, 50% Al Rajhi Holdings W.L.L.) of the results of the Cullinan mine, which after the deduction of 13% in respect of the BEE minority interests gives the 37% attributable to the Group. Gross revenue and gross production is 100% Cullinan, attributable numbers are as noted above.
**including 19,318 carats produced at Williamson from the effective transaction date of 10 November to 31 December 2008. There were no sales of Williamson diamonds during this period.
Johan Dippenaar, Chief Executive Officer, comments:
“The Petra group is built on very strong foundations and a low cost production focus. With our world class production base being enhanced by the addition of the Kimberley Underground and Williamson mines, the decision to exit capital intensive exploration activity was a sound and swift response to the pressures brought on by the global financial environment.
“Petra’s world-class asset base and management team positions the business to weather present market circumstances and to benefit strongly when the diamond market recovers.”
| 6 months to 31 December 2008 US$ million | 6 months to 31 December 2007 US$ million | |
|---|---|---|
| Revenue | 33.8 | 32.1 |
| Rough diamond sales | 33.8 | 31.7 |
| Polished diamond sales | - | 0.4 |
| Gross profit * | 10.2 | 15.5 |
| Exploration expenses * | (13.2) | (1.0) |
| Administration expenses * | (3.3) | (4.4) |
| EBITDA ** | (6.3) | 10.1 |
| Depreciation | (7.0) | (3.8) |
| Amortisation | (1.7) | (2.0) |
| Impairment charge on assets | (75.2) | - |
| Share bases expense | (0.4) | (0.7) |
| Foreign exchange (loss) / gain | (2.1) | 5.7 |
| Net finance income / (expense) | (1.9) | (0.4) |
| Profit / (loss) from discontinued operation | 2.1 | (0.6) |
| Tax credit / (charge) | 4.5 | (0.1) |
| Net (loss) / profit for the period *** | (88.0) | 8.2 |
| (Loss) / profit per share US cents *** | (49.37) | 2.44 |
| * | stated before depreciation, amortisation of intangibles, interest paid, foreign exchange gains and losses, asset impairment charges and share based payments. |
| ** | EBITDA disclosures are “adjusted EBITDA”, being stated before share based expense, foreign exchange gains and losses and asset impairment charges. |
| *** | Stated before minority interests (BEE partners Cullinan, Koffiefontein, Sedibeng) of US$2.77 million |
For further information, please contact:
Cathy Malins
Telephone: +44 20 7318 0452
Petra Diamonds, London
cathym@petradiamonds.com
Adrian Hadden
Telephone: +44 20 7523 8350
Collins Stewart, London
ahadden@collins-stewart.com / pcoombs@collins-stewart.com
Media relations:
Julian Walker
Telephone: +44 20 7357 9477
Hogarth Partnership, London
pdl@hogarthpr.co.uk
James Duncan / Nicola Taylor
Telephone: +27 11 880 3924
Russell and Associates, Johannesburg
james@rair.co.za / nicola@rair.co.za
View the Interim results for the six months to 31 December 2008 (PDF - 160KB)
About Petra Diamonds
Petra Diamonds is a rapidly growing diamond mining group, focused on the African continent. A number of recent acquisitions have established Petra Diamonds as one of the world’s largest independent diamond groups by resources, with a total resource base of 265 million carats, worth US$27.3 billion (as at September 2008 Resource Statement). The Company’s objective is to continue to develop its stature as a leading diamond producer in all of the countries in which it operates.
Petra Diamonds’ objective is to bring this world-class resource base to account and to increase its annual production from 200,000 carats in the year to June 2008 to over 1 million carats in the year to June 2009.
In South Africa, Petra Diamonds has five producing mines – Cullinan, Koffiefontein, Helam, Sedibeng and Star - and has also reached agreement to acquire, from De Beers, the Kimberley Underground mines. In Tanzania, Petra has recently acquired a 75% interest in the producing Williamson mine.
Petra Diamonds will only commit to working in countries which are members of the Kimberley Process and shareholders can remain assured that the Company’s diamonds will only ever be 100% conflict free.
Petra Diamonds is listed in London under the share code PDL. For further information, please go to Petra’s website (which has been significantly revised and updated with effect from 23 February 2009), www.petradiamonds.com
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