Petra Diamonds revenues drop 7% despite 17% rise in volumes

Petra Diamonds has reported a 7% drop in tender three FY 2025 sales to $71m (£56.6m) despite selling 700,803 carats, up 17% compared with the combined 600,161 carats sold in tenders one and two.

The group stated that its sales were affected by a continued weak market across most size ranges.

Average diamond prices for the tender also fell by 20% from $12 (£9.57) to $101 (£80.5) per carat.

Mine by mine average prices for the respective periods revealed that Cullinan mine’s average was up from $146 (£116.4) per carat in earlier tenders to $1002 (£799.1) per carat in tender three.

Similarly, Williamson mine saw a slight increase to $174 (£138.7) per carat in tender three, compared with $164 (£130.8) per carat in earlier tenders.

However, The Finsch mine averaged $72 (£57.4) per carat, a decline from $84 (£67) per carat in the earlier tenders.

As a result of the prevailing market weakness, the group revised its price assumptions for FY 2025. The Cullinan mine’s forecast range was revised to between $120 (£95.71) and $130 (£103.6) per carat, while the Finsch and Williamson mines’ assumptions were lowered to $80 (£63.8)to $90 (£71.7) and $170 (£135.5) to $200 (£159.5) per carat, respectively.

Richard Duffy, CEO of Petra, said: “Our third tender cycle yielded US$71m from the sale of 700,803 carats bringing year-to-date sales revenues to $146m (116.4m) from the sale of 1,300,964 carats. Like-for-like prices reduced by 7% from the previous tender cycle held in October reflecting a continued weak market across most size ranges, although we were encouraged by the 3% increase in the 5-10.8 carat category.

“As a result of the prevailing market weakness, we have revised our price assumptions for FY 2025 as set out below. Despite the market backdrop, we are encouraged by the majors’ ongoing discipline around restricting the volume of rough diamonds to support the market and initiatives by upstream, midstream and retail sectors to collaborate in the category marketing of diamonds.”

He added: “We remain committed to our target of net cash generation in FY 2025 and have commenced additional cash generation and savings initiatives. This has regrettably required us to initiate a section 189 (retrenchment) process affecting our Group and SA Operations support functions. Vivek Gadodia has been appointed Chief Restructuring Officer to lead the execution of this work.

“Refinancing discussions have been deferred to CY 2025 to enable these cash generation initiatives to take effect and to benefit from greater certainty in respect of market conditions. We remain confident of a successful refinancing of the 2026 2L Notes and a further update will be provided at the time of our interim results in February 2025.”