Petra Diamonds share price rises profits jump 68pc

 
Billy Ehrenberg
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Petra Diamonds released its preliminary results today, which showed a $27.6m (£16.9m) price for a 122 carat blue diamond (Source: Petra Diamonds)

A bit of good news for Petra Diamonds investors, who showed their disappointment earlier this week when the company failed to raise the price it expected for a rare 122.52-carat blue diamond.

The company's shares opened 0.3 per cent lower on Tuesday morning after the gem raised just $28m (£16.9m) at auction, rather than the $35-$50m analysts had been hoping for. Although Petra retained a stake in the gem, selling 85 per cent of the diamond to an anonymous polishing partner, and the two will sell the stone together.

But shares in the company rose one per cent this morning after its preliminary results (which didn't include the sum raised from the auction) showed a profit before tax of $124.4m, up from $74m in 2013, an increase of 68.1 per cent and a 20 per cent increase in revenue, which was reported at $471.8m.

From the report:

Post Year end, Petra announced a sales and beneficiation agreement for the 122 carat blue diamond recovered at Cullinan, valuing the stone at $27.6m; Petra will record $23.5m (being the polishing partner's payment for a 85 per cent interest) in Q1 FY 2015 and will receive a 15 per cent share in the net proceeds of the polished yield, after beneficiation and related expenses.

Petra has another incredibly valuable stone on the table: a less-rare but larger white diamond of 232 carats. It was, Petra said, of exceptional size, colour and clarity."

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