Petra Diamonds production sparkles

 
Emma Haslett
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Diamond production rose 30 per cent, Petra Diamonds said (Source: Getty)

Diamond producer Petra had a sparking first quarter, production-wise - but it also reported four fatalities in three separate incidents.

The figures

FTSE 250-listed Petra said revenues hit $94.7m (£77.5m) in the three months to the end of September, after it sold 745,447 carats.

Production rose 30 per cent to 1.1m carats, up from 842,796 carats during the same period last year. However, net debt also rose, from $384.8m last year to $463.9m in the first quarter of this year - that's more than 50 per cent up.

It added that rough diamond prices in the year to date had remained flat on a like for like basis.

Shares jumped 7.6 per cent to 150.4p in early trading.

Why it's interesting

It's been an interesting year for Petra, which operates a number of mines formerly owned by De Beers, and which in June unearthed a giant 121.26 carat white diamond at the Cullinan mine in South Africa, the site where the gems which adorn the Crown Jewels were discovered.

It was a turn up for the books at the company - in January it reported revenues in the previous six months had fallen 28 per cent as a result of falling diamond prices and a weak South African rand.

But while it reported higher debts today, the company said its first quarter had been a "strong start", and added it expected to produce between 4.4m and 4.6m carats this year, in line with expectations.

It also expressed regret at the loss of four of its workers' lives.

"Petra has always taken pride in excellent safety results posted by its operations. It is therefore with deep regret that we report fatal injuries suffered by four of our employees," said chief executive Johan Dippenaar.

"Across the group, we have embarked upon renewed safety drives to reiterate our zero-tolerance approach to unsafe acts and working conditions with an aim of zero harm to our workforce and contractors."

What Petra said

Dippenaar added:

The newly established caves at both Finsch and Cullinan, accessing higher grade undiluted areas, are starting to meaningfully contribute to run-of-mine production, which is continuing to ramp-up in line with expectations.

The diamond market is holding firm with prices on a like for like basis matching those realised in the period January to June 2016 (our second half).

Petra's focus remains on the health and safety of our workforce, maintenance of a healthy balance sheet, the tight control of costs and the successful roll-out of our expansion plans, which will continue to deliver increased contributions from higher quality production areas.

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