TIDMPDL
RNS Number : 7641Z
Petra Diamonds Limited
16 January 2024
16 January 2024 LSE: PDL
Petra Diamonds Limited
H1 FY 2024 Operating Update
Petra reports its operating results for the first half of FY
2024
Richard Duffy, Chief Executive Officer of Petra, commented:
"Production increased 2% in this period as o perations continued
to stabilise at Finsch and Cullinan Mines and Williamson continued
its ramp-up to full production. We remain on track to meet our FY
2024 production guidance of 2.9 - 3.2 Mct although, as announced on
01 November 2023, we expect it will be towards the lower end of
guidance. We continue to make good progress on the CC1E development
project at Cullinan Mine and the 78-Level Phase II development
project at Finsch, and the resumption of the deferred capital
programmes remains on target for July 2024. The replanning and
value-engineering work associated with the deferred capital
projects continues and, once completed, the Company will inform the
market of the expected impact on forward looking guidance.
While we are seeing encouraging indications of price recovery
and some stabilisation in the rough diamond market, following
actions taken by both producers and the mid-stream, we continue to
adopt a cautious approach to the market in the near-term. Once
completed, the additional headroom afforded by our increased
Revolving Credit Facility will enable us to continue our flexible
sales approach and position ourselves to take advantage of any
market improvements. "
Highlights vs H1 FY 2023
-- LTIFR and LTIs decreased to 0.15 and 5 respectively
-- Ore processed increased 8% to 5.8Mt largely due to the
successful ramp-up of production at Williamson
-- Total diamond production increased 2% to 1.43 million carats
mainly due to resuming operations at Williamson and increased ROM
contribution at Finsch, partially offset by slightly lower grades
at the Cullinan Mine
-- Support from a weaker South African Rand continued throughout
the period, with the Rand averaging ZAR18.69 : US$1 (H1 FY 2023:
ZAR17.32 : US$1)
-- Revenue amounted to US$187.8 million (H1 FY 2023: US$208.5 million)
o As announced on 14 December 2023, like-for-like prices were
down 13.3% compared to H1 FY 2023 sales, with the balance of price
movements attributable to product mix
o No profit share uplifts were effected during the period; H1 FY
2023 revenue includes US$1.4 million from profit share
arrangements
-- Consolidated net debt increased to US$212.3 million as at 31
December 2023 (30 June 2023: US$176.8 million) due to the timing of
closing the Company's sales tenders, the continued lower diamond
pricing environment, working capital funding for the resumption of
mining at Williamson and the increasing capex spend profile, as
previously announced, to extend the life of our operations at
Cullinan Mine and Finsch
Operating Summary
Safety, sales H1 FY 2024 H1 FY 2023
and production
(restated to exclude
Koffiefontein)
Unit Q2 Q1 Total Q2 Q1 Total
--------- --------- --------- --------- --------- ---------
Safety
------ --------- --------- --------- --------- --------- ---------
LTIFR - 0.18 0.12 0.15 0.22 0.16 0.19
------ --------- --------- --------- --------- --------- ---------
LTIs Number 3 2 5 4 3 7
------ --------- --------- --------- --------- --------- ---------
Sales
------ --------- --------- --------- --------- --------- ---------
Diamonds sold Carats 727,189 932,431 1,659,620 788,661 516,308 1,304,969
------ --------- --------- --------- --------- --------- ---------
Revenue(1) US$m 90.2 97.6 187.8 105.7 101.4 207.1
------ --------- --------- --------- --------- --------- ---------
Contribution
from Exceptional
Stones(2) US$m 0.0 0.0 0.0 0.0 0.0 0.0
------ --------- --------- --------- --------- --------- ---------
Production
------ --------- --------- --------- --------- --------- ---------
ROM tonnes Tonnes 2,875,410 2,717,486 5,592,896 2,162,877 2,993,247 5,156,124
------ --------- --------- --------- --------- --------- ---------
Tailings and
other tonnes Tonnes 96,235 91,008 187,243 92,375 94,877 187,252
------ --------- --------- --------- --------- --------- ---------
Total tonnes
treated Tonnes 2,971,645 2,808,494 5,780,139 2,255,252 3,088,124 5,343,376
------ --------- --------- --------- --------- --------- ---------
ROM diamonds Carats 694,884 652,021 1,346,905 602,055 729,761 1,331,816
------ --------- --------- --------- --------- --------- ---------
Tailings and
other diamonds Carats 36,018 44,618 80,636 31,612 29,951 61,563
------ --------- --------- --------- --------- --------- ---------
Total diamonds Carats 730,902 696,639 1,427,541 633,667 759,712 1,393,379
------ --------- --------- --------- --------- --------- ---------
(1) Revenue reflects proceeds from the sale of rough diamonds
and excludes revenue from profit share arrangements (as noted in
the text above)
(2) Petra classifies "Exceptional Stones" as rough diamonds
which sell for US$15 million or more each
INVESTOR WEBCASTS
Webcast presentation for institutional investors and
analysts
09:30am GMT today
Petra's CEO, Richard Duffy, and CFO, Jacques Breytenbach, will
host a webcast for institutional investors and analysts to discuss
this operating update.
Please register at: https://brrmedia.news/PDL_H1FY24OU
Dial in details:
UK-wide +44 (0) 33 0551 0200
UK toll free 0808 109 0700
South Africa toll free 0800 980 512
United States (Local) +1 786 697 3501
09:30am password (if prompted): Petra Diamonds
Link for recording (available later in the day):
https://www.petradiamonds.com/investors/results-reports/
Investor Meet Company webcast at 14.30pm GMT today
Petra's CEO, Richard Duffy, and CFO, Jacques Breytenbach, will
also present these results live on the Investor Meet Company
platform, predominantly aimed at retail investors. To join:
https://www.investormeetcompany.com/petra-diamonds-limited/register-investor
FURTHER INFORMATION
Please contact
Petra Diamonds, London Telephone: +44 207494 8203
Patrick Pittaway investorrelations@petradiamonds.com
Julia Stone
Kelsey Traynor
Financial PR (Camarco)
Gordon Poole Telephone: +44 20 3757 4980
Owen Roberts petradiamonds@camarco.co.uk
Elfie Kent
ABOUT PETRA DIAMONDS
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 (Cullinan Mine, Finsch and
Koffiefontein) and one open pit mine in Tanzania (Williamson). The
Koffiefontein mine is currently on care and maintenance in
preparation for sale or 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.
Corporate and financial summary 31 December 2023
Unit As at 31 December As at 31 December As at 30 June
2023 2022 2023
--------- ------------------ ------------------
Cash at bank
- (including
restricted amounts)(1) US$m 75.4 146.6 61.8
-------------------------- --------- ------------------ ------------------ --------------
Diamond debtors US$m 8.1 4.9 8.9
-------------------------- --------- ------------------ ------------------ --------------
Diamond inventories(2,3) US$m 53.5 59.9 65.9
Carats 483,142 540,153 715,222
------------------------------------ ------------------ ------------------ --------------
2026 US$336.7m
loan notes (4) US$m 249.2 241.7 247.5
-------------------------- --------- ------------------ ------------------ --------------
Bank loans and US$m 46.6 - -
borrowings(5)
-------------------------- --------- ------------------ ------------------ --------------
Consolidated
Net Debt(6) US$m 212.3 90.2 176.8
-------------------------- --------- ------------------ ------------------ --------------
Bank facilities
undrawn(5) US$m 49.2 58.8 53.1
-------------------------- --------- ------------------ ------------------ --------------
Note: The following exchange rates have been used for this
announcement: average for H1 FY 2024 US$1: ZAR18.69 (H1 FY 2023:
US$1: ZAR17.32; FY 2023: US$1: ZAR17.77); closing rate as at 31
December 2023 US$1: ZAR18.28 (31 December 2022: US$1: ZAR17.00, 30
June 2023: US$1: ZAR18.83).
Notes:
1. The Group's cash balances comprise unrestricted balances of
US$56.5 million, and restricted balances of US$18.9 million.
2. Recorded at the lower of cost and net realisable value.
3. Diamond inventories for periods prior to 30 June 2023 include
the Williamson 71,654.45 carat parcel of diamonds blocked for
export during August 2017, with a carrying value of US$12.5
million. Under the Framework Agreement entered into with the
Government of Tanzania (GoT) in December 2021, it is stated that
the proceeds from the sale of this parcel are to be applied to the
Williamson mine to assist with the restart of operations and that
in the event such proceeds are not received by Williamson,
Williamson is not required to pay a US$20 million liability
relating to the settlement of past tax disputes. During
discussions, the GoT confirmed that the blocked parcel was
partially sold during the period and so this parcel has been
excluded from diamond inventories as at 30 June 2023. During these
discussions, the parties also confirmed their intent to resolve how
to treat the blocked parcel sale proceeds and the related US$20
million settlement liability.
4. The 2026 US$336.7 million loan notes, originally issued
following the capital restructuring (the "Restructuring") completed
during March 2021, have a carrying value of US$249.2 million which
represents the outstanding principal amount of US$209.7 million
(after the early participation phase of the debt tender offers as
announced in September and October 2022) plus US$48.2 million of
accrued interest and net of unamortised transaction costs
capitalised of US$8.7 million.
5. Bank loans and borrowings represent the Group's revolving
credit facility, which was increased from ZAR1 billion in December
2023 to ZAR1.75 billion, and is partially undrawn and available.
The upsized portion will be imminently available upon conclusion of
the required amendments.
6. Consolidated Net Debt is bank loans and borrowings plus loan
notes, less cash and diamond debtors.
Mine-by-mine tables:
Cullinan Mine - South Africa
H1 FY 2024 H1 FY 2023
Unit Q2 Q1 Total Q2 Q1 Total
--------- --------- --------- --------- --------- ---------
Sales
------- --------- --------- --------- --------- --------- ---------
Revenue US$m 45.5 51.0 96.5 45.8 56.9 102.7
------- --------- --------- --------- --------- --------- ---------
Diamonds sold Carats 345,867 519,362 865,229 400,999 267,728 668,727
------- --------- --------- --------- --------- --------- ---------
Average price per carat US$ 131 98 112 114 212 154
------- --------- --------- --------- --------- --------- ---------
ROM Production
------- --------- --------- --------- --------- --------- ---------
Tonnes treated Tonnes 1,078,409 1,137,435 2,215,844 1,120,282 1,110,912 2,231,194
------- --------- --------- --------- --------- --------- ---------
Diamonds produced Carats 331,349 318,261 649,610 328,137 368,796 696,933
------- --------- --------- --------- --------- --------- ---------
Grade(1) Cpht 30.7 28.0 29.3 29.3 33.2 31.2
------- --------- --------- --------- --------- --------- ---------
Tailings Production
------- --------- --------- --------- --------- --------- ---------
Tonnes treated Tonnes 96,235 91,008 187,243 62,178 77,572 139,750
------- --------- --------- --------- --------- --------- ---------
Diamonds produced Carats 36,018 44,618 80,636 28,211 26,790 55,001
------- --------- --------- --------- --------- --------- ---------
Grade(1) Cpht 37.4 49.0 43.1 45.4 34.5 39.4
------- --------- --------- --------- --------- --------- ---------
Total Production
------- --------- --------- --------- --------- --------- ---------
Tonnes treated Tonnes 1,174,644 1,228,443 2,403,087 1,182,460 1,188,484 2,370,944
------- --------- --------- --------- --------- --------- ---------
Diamonds produced Carats 367,367 362,879 730,246 356,348 395,586 751,934
------- --------- --------- --------- --------- --------- ---------
Note: 1. Petra is not able to precisely measure the ROM /
tailings grade split because ore from both sources is processed
through the same plant; the Company therefore back-calculates the
grade with reference to resource grades.
Finsch - South Africa
H1 FY 2024 H1 FY 2023
Unit Q2 Q1 Total Q2 Q1 Total
------- ------- --------- ------- ------- ---------
Sales
------- ------- ------- --------- ------- ------- ---------
Revenue US$m 28.1 38.9 67.0 32.0 23.4 55.4
------- ------- ------- --------- ------- ------- ---------
Diamonds sold Carats 298,889 375,214 674,103 283,833 177,285 461,118
------- ------- ------- --------- ------- ------- ---------
Average price per carat US$ 94 104 99 113 132 120
------- ------- ------- --------- ------- ------- ---------
ROM Production
------- ------- ------- --------- ------- ------- ---------
Tonnes treated Tonnes 635,872 544,140 1,180,012 522,578 572,976 1,095,554
------- ------- ------- --------- ------- ------- ---------
Diamonds produced Carats 276,842 259,864 536,706 234,150 260,217 494,367
------- ------- ------- --------- ------- ------- ---------
Grade(1) Cpht 43.5 47.8 45.5 44.8 45.4 45.1
------- ------- ------- --------- ------- ------- ---------
Tailings Production
------- ------- ------- --------- ------- ------- ---------
Tonnes treated Tonnes - - - 30,197 17,305 47,502
------- ------- ------- --------- ------- ------- ---------
Diamonds produced Carats - - - 3,402 3,160 6,562
------- ------- ------- --------- ------- ------- ---------
Grade(1) Cpht - - - 11.3 18.3 13.8
------- ------- ------- --------- ------- ------- ---------
Total Production
------- ------- ------- --------- ------- ------- ---------
Tonnes treated Tonnes 635,872 544,140 1,180,012 552,775 590,281 1,143,056
------- ------- ------- --------- ------- ------- ---------
Diamonds produced Carats 276,842 259,864 536,706 237,552 263,377 500,929
------- ------- ------- --------- ------- ------- ---------
Note: 1. Petra is not able to precisely measure the ROM /
tailings grade split because ore from both sources is processed
through the same plant; the Company therefore back-calculates the
grade with reference to resource grades.
Williamson - Tanzania
H1 FY 2024 H1 FY 2023
Unit Q2 Q1 Total Q2 Q1 Total
--------- --------- --------- ------- --------- ---------
Sales
------- --------- --------- --------- ------- --------- ---------
Revenue US$m 16.6 7.7 24.3 27.9 21.2 49.1
------- --------- --------- --------- ------- --------- ---------
Diamonds sold Carats 82,432 37,856 120,288 103,829 71,295 175,124
------- --------- --------- --------- ------- --------- ---------
Average price per carat US$ 201 203 202 269 297 280
------- --------- --------- --------- ------- --------- ---------
ROM Production
------- --------- --------- --------- ------- --------- ---------
Tonnes treated Tonnes 1,161,129 1,035,911 2,197,040 520,017 1,309,359 1,829,376
------- --------- --------- --------- ------- --------- ---------
Diamonds produced Carats 86,693 73,896 160,589 39,766 100,750 140,516
------- --------- --------- --------- ------- --------- ---------
Grade(1) Cpht 7.5 7.1 7.3 7.6 7.7 7.7
------- --------- --------- --------- ------- --------- ---------
Total Production
------- --------- --------- --------- ------- --------- ---------
Tonnes treated Tonnes 1,161,129 1,035,911 2,197,040 520,017 1,309,359 1,829,376
------- --------- --------- --------- ------- --------- ---------
Diamonds produced Carats 86,693 73,896 160,589 39,766 100,750 140,516
------- --------- --------- --------- ------- --------- ---------
Notes:
1. The following definitions have been used in this announcement:
a. cpht: carats per hundred tonnes
b. LTIs: lost time injuries
c. LTIFR: lost time injury frequency rate, calculated as the
number of LTIs multiplied by 200,000 and divided by the number of
hours worked
d. FY: financial year ending 30 June
e. CY: calendar year ending 31 December
f. H: half of the financial year
g. ROM: run-of-mine (i.e. production from the primary orebody)
h. m: million
i. Mt: million tonnes
j. Mct: million carats
k. 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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