[miningmx.com] — JUNIOR diamond miner Petra Diamonds (Petra) said it was in talks with De Beers to buy the diamond group’s Finsch and Namaqualand mines in South Africa.
Petra’s CEO Johan Dippenaar confirmed a Miningmx report in July that the company was assessing whether to bid for more assets from De Beers having already bought Kimberley underground mine and a stake in De Beers’ Cullinan operation.
Dippenaar was commenting after announcing record profits of $70.2m for Petra in the year ended June, an impressive turnaround from the $89m loss reported in the previous financial year.
“This has been an exceptional year for Petra, in which we have delivered the financial results of our superior growth profile, following the downturn experienced by all commodities groups in 2009,” said Dippenaar.
The company presented its unaudited annual results on Friday, which beat analysts’ expectations, posting a turnaround profit from mining activity of $67.2m from $7.87m in 2009, while group revenue rose to $163.7m from $69.3m before.
Petra expected diamond prices to be firmer for the 2011 financial year should the market and global economy remain stable.
Extensive growth plans were on the cards to more than double production by 2014 and push production three times higher come 2019.
Demand from the US, which makes up about half of the global diamond jewellery market, had improved Dippenaar said.
Consumption from China and India was expected to continue to grow and would also be supported by rising diamond content in jewellery as those markets develop.
The company had raised $120m in an equity programme and increased its ownership in the Cullinan mine from 37% to 74%. It also agreed new debt facilities of $78m with IFC and Rand Merchant Bank and completed the acquisition of Kimberley Underground mine.
“Petra’s strategy is to continue to steadily increase rough diamond production and develop our stature as an important supplier to the world market,” said Dippenaar.
The group expects to produce about 1.3 million carats in the current financial year.
