Petra Diamonds cuts targets and costs in tough market

Petra Diamonds (LON: PDL) revised on Thursday its guidance for the next two fiscal years and appointed a new finance leader as […]
Cullinan mine plant. (Image courtesy of Petra Diamonds.)

Petra Diamonds (LON: PDL) revised on Thursday its guidance for the next two fiscal years and appointed a new finance leader as part of its plans lower expenses and debt in a clear sign the diamond market remains in bad shape.

The South African miner had anticipated in December that the sector was beginning to recover. Rather than proving the hopeful prediction, Petra has significantly cut its production targets. It now expects to produce between 2.8 million and 3.1 million carats in fiscal 2025 and between 2.9 million and 3.3 million in fiscal 2026. This represents a reduction of 18% and 19%, respectively, on the prior target-ranges' midpoint.

The company also said it expected total carat recovery to be at the lower end of its target range of 2.74 million to 2.78 million for the current fiscal year.

These downgrades, announced in an investor day presentation, coincide with Petra's plan to reduce operating costs by $30 million annually starting in the fiscal year that end on June 30, 2025. Total capital spending will be reduced to $100 million from $117.1 million in fiscal 2023.

“We have worked hard to deliver an updated business profile in response to ongoing market challenges and to further enhance our resilience to future market and capital cycles,” chief executive Richard Duffy said in a statement.

Petra’s revisions come just a day after the world’s largest diamond producer, De Beers, posted disappointing results for its latest sales for the second time this year. 


Petra announced it had appointment Johan Snyman to take on the role of chief financial officer starting from October 1. Snyman will replace Jacques Breytenbach, who will leave his position as CFO and director at the end of September due to personal reasons. 

“[Snyman] has played a crucial part in the progress of Petra since joining in January, and I am excited to collaborate with him in his new capacity," Duffy said.

The new CFO joined Petra this year as financial controller, having worked as vice president for financial reporting at AngloGold Ashanti. He has also previously held various financial roles in the mining sector.

Expansions unaffected

Petra remains committed to expanding its Finsch and Cullinan mines in South Africa, it said, and it is projecting production to reach between 3.4 to 3.7 million carats by 2028.

Cullinan is Petra’s flagship mine and the source iconic diamonds, including the famed 3,106-carat Cullinan diamond, which was cut to form the 530-carat Great Star of Africa. They are the two largest diamonds in the British Crown Jewels.

Petra finds 39.34-carat blue diamond at Cullinan mine
The Cullinan mine is also a source of rare blue diamonds. (Image of 39.34-carat blue diamond courtesy of Petra Diamonds via X.)

Petra’s planned output increase, equivalent to 15% to 17% over three years, will require about $100 million annually. Duffy stated the plans will be financed internally.

Cullinan mine-life can be potentially extended beyond 2050. Finsch, South Africa’s second largest diamond operation by output, could be producing until around 2040.

Shares in Petra experimented high volatility in London after the announcements and were last down 1.96% to 40p. This leaves the miner with a total market capitalization of £78.63 million (about $100m).


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