Petra Diamonds lender group waives measurements of covenant tests

Petra Diamonds’ lender group has agreed to waive the measurements of the two covenant tests related to consolidated earnings before interest, taxes, depreciation and amortisation to and as at, 31 December.

The group, which includes Absa Bank, FirstRand Bank, IFC and Nedbank, has advised Petra that it remains supportive of the company and its expansion plans.

Petra said it continues to focus on cost control and access to undiluted ore, with the expansion programmes at both Cullinan and Finsch remaining on track.

Taking into account current trading conditions, together with the significant benefit of the weaker rand/US Dollar exchange rate, the company said it remains well financed for the completion of its capital expansion programmes.

In addition, Petra said further increases in production and a reduction in capex from full year 2017 should see the group’s net debt return to lower levels.

Chief executive Johan Dippenaar said: “Petra remains focused on maintaining a healthy balance sheet to enable it to successfully conclude its expansion programmes which remain on track, with the majority of work having already been completed."

At 1547 GMT, Petra shares were up 6.4% at 61.95p.