Petra Diamonds raises full-year guidance as market stabilises

Diamond mining group Petra Diamond has raised production guidance from 3.2m to 3.3m carats for the 12 months to 30 June.

The Jersey-based group saw first-half revenue rise 16% year-on-year to $214.8m (£138.9m), while profit before tax grew from $46m to $57.6m.

“Our expansion programmes are on track at all operations, and production is expected to grow to about 3.3m carats in 2015 and to about 5m carats by financial year 2019,” said Johan Dippenaar, the group’s chief executive.

Net debt at the end of 2014 declined 58% to $45.8m from the corresponding period in 2013 and the company said that full-year revenue will be weighted towards the second half.

In a statement released on Thursday, the FTSE 250 group added that while concerns continued to weigh on the sector, it had seen encouraging signs.

"While the diamond market remains under pressure, there are encouraging signs that we are seeing a stabilisation in market conditions, as evidenced by good demand levels at our first tender in the second half of 2015,” said Dippenaar.

“Our continued growth trajectory and robust financial position places Petra in a good position to capitalise on the attractive medium- to long-term fundamentals for our industry."

Analysts at FinnCap said results were in line with expectations and maintained their full-year forecast on the stock.

“As usual, we expect the second-half numbers to be considerably higher than these numbers as the sales schedule is skewed to the second half,” they said in a note.

Petra Diamonds shares were up 3.31% to 180.90p at 09:28 on Thursday.