REG-Petra Diamonds: Sales results for Tender 4 FY 2023

Petra DiamondsAnnouncement

15/03/2023 07:15

FOR IMMEDIATE RELEASE

 15 March 2023   LSE: PDL 

Sales results for Tender 4 FY 2023

Petra achieves US$72.1 million in sales in its fourth tender cycle for FY 2023

Richard Duffy, Chief Executive Officer of Petra Diamonds (Petra), said:

“Petra’s fourth tender for FY 2023 saw a 12.5% increase in
like-for-like 1  prices on Tender 3 FY 2023, confirming the improving trend
observed in the previous tender. We ascribe the positive pricing trends to a
recovery in demand from China as COVID-19 restrictions continue to dissipate,
coupled with a more buoyant outlook from the recent Hong Kong International
Jewellery Show. Stronger demand from major jewellery brands has also supported
prices for smaller goods. Solid demand for coloured stones across all size
ranges was evident in this cycle leading to improved pricing.

We continue to expect a supportive diamond market in the medium to longer-term
as a result of the structural supply deficit. Current levels of demand remain
robust, though we are cognisant of possible near-term volatility owing to
recent geopolitical and macroeconomic uncertainty.”

Petra announces the results of Tender 4 of FY 2023, at which 505,398 carats
were sold for a total of US$72.1 million from Petra’s South African
operations. This cycle includes a US$7 million Exceptional Stone(2) from our
Cullinan Mine and US$4.3 million of Finsch diamonds sold during H1 FY 2023,
both of which were reported in our Interim Results announcement during
February 2023. No sales for Williamson were recorded in this cycle given the
operations at the mine are still suspended.

Rough diamond sales results for the respective periods are set out below:

                                                   Tender 4 FY23 Mar-23  Tender 3 FY23 Dec-22  Variance T3 FY23 vs T4 FY23  Tender 4 FY22 Feb-22  YTD FY 2023 after Tenders 1-4  YTD FY 2022 after Tenders 1-4  
 Diamonds sold (carats)                                   505,398               305,366                    +66%                    735,222                  1,778,051                      2,331,070            
 Sales (US$ million)                                       72.1                  42.3                      +71%                     140.6                     278.5                          405.3              
 Average price (US$/ct)                                     143                   138                      +3%                       191                       157                            174               
 Revenue from Exceptional Stones 2  (US$ million)           7.0                    –                       100%                      5.5                       7.0                            83.4              

 1  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

 2  Petra classifies “Exceptional Stones” as rough diamonds which sell for
US$5 million or more each

Sales

The results of Tender 4 bring FY 2023 YTD revenue from rough diamond sales to
US$278.5 million, including US$7 million from Exceptional Stone sales,
compared to US$405.3 million in the first four tenders of FY 2022, which
included a US$83.4 million contribution from Exceptional Stones. The
comparative fourth tender in FY 2022 closed around the Russian invasion of
Ukraine which saw prices temporarily spike at that specific tender. The lower
volume sold in Tender 4 FY 2023 relative to the equivalent tender last year
was driven by lower production from the South African operations, and no
production from the Tanzanian operation, with Williamson currently suspended
pending the restart planned for Q1 FY 2024.

Mine by mine average prices for the respective periods are set out in the
table below:

 US$/carat      Tender 4  FY23 Mar-23  Tender 3  FY23 Dec-22  Tender 4  FY22 Feb-22  YTD FY 2023 after Tenders 1-4  YTD FY 2022 after Tenders 1-4  FY 2022 12 months to 30 June 2022  
 Cullinan Mine         154 (1)                  116                  180 (1)                    154 (1)                        188 (1)                          169 (1)               
 Finsch                  121                    107                    151                        121                            112                              118                 
 Williamson              n/a                    266                    369                        280                          488 (1)                          384 (1)               
 Koffiefontein           461                    371                    856                        452                            612                              581                 

Note 1: Prices for both Cullinan Mine and Williamson include proceeds from the
sale of Exceptional Stones.

Like-for-like prices

Like-for-like rough diamond prices improved by 12.5% on Tender 3 FY 2023
driven by double-digit increases in all categories, except for the 2 to 5ct
size ranges which increased by some 3.5%. Prices decreased by 11.9% compared
to Tender 4 of FY 2022 reflecting the significant, but temporary, upward price
movements seen at the commencement of the Russian/Ukraine conflict.
Notwithstanding this spike, YTD prices are marginally up by 0.2% compared to
the equivalent four tenders of FY 2022.

Product mix

The balance of price movements  are attributable to product mix, resulting in
an increase at Cullinan Mine, supported by the Exceptional Stone, but downward
price pressure at Finsch in this cycle. Koffiefontein sales comprised the
final 1,927 carats of diamonds recovered prior to steps being taken to place
the mine on care and maintenance.

For further information, please contact:

Petra Diamonds, London                 Telephone: +44 20 7494
8203                                               

Patrick Pittaway                     
            investorrelations@petradiamonds.com

Julia Stone

About Petra Diamonds Limited

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
(Finsch, Cullinan Mine and Koffiefontein) and one open pit mine in Tanzania
(Williamson).

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.



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