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Petra Diamonds reports annual net loss, revenue fall as pandemic bites

·1-min read
FILE PHOTO: A visitor holds a 17 carat diamond at a Petra Diamonds mine in Cullinan
FILE PHOTO: A visitor holds a 17 carat diamond at a Petra Diamonds mine in Cullinan

JOHANNESBURG (Reuters) - Petra Diamonds <PDL.L> on Tuesday reported a 36% fall in revenue and a net loss of $223 million (168.7 million pounds) as the pandemic hit production, sales and prices.

Petra, which operates three diamond mines in South Africa and one in Tanzania, kept production guidance for 2021 on hold due to ongoing uncertainty, noting the risks to production if further COVID-19 restrictions are required.

CEO Richard Duffy said Petra had "unprecedented challenges" to contend with in 2020.

The diamond miner was already struggling before the pandemic hit - it suffered a loss of $258.1 million last year and its shares have sunk to just 1.6 pence from around 130p at the start of 2017.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) fell 58% to $64.8 million on revenue down 36% to $295.8 million for the year ended June 30.

It reported a cash outflow of $12.3 million versus free cashflow of $70.5 million last year, and took an impairment charge of $91.9 million due to reduced diamond pricing estimates.

Petra last month agreed a debt-for-equity restructuring with debt holders which will leave existing shareholders with just 9% of the company.

Although the diamond market has been improving, the resurgence of COVID-19 in key markets poses a threat to the nascent recovery, Petra said, with much resting on consumer activity in the U.S. market in coming months.

Petra's Williamson mine in Tanzania closed in April and remains suspended.

(Reporting by Helen Reid; editing by Louise Heavens and Jason Neely)