Petra posted revenue of $295.8 million in the 2020 fiscal year, compared to $463.6 million in FY 2019.
Petra, which has three diamond mines in South Africa and one in Tanzania, said covid-19 affected production, sales and prices.
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.
The global spread of covid-19 and consequent demand drop contributed to a 58% year-on-year decrease in Petra’s earnings before interest, taxes, depreciation and amortisation (Ebitda), to $64.8-million in the reporting year.
The adjusted Ebitda margin also worsened to 22%, compared with 33% in the prior financial year.
In terms of output, Petra churned out 3.59 million carats of diamonds for the year, a 7% fall compared to the 3.87 million carats it mined in 2019.
The diamond miner was already struggling before the pandemic hit — it suffered a loss of $258.1 million last year and its shares have continuously fallen, trading on Tuesday afternoon at just 1.64 pence from around 130p at the start of 2017.
More bad news
The company’s weak financial position pushed it put itself up for sale in June. Petra changed its mind in October, opting instead for a debt-for-equity restructuring. The deal would leave existing shareholders with just 9% of the company.
On top of empty coffers, Petra is also dealing with allegations of human rights abuses at its Williamson mine in Tanzania resulting from the actions of its security guards.
The company has hired an external consultancy to assess the claims. It noted the investigation would be completed by the end of 2020 and that the mine, which it closed in April, remains suspended.
As a result, production during the first quarter of financial year 2021 (July-Sept. 2020) is down 10% to 974,346 carats from the same period in the previous year.
Revenue, however, has jumped by 33% to $82 million owing to the release of inventory carried over from the preceding quarter.
Despite the numerous challenges, Petra is targeting a ramp-up to pre-covid-19 production levels. For now, it’s keeping a lead on production targets for 2021 as a ramping second coronavirus wave has keeps markets guessing.
