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Petra Diamonds annual profit misses estimates on tepid diamond market
[BENGALURU] Petra Diamonds reported on Monday a 22 per cent fall in its annual profit, missing estimates, as the miner grappled with a sluggish diamond market, dented partly by the Sino-US trade friction and Hong Kong protests.
Adjusted core profit fell to US$153.0 million in the year ended June 30 from US$195.4 million a year earlier, compared with analysts' average expectations of US$172 million, according to company-compiled consensus of seven estimates.
"More recent unrest in Hong Kong, escalating trade tensions between the US and China, and concerns regarding growth in some of the world's leading economies are further headwinds facing the diamond market in the short-term," the diamond miner said in a statement.
Petra produced 3.87 million carats, in line with forecasts, with annual realised diamond prices down 5 per cent.
The company, which has been trying to revive its flagship Cullinan mine, said its net debt adjusted for diamond debtors stood at US$541 million, as of June 30.
The diamond miner cut its capital expenditure forecast for 2020 to US$43 million, nearly US$29 million lower than its previous outlook. Operational cash flow in 2019 was positive at US$70.5 million compared with outflows last year.
Net loss after tax came in at US$258.1 million, including a non-cash impairment charge of US$246.6 million, due to weak prices of rough diamonds.
Non-Executive Chairman Adonis Pouroulis intends to step down from the board by the end of the third quarter 2020, once a successor has been identified and appointed, Petra said.