The Koffiefontein mine in South Africa

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Highlights

Highlights for the year ended 30 June 2011

Financial Highlights

  • Revenue: US$220.6 million (FY 20101: US$163.7 million)
  • Profit from mining activity2: US$76.4 million (FY 2010: US$67.2 million)
  • Operating cashflow: US$50.6 million (FY 2010: US$48.8 million)
  • EBITDA3: US$67.1 million (FY 2010: US$70.9 million); FY 2010 included a profit of ca. US$35 million due to the sale of the 507 carat Cullinan Heritage diamond
  • Profit after tax: US$59.2 million (FY 20101: US$70.2 million)
  • EPS4: 12.83 cents per share, post the issue of 136,698,212 new shares in January 2011 (FY 2010: 22.65 cents per share)
  • Cash at bank at 30 June 20115: US$324.9 million (FY 2010: US$34.5 million)

Operations Highlights

  • Production of 1,117,795 carats (FY 2010: 1,164,856)
  • Expansion plans on target to increase production to over 5 Mcts by FY 2019
  • Sound cost control despite inflationary pressures
  • Diamond prices rose steadily from October 2010 to highs in June 2011; since July 2011, rough prices have adjusted downwards and economic uncertainty may continue to cause volatility in the short term

Corporate Highlights

  • Acquisition of world-class Finsch mine for R1.425 billion (ca. US$192 million) completed post year-end on 14 September 2011
  • Equity fundraising of US$325 million to fund Finsch acquisition and strengthen Company balance sheet
  • US$83 million debt facilities in place with IFC and Rand Merchant Bank

Outlook

  • After an initial bedding down period, Finsch is expected to add ca. 125,000 carats per month to Petra’s output, adding at least 1 Mcts for FY 2012
  • The Group gross resources (including Finsch) has increased to over 300 Mcts
  • London Stock Exchange Main Market step-up expected by end December 2011
  • Long-term outlook for diamond market remains positive due to strong supply and demand fundamentals

Notes

  1. For the Period 1 July to 16 November 2009, Petra accounted for its interest in Cullinan under the gross method of proportional consolidation, recognising 50% of revenue and 13% minority interests. With effect from 17 November 2009, the effective date of control for accounting purposes that Petra acquired the remaining 50% interest in Cullinan Investment Holdings Limited from Al Rajhi Holdings W.L.L., Petra consolidates 100% of revenue and 26% minority interests in line with IFRS.
  2. Stated before impairments, depreciation, amortisation, share based expense, foreign exchange gains, interest paid, inventory fair value adjustment and deferred taxation on inventory fair value adjustment.
  3. EBITDA disclosures are “adjusted EBITDA”, being stated before impairments, share based expense, foreign exchange gains and recycling of foreign exchange differences on exploration projects.
  4. Stated after non-controlling interests (representing black economic empowerment partners’ interests in the Group) of US$6.0 million (FY 2010: US$6.7 million).
  5. Cash at bank comprises unrestricted cash and restricted cash balances of US$96.9 million and US$228 million respectively (30 June 2010: US$24.8 million and US$9.7 million). The restricted balance of US$228 million as at 30 June 2011 included the consideration held in escrow for the acquisition of Finsch, which completed post the end of FY 2011.