Annual Report and Accounts 2013
Petra Diamonds Limited 19
Overview
Performance Review
Strategic Review
Sustainability
Corporate Governance
Group Accounts
US$16.9 million; this equates to a remarkable US$663,144 per carat,
which is possibly one of the highest value per carats ever achieved
for a rough stone.
Blue diamonds are incredibly rare, which only adds to their allure.
Cullinan is the world’s most important source of blues.
The diamond market in FY 2013
Diamond prices
The rough diamond market was stable in FY 2013, with less
volatility than has been experienced over recent years. Petra’s
rough diamond prices were essentially flat during H1 of FY 2013,
whilst firmer prices were seen during H2.
Petra expects prices to remain stable for FY 2014, with the
potential for pricing upside, due to constrained supply and
a firmer US market, the world’s major market for polished
diamonds, as well as continued growth in China, albeit at a
lower rate than over recent years. Recent economic data for
the luxury goods sector suggests robust demand in most major
markets, as well as some indicators of green shoots in Europe.
Prices achieved for FY 2013 were largely in line with Petra’s
guidance for the Year and the Company’s guidance pricing for
FY 2014, as published on 12 August 2013, is listed below. This
price guidance excludes revenue from ‘exceptional diamonds’
(+US$5 million stones). Taking into account variation from year
to year, on an average annual basis such stones have added
in excess of US$16 million per annum over the last five years.
Petra’s focus on optimising recoveries is evident in the number
of special diamonds sold, with the majority coming from Cullinan
as usual. The Company sold 13 stones exceeding US$1 million
each during the Year, for total revenue of US$39.5 million
(FY 2012: eight stones valued at US$14.4 million).
The most valuable Petra diamond in FY 2013 was an exceptional
25.5 carat blue diamond from Cullinan (pictured right), which sold for
Despite some volatility, the upward trend
in diamond pricing is firmly in place.
ACTUAL ROUGH DIAMOND PRICES FOR THE YEAR AND GUIDANCE PRICING FOR FY 2014
Mine
Guidance
weighted
average
1
US$/ct
FY 2014
Actual
weighted
average
1
US$/ct
FY 2013
Actual
weighted
average
1
US$/ct
FY 2012
Finsch
113
2
120
138
Cullinan
139
163
3
128
Koffiefontein
518
471
487
Kimberley Underground
301
295
320
Helam
145
140
4
255
4
Williamson
254
254
236
1. The weighted average prices are the average of the mix of ROM and tailings production, as Petra tenders production from each mine on a mixed ROM/tailings parcel basis.
2. The average expected value at Finsch is guided lower due to the increase in recovery of smaller diamonds as noted on page 36.
3. The FY 2013 average value at Cullinan includes the 25.5 carat blue diamond sold for US$16.9 million; the average value for FY 2013 excluding this stone was US$142 per carat.
4. Prior guidance and actual results relate to the ‘Fissure Mines’ as a combined business unit, whereas FY 2014 relates to the Helam mine only, as Sedibeng and Star are both
now on care and maintenance.
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