Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Oct 23 (Reuters) – Petra Diamonds Ltd’s first quarter revenue fell by 17 percent after the government of Tanzania last month seized a consignment of diamonds from its Williamson mine.
The owner of the Cullinan mine in South Africa has been hit by a crackdown on mining firms in Tanzania, where the government is attempting to secure more revenue from the sector.
The Tanzanian government confiscated a consignment of diamonds from the Williamson mine, which is majority-owned by Petra, alleging the company had under-declared the value of the stones by about half.
Petra has denied the charge.
The London-listed company said on Monday its revenue was $78.7 million in the quarter ended Sept. 30, while net debt rose to $614 million, from $555 million as of June 30.
Shares in Petra rose as much as 4 percent, before paring gains to trade up 2.75 percent at 84 pence by 0801 GMT. Petra maintained its full-year production guidance of between 4.8 million carats and 5.0 million carats.
Petra has also faced strikes in South Africa over pay, rent and housing allowances and demands for medical expenses.
(Reporting by Sanjeeban Sarkar in Bengaluru; Editing by Subhranshu Sahu and Alexander Smith).
