Trans Hex slides into red on rand and lower diamond prices
Diamond miner Trans Hex ascribes loss to several factors, including lower gem prices
Diamond miner Trans Hex reported a loss on Thursday, ascribing it to several factors, including lower gem prices.
The net loss was R199.2m in the six months to the end of September, swinging from a profit of R32.5m in the year-earlier period, the company said. Sales revenue from the South African operations fell 45.6% to R149.7m, as the average diamond price dropped 20.1%, mainly due to a weaker market and a decrease in average stone size. A stronger rand and a 22.9% decrease in carats sold also affected sales revenue.
South African production decreased 16.2% to 15,917 carats, mainly due to the closure of Bloeddrif mine and underperformance at Baken mine. Equity accounting loss from West Coast Resources, in which Trans Hex holds a 40% interest, widened to R13.1m‚ from R9m.
Equity accounting profit from its Somiluana mine fell to R18.7m from R34.2m.
Trans Hex expects production in the 2018 financial year to be about 140,000 carats, compared with 2017’s actual production of 80,506 carats.
The market softened for rough and polished stock as margins came under pressure in both the manufacturing and trading sectors, the firm said.
Marginal price increases were expected for the remainder of the calendar year, with prices set to recover towards the start of 2018.
The share price was flat at R2 in early trade on the JSE, having lost 33% in the past two days, following a trading update.
With Staff Writer