Picture: REUTERS
Picture: REUTERS

State-owned diamond company Alexkor, which operates on the west coast, only has enough operational money to last for the next eight months, board chair Hantsi Matseke said in Parliament Wednesday.

At the end of March the company’s cash reserves stood at R332m, down from R384m at the end of the 2014-15 financial year.

Matseke told the public enterprises portfolio committee that one of the reasons for the cash shortage was the nonreplenishment of its resources from the pooling and sharing joint venture with the Richtersveld community.

Another reason was the poor level of carat production.

The company suffered a R35m loss at the bottom-line in the last financial year, which was nevertheless an improvement on the previous year’s R82m loss. Diamond revenue slid 7% from R414m to R387m.

Matseke said in order to assist with Alexkor’s cash shortage, the board had approved the use of the R45m excess in the allocation in the medium-term expenditure framework, which was earmarked for rehabilitation.

Other funding options were being explored, she added, and measures had also been adopted to contain costs.

About a year ago, Alexkor was exploring the beneficiation of coal as an extra leg of its business but Matseke told MPs that this had been put on the backburner.

Public Enterprises Minister Lynne Brown has asked that Alexkor "exhaust all avenues relating to further investment in diamond projects".

One area to explore was the cutting and polishing of diamonds which Matseke said was "severely lacking" in SA.

© BDlive 2016

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