Petra Diamonds Limited (LON:PDL) increased production at its mines by 16% during the 12 months to June, helping the firm to post a rise in revenues and beat analysts’ expectations.
Production during the period was up by 16% compared to 2015 to 3.7mln carats, which allowed the FTSE 250-listed miner to generate revenues of US$430.9mln, a year-on-year increase of 1%.
The modest rise was enough to top market expectations, with analysts previously forecasting revenues somewhere around the US$409mln mark.
Petra said the better-than-expected revenues were simply down to producing, and then selling, more diamonds.
“Petra has recorded further strong growth, leading to record production levels for the year and the expectation that the group will reach its long-stated target of ca. 5 Mcts by 2018, a year earlier than anticipated,” said chief executive Johan Dippenaar.
The company added that it was still able to generate higher revenues despite a 6% drop in rough diamond prices compared to the previous year.
Like other commodities, the diamond market has been hit by weaker demand from China, generally one of the precious stone’s key players.
The stronger dollar has also hampered the market, while an excess of polished diamonds have flooded the market, further cutting demand and prices.
Petra added that the market has shown “signs of recovery and stabilisation” in recent months.
Shares were up 2.5p, or 2%, to 122p.