Petra Diamonds cuts forecasts, jobs amid market weakness, softer prices

Africa-focused Petra Diamonds (LON: PDL) has lowered its 2025 price forecasts and announced job cuts across group operations and South African support functions to cut costs and improve cash flow amid global diamond market challenges.

The restructuring will be led by Vivek Gadodia, appointed chief restructuring officer. The company has postponed refinancing plans until 2025 to focus on cash generation. “We remain confident in a successful refinancing (…) and will provide further updates with our interim results in February,” chief executive officer Richard Duffy said in a statement.

The company’s move comes only days after De Beers, the world’s largest diamond producer by value, cut the prices of its mined gems by more than 10%.

Petra’s third tender for the 2025 financial year delivered mixed results. While sales volumes rose, both revenue and prices declined. The company sold 700,803 ct. during the third tender, a 17% increase compared to the combined 600,161 ct. sold in the first two tenders.

The Cullinan mine’s third tender had an average price of US$100 per carat. This is down from US$146 per ct. in earlier tenders but slightly above the 2024 financial year’s year-to-date average of US$112 per carat.

At the Finsch mine, the average price fell to US$72 per ct. from US$84 per ct. in earlier tenders, below the year-to-date average of US$99 per ct. in 2024.

Meanwhile, the Williamson mine improved slightly. The average price was US$174 per ct. in the third tender, up from US$164 in earlier tenders. However, it was still below last year’s US$202 per ct. average.

Challenging market

In light of softer market conditions, Petra has revised its pricing assumptions for the 2025 financial year. Cullinan mine forecasts are now US$120 to US$130 per carat. The Finsch and Williamson mines’ are US$80-US$90 and US$170-US$200 per ct., respectively.

Year-to-date, like-for-like diamond prices are down 10% vs. 2024. Weaker demand for smaller diamonds is the main cause. Sales revenue for the third tender fell 7% to US$71 million. Year-to-date revenue is US$146 million, down from US$188 million last year. The average diamond price for the third tender was US$101 per ct., a significant drop from US$126 per ct. in the first two tenders of the financial year.

Petra noted that diamond prices depend on market conditions. It will monitor the situation as it works to stabilize its operations.

In September, Duffy said the company expected better conditions in 2025. Increased discipline among diamond producers should help re-balance inventory levels across the supply chain.