TIDMPDL
Correction to the Key operational guidance metrics' table in respect of Cash
on-mine costs and G&A for H1 FY23A and H2 FY23E
21 February 2023 LSE: PDL
Petra Diamonds Limited
Interim results for the six months ended 31 December 2022
H1 in line with expectations; annual production on track to increase by c.1 Mct
in FY 2025
Petra Diamonds Limited ("Petra" or the "Company" or the "Group") announces its
unaudited interim results for the six months ended 31 December 2022 (the
"Period", "H1 FY 2023", or "H1").
Richard Duffy, Chief Executive Officer at Petra Diamonds commented:
"Petra's new culture and ongoing focus on continuous improvement through our
operating model has enabled the Company to respond swiftly and efficiently to
the operational challenges experienced in H1 FY 2023.
We are optimistic that the fundamentals of the diamond market will continue to
support prices, with demand for luxury goods remaining robust in the USA,
notwithstanding recent economic volatility. We also expect that the ending of
lock-down restrictions in China will benefit diamond pricing in the near to
medium term.
We remain on track to meet recent production guidance, while our cost guidance
remains largely unchanged despite inflationary pressures as a result of our
ongoing focus on costs, supported by a weaker Rand. Both the Finsch & Cullinan
Mines have a significant resource base giving them potential for long lives,
and our projects at both mines continue to progress in line with expectations.
As a result, our guidance shows annual production increasing by c.1 million
carats from 2.8 million carats in FY 2023 to 3.6 - 3.9 million carats in FY
2025. Production will be further boosted from the recently approved C-Cut
extension at the Cullinan Mine, set to deliver a total of 2.3 million
additional carats from FY 2025 through to FY 2033.
At Williamson, we have made considerable progress in addressing the social and
environmental impact of the tailings storage facility wall breach. The
necessary permits are being put in place, with production anticipated to resume
during Q1 FY 2024. Ahead of this resumption, maintenance is being accelerated
and waste stripping is being carried out to construct the interim tailings
storage facility and to enable an efficient ramp-up in production.
Koffiefontein has been loss making for a number of years and incurred an
operating loss of US$8.7 million in H1. We are taking important steps towards
responsible closure in discussion with all relevant stakeholders.
Revenue for the half year decreased from US$264.7 million in H1 FY 2022 to
US$212.1 million, with the strength of our product mix and an increase in
like-for-like diamond prices of 12.6% helping to offset lower production and no
contribution from Exceptional Stones[1] (H1 FY 2022: US$77.9 million).
Post period-end, two blue diamonds recovered from the Cullinan Mine, including
an Exceptional Stone, were sold into partnership. The 17.4 and 10.4 carat gem
quality blue diamonds were sold for US$7 million and US$2 million respectively.
We will share equally in any upside on the sale of the stones once cut and
polished, extending our partnership approach on selected diamonds."
[1] Petra classifies "Exceptional Stones" as rough diamonds which sell for US$5
million or more each
Summary of financial results
US$m unless stated otherwise H1 FY 2023 H1 FY 2022 FY 2022
Revenue 212.1 264.7 585.2
Revenue from rough diamond sales 210.7 264.7 584.1
Average realised price per carat 160 166 165
Adjusted mining and processing costs 130.4 109.8 307.1
Adjusted EBITDA1 77.4 150.9 264.9
Adjusted EBITDA margin1 36% 57% 45%
Adjusted profit before tax1 18.9 91.1 141.9
Adjusted net profit after tax1 4.5 66.4 102.0
Net (loss) / profit after tax (17.6) 49.1 88.1
Adjusted basic (loss) / earnings per (0.91) 29.01 42.93
share1 (USc)
Basic (loss) / earnings per share (USc) (12.23) 22.29 35.53
Capital expenditure 51.9 16.7 52.2
Operational free cash flow1 11.7 122.4 230.0
Consolidated net debt1 90.2 152.3 40.6
Unrestricted cash 130.4 256.7 271.9
Consolidated net debt : Adjusted EBITDA1 0.47x 1.0x 0.15x
Note 1: For all non-GAAP measures refer to the Summary of Results table within
the Financial Results section below.
* Revenue amounted to US$212.1 million (H1 FY 2022: US$264.7 million),
including US$1.4 million from Petra's realised profit share from
partnership stones
* The average realised price per carat in H1 FY 2023 was US$160/ct down 3% to
US$166 in H1 FY 2022 and US$165/ct for FY 2022
* Adjusted mining and processing costs remained within expectations despite
inflationary pressures. The increase was largely attributable to diamond
inventory movement while cash on mine cost remained largely flat
* Adjusted EBITDA 49% lower YoY, due to the lack of contribution from
Exceptional Stones (US$64 million at Cullinan Mine and US$13.9 million at
Williamson Mine in the prior period), together with lower sales volumes
* Basic loss per share from continuing operations of USc12.23 per share and
USc0.91 on an adjusted basis after accounting for non-controlling interests
* Capex increased to US$51.9 million (H1 FY 2022: US$ 16.7 million) largely
due to the planned capital expenditure relating to expansion projects at
the Cullinan and Finsch Mines, coupled with accelerated equipment
replacement at Finsch
* Operational free cash flow down to US$11.7 million on the back of reduced
sales and the planned increase in capital expenditure relating to expansion
projects
* Further strengthening of the Balance Sheet:
+ Unrestricted cash decreased by US$141.5 million to US$130.4 million
following the successful repurchase of Loan Notes totaling US$146.1
million
+ Consolidated net debt increased to US$90.2 million from US$40.6 million
as at 30 June 2022, with Consolidated net debt : Adjusted EBITDA at
0.47x compared with 0.15x at 30 June 2022
Safety and operational performance
Unit H1 FY 2023 H1 FY 2022 Variance FY 2022
Lost time injury frequency rate 0.19 0.18 6% 0.23
(LTIFR)
Lost time injuries (LTIs) 7 7 0% 15
Gross ore processed Mt 5.4 5.6 -4% 11.7
Gross diamonds recovered Carats 1,399,749 1,777,424 -21% 3,353,670
Gross diamonds sold Carats 1,312,900 1,595,581 -18% 3,536,316
Updates on Williamson
Tailings storage facility (TSF) wall breach
* Financial: As a result of the TSF wall breach, a US$5.9 million remediation
charge is reflected in the profit and loss statement (after Adjusted NPAT).
Approximately US$1.5 million of this amount was incurred up to 31 December
2022, with the balance accrued for at period-end and is expected to be
incurred during H2 FY 2023.
* Environment, Local Community, Technical and Production: We continue to make
good progress with regards to the environmental, social and economic impact
evaluation and remediation process, with humanitarian relief remaining in
place for those affected. The geotechnical evaluation to establish the root
cause of the subsidence that caused the breach is underway, with operations
anticipated to restart using an interim TSF in Q1 FY 2024. More detailed
information regarding these processes and assessments is available on our
website: https://www.petradiamonds.com/our-operations/our-mines/williamson/
tailings-storage-facility-breach/
Blocked diamond parcel
* Under the Framework Agreement entered into by the Government of Tanzania
("GoT"), the Company and Williamson Diamonds Limited ("WDL") in December
2021, the GoT agreed to allocate the proceeds of the confiscated diamond
parcel of 71,654.45 carats ("Blocked Parcel") to WDL. It has come to our
attention that a portion of the Blocked Parcel has recently been sold. We
are engaging with GoT to confirm the application of the proceeds. More
information on the history of the Blocked Parcel can be found on our
website: Petra Diamonds | Blocked Diamond Parcel - Petra Diamonds
Independent Grievance Mechanism and community projects at Williamson
* The Independent Grievance Mechanism (IGM), a non-judicial process to
address the historical allegations of human rights abuses at Williamson
became operational in November 2022 and is now in its pilot phase. The
pilot phase will involve the award of remedy to those determined to have
suffered severe human rights impacts whilst allowing for the IGM's systems
and procedures to be further developed to take into account the learnings
of the pilot phase. More detailed information on the IGM and the
Restorative Justice Projects being put in place to provide sustainable
benefits to the communities located around the mine can be found on our
website: https://www.petradiamonds.com/our-operations/our-mines/williamson/
allegations-of-humanrights-abuses-at-the-williamson-mine/
Outlook
Actions taken to strengthen our business and improve cash flow generation,
together with our capital discipline, means that Petra is well placed to take
advantage of the supportive diamond market fundamentals. Our projects remain on
track to deliver a c.1Mct annual increase in FY 2025, with work commencing on
the C-cut extension to unlock a further 2.3Mct from FY 2025 through to FY 2033,
as we continue to develop the long term potential of our resource base. We
remain confident that we will continue to generate sufficient cash to fund
capex and allow further deleveraging. The Company will consider the payment of
a FY 2023 dividend when finalising its year end results.
Key operational guidance metrics1,2
Unit H1 FY23A H2 FY23E FY23E FY24E FY25E
Total carats Mcts 1.4 1.35 - 1.45 2.75 - 2.85 3.0 - 3.3 3.6 - 3.9
recovered
Cash on-mine costs US$m 140.93 140 - 160 280 - 300 280 - 300 280 - 300
and G&A2
Expansion capex2 US$m 38.2 59 - 62 92 - 104 117 - 129 110 - 125
Sustaining capex2 US$m 13.7 26 - 28 35 - 39 31 - 36 25 - 28
Note 1: Production guidance revised in January 2023 to reflect the revised
grade outlook at Cullinan Mine, a challenging H1 2023 at Finsch and temporary
closure at Williamson
Note 2: Real amounts stated in FY 2023 money terms using 6% CPI. US$ amounts
converted at exchange rate of USD1:ZAR17 apart from H1-FY23 converted at
exchange rate of USD1:ZAR17.32.
Note 3: Cash on-mine costs and G&A (H1 FY 23a) comprises Cash on-mine costs
US$128.4m, Group technical, support and marketing costs US$7.1m and Adjusted
corporate overhead US$5.4m
More detailed guidance is available on Petra's website at: https://
www.petradiamonds.com/investors/analysts/analyst-guidance/
PRESENTATION DETAILS
Richard Duffy, CEO, Jacques Breytenbach, CFO, will present the results to
investors and analysts.
Online and in person at 9.30am GMT
In-person: Storey Club, 100 Liverpool St, Broadgate, London EC2M 2AU
Webcast: To join https://stream.brrmedia.co.uk/broadcast/
63ece9ed46729d09e3663d62
Dial in details:
· Johannesburg, toll/tollfree: +27 (0) 0800 980 512
· UK: +44 (0)33 0551 0200
· USA local: +1 786 697 3501
Password: Quote "Petra Diamonds Interim Results" when prompted by the operator
Recording of presentation
A recording of the webcast will be available later today on Petra's website at
https://www.petradiamonds.com/investors/presentations
Investor Meet Company presentation at 2pm GMT
Petra will present the results on the Investor Meet company platform,
predominantly aimed at retail investors. To join: https://
www.investormeetcompany.com/petra-diamonds-limited/register-investor
FURTHER INFORMATION
Petra Diamonds, London +44 207 494
8203
Patrick Pittaway
investorrelations@petradiamonds.com
Julia Stone
About Petra Diamonds Limited
Petra Diamonds is a leading independent diamond mining group and a supplier of
gem quality rough diamonds to the international market. The Group's portfolio
incorporates interests in three underground mines in South Africa (Finsch,
Cullinan Mine and Koffiefontein) and one open pit mine in Tanzania
(Williamson).
Petra's strategy is to focus on value rather than volume production by
optimising recoveries from its high-quality asset base in order to maximise
their efficiency and profitability. The Group has a significant resource base
which supports the potential for long-life operations.
Petra strives to conduct all operations according to the highest ethical
standards and only operates in countries which are members of the Kimberley
Process. The Group aims to generate tangible value for each of its
stakeholders, thereby contributing to the socio-economic development of its
host countries and supporting long-term sustainable operations to the benefit
of its employees, partners and communities.
Petra is quoted with a premium listing on the Main Market of the London Stock
Exchange under the ticker 'PDL'. The Group's loan notes due in 2026 are listed
on the Irish Stock Exchange and admitted to trading on the Global Exchange
Market. For more information, visit www.petradiamonds.com.
FINANCIAL RESULTS
SUMMARY RESULTS (unaudited)
6 months to 31 6 months to 31 Year ended 30
December 2022 December 2021 June 2022
("H1 FY 2023") ("H1 FY 2022") ("FY 2022")
US$ million US$ million US$ million
Revenue 212.1 264.7 585.2
Adjusted mining and processing costs1 (130.4) (109.8) (307.1)
Other direct income 0.6 0.3 (0.8)
Adjusted profit from mining activity2 82.3 155.2 277.3
Other corporate income 0.5 0.6 0.6
Adjusted corporate overhead3 (5.4) (4.9) (13.0)
Adjusted EBITDA4 77.4 150.9 264.9
Depreciation and Amortisation (37.2) (43.5) (85.3)
Share-based expense (0.9) (0.1) (1.1)
Net finance expense8 (20.4) (16.2) (36.6)
Adjusted profit before tax 18.9 91.1 141.9
Tax expense (excluding taxation credit (14.4) (24.7) (39.9)
on unrealised foreign exchange gain /
(loss))5
Adjusted net profit after tax6 4.5 66.4 102.0
Impairment (charge) / reversal - (3.8) 0.1 19.6
operations and other receivables7
Transaction costs and acceleration of (9.0) - -
unamortised costs on partial redemption
of Notes8
Williamson tailings facility - (5.9) - -
remediation costs
Williamson tailings facility - (5.2) - -
accelerated depreciation
Recovery of fees relating to - 0.2 0.8
investigation and settlement of human
rights abuse claims
Net unrealised foreign exchange gain / 1.6 (28.7) (36.5)
(loss)
Taxation credit on unrealised foreign 0.2 11.1 2.2
exchange gain / (loss)4
Net (loss) / profit after tax (17.6) 49.1 88.1
Earnings per share attributable to
equity holders of the Company -
US cents
Basic (loss) / profit per share (12.23) 22.29 35.53
Adjusted (loss) / profit per share9 (0.91) 29.01 42.93
As at 31 As at 31
December 2022 December 2021 As at
30 June 2022
(US$ million) (US$ million)
Unit (US$
million)
Cash at bank - (including US$m 146.6 272.3 288.2
restricted amounts)
Diamond debtors US$m 4.9 0.4 37.4
Diamond inventories14 US$m 59.9 79.6 52.7
/Cts 540,153 819,252 453,380
Loan notes (issued March 2021) US$m 241.7 346.4 366.2
10
Bank loans and borrowings11 US$m - 78.6 -
Consolidated net debt12 US$m 90.2 152.3 40.6
Bank facilities undrawn and US$m 58.8 0.6 61.5
available11
Consolidated net debt : 0.47x 1.0x 0.15x
Adjusted EBITDA (rolling twelve
months)
The following exchange rates have been used for this announcement: average for
H1 FY 2023 US$1:ZAR17.32 (H1 FY 2022: US$1: ZAR15.03, FY 2022: US$1:ZAR15.22);
closing rate as at 31 December 2022 US$1:ZAR17.00 (31 December 2021 US$1:
ZAR15.99, 30 June 2022: US$1:ZAR16.27).
Notes:
The Group uses several non-GAAP measures above and throughout this report to
focus on actual trading activity by removing certain non-cash or non-recurring
items. These measures include adjusted mining and processing costs, profit from
mining activities, adjusted EBITDA, adjusted net profit after tax, adjusted
earnings per share, adjusted US$ loan note, and consolidated net debt for
covenant measurement purposes. As these are non-GAAP measures, they should not
be considered as replacements for IFRS measures. The Group's definition of
these non-GAAP measures may not be comparable to other similarly titled
measures reported by other companies. The Board believes that such alternative
measures are useful as they exclude one-off items such as the impairment
charges and non-cash items to provide a clearer understanding of the underlying
trading performance of the Group.
1. Adjusted mining and processing costs are mining and processing costs
stated before depreciation.
2. Adjusted profit from mining activities is revenue less adjusted mining
and processing costs plus other direct income.
3. Adjusted corporate overhead is corporate overhead expenditure less
corporate depreciation, tender offer transaction costs and share-based expense.
4. Adjusted EBITDA is stated before depreciation, amortisation of
right-of-use asset, share-based expense, net finance expense, tax expense,
impairment reversal/(charges), expected credit loss release/ (charge), recovery
of fees relating to investigation and settlement of human rights abuse claims,
Williamson tailings facility remediation costs and accelerated depreciation and
unrealised foreign exchange gains and (losses).
5. Tax expense is the tax expense for the Period excluding taxation credit
on unrealised foreign exchange gain/(loss) generated during the Period; such
exclusion more accurately reflects resultant adjusted net profit.
6. Adjusted net profit after tax is net profit after tax stated before
impairment (charge)/reversal, Williamson tailings facility remediation costs
and accelerated depreciation, recovery of fees relating to investigation and
settlement of human rights abuse claims net unrealised foreign exchange gains
and losses, and excluding taxation credit on net unrealised foreign exchange
gains and losses and excluding taxation credit on impairment charge.
7. Impairment charge of US$3.8 million (30 June 2022: US$19.6 million
reversal and 31 December 2021: US$0.1 million reversal) was due to the Group's
impairment review of its operations and other receivables. Refer to note 15 for
further details.
8. Transaction costs and acceleration of unamortised costs on partial
redemption of Notes comprise transaction costs of US$0.8 million included
within Corporate expenditure (refer to note 5) and US$8.2 million in respect of
the redemption premium and acceleration of unamortised costs included within
Finance expense (refer to note 6).
9. Adjusted EPS is stated before impairment charge, gain on extinguishment
of Notes net of unamortised costs, acceleration of unamortised costs on Notes,
Williamson tailings facility remediation costs and accelerated depreciation,
recovery of fees relating to investigation and settlement of human rights abuse
claims, and net unrealised foreign exchange gains and losses, and excluding
taxation credit on net unrealised foreign exchange gains and losses.
10. The 2026 US$336.7 million loan notes, originally issued following the
capital restructuring (the "Restructuring") completed during March 2021, have a
carrying value of US$241.7 million (30 June 2022: US$366.2 million) which
represents the outstanding principal amount of US$210.2 million (after the
early participation phase of the debt tender offers as announced in September
and October 2022) plus US$43.0 million of accrued interest and net of
unamortised transaction costs capitalised of US$11.5 million. Refer to Note 8
for further detail.
11. Bank loans and borrowings represent the Group's ZAR1 billion (US$58.8
million) revolving credit facility which remains undrawn and available.
During the FY2022, the South African banking facilities held with the Group's
previous consortium of South African lenders were settled and cancelled,
comprising of the revolving credit facility of ZAR404.6 million (US$24.9
million) (capital plus interest) and the term loan of ZAR893.2 million (US$54.9
million) (capital plus interest).
12. Consolidated Net Debt is bank loans and borrowings plus loan notes, less
cash and less diamond debtors.
13. Operational free cashflow is defined as cash generated from operations
less cash outflows on the acquisition of property, plant and equipment.
14. Diamond inventory includes the 71,654.45 carat parcel of diamonds
blocked for export during August 2017, with a carrying value of US$12.5
million. In terms of the framework agreement reached with the Government of
Tanzania, as announced on 13 December 2021, the proceeds from the sale of this
parcel will be allocated to Williamson. During February 2023, it has come to
our attention that a portion of the Blocked Parcel has been sold. We are
engaging with GoT to confirm the application of the proceeds.
Revenue
H1 FY 2023 amounted to US$212.1 million (H1 FY 2022: US$264.7 million),
comprising revenue from rough diamond sales of US$210.7 million (H1 FY 2022:
US$264.7 million) and additional revenue from profit share agreements of US$1.4
million (H1 FY 2022: US$nil).
H1 FY 2023 revenue from rough diamond sales decreased 20% to US$210.7 million
(H1 FY 2022: US$264.7 million) as result of no sales of Exceptional Stones
during the Period (H1 FY 2022 US$77.9 million), lower volumes sold largely
owing to reduced tonnages at Finsch and lower grades at the Cullinan Mine,
which was partially offset by improved product mix, largely at the Cullinan
Mine, and a 12.6% increase in like-for-like diamond prices.
Mining and processing costs
The mining and processing costs for H1 FY 2023 comprised on-mine cash costs as
well as other operational expenses. A breakdown of the total mining and
processing costs for the Period is set out below.
On-mine Diamond Diamond Group Adjusted Depreciation Total
cash royalties inventory technical, mining and Williamson and mining and
costs1 and support processing tailings amortisation4 processing
US$m stockpile and costs facility - costs
US$m movement marketing remediation US$m (IFRS)
costs2 US$m costs3
US$m US$m
US$m US$m
H1 FY 2023 128.4 3.7 (8.8) 7.1 130.4 5.9 42.1 178.4
H1 FY 2022 129.8 3.4 (29.5) 6.1 109.8 - 43.1 152.9
FY 2022 272.3 14.6 0.5 19.7 307.1 - 84.4 391.5
Notes:
1. Includes all direct cash operating expenditure at operational level,
i.e. labour, contractors, consumables, utilities and on-mine overheads.
2. Certain technical, support and marketing activities are conducted on a
centralised basis.
3. Remediation costs comprise costs involved in establishing the root cause
of the failure, humanitarian relief to the affected community, livelihood- and
environmental restoration and costs to repair.
4. Includes US$5.2 million of accelerated depreciation at Williamson
relating to assets damaged in the TSF failure and amortisation of right-of-use
assets under IFRS 16 of US$1.7 million (H1 FY2022: US$0.6 million and FY 2022:
US$2.3 million) and excludes corporate / administration.
On-mine cash costs reduced by US$1.4 million (1.1%) compared to H1 FY 2022 and
in line with expectations, due to:
* The effect of translating ZAR denominated costs at the South African
operations at a weaker ZAR/USD average exchange rate (12.4% decrease)
* Lower production volumes at South African operations (5.0% decrease)
* Other cost savings, including reduction in on-mine costs due to
centralisation (3.4% decrease)
Offset by:
* Increase in Williamson cash costs compared to a lower prior year base,
following restart post-care and maintenance in H1 FY22 (12.0% increase)
* Inflationary increases (6.9% increase)
* Above-inflation increases associated with electricity costs (0.8% increase)
Royalties increased to US$3.7 million (H1 FY 2022: US$3.4 million) driven by
increased revenues from Williamson compared to the prior period.
Adjusted profit from mining activities
Adjusted profit from mining activities decreased 47% to US$82.3 million (H1 FY
2022: US$155.2 million), mainly due to no sales of Exceptional Stones during
the Period, the impact of lower volumes at the Cullinan and Finsch Mines, and
increased costs at Williamson being in production for a period of almost five
months (prior to the tailings storage facility failure when operations at the
mine ceased) compared to three months in the comparative period.
Adjusted corporate overhead - general and administration
Corporate overhead (before depreciation and share based payments) increased to
US$5.4 million for the Period (H1 FY 2022: US$4.9 million) mainly attributable
to the increase in corporate governance structures and costs associated with
the Williamson IGM process during the Period.
Adjusted EBITDA
Adjusted EBITDA, being profit from mining activities less adjusted corporate
overhead, decreased 49% to US$77.4 million (H1 FY 2022 US$150.9 million),
representing an adjusted EBITDA margin of 36% (H1 FY 2022: 57%) driven by the
lower production, increased mining costs and zero contribution from Exceptional
Stones.
Depreciation and amortisation
Depreciation and amortisation for the Period of US$42.4 million (H1 FY 2022:
US$43.1 million), decreased due to lower production and a weaking ZAR/USD,
offset by the inclusion of accelerated depreciation of US$5.2 million
attributable to the assets written down at Williamson as a result of the
tailings storage facility failure.
Impairment reversal / charge
As a result of the impairment reviews carried out at the Group's operating
assets and other receivables during the Period, an overall net impairment
charge of US$3.8 million (H1 FY 2022: US$0.1 million impairment reversal) was
recognised, comprising:
US$ million H1 FY H1 FY 2022
2023
Asset class
Impairment charge - property, plant & equipment (Refer (0.3) (0.3)
note 15)
Impairment (charge)/reversal - other current receivables (3.5) 0.4
(refer note 15)
Total (3.8) 0.1
Impairment reviews carried out at the Cullinan, Finsch and Williamson Mines did
not result in an impairment charge or reversal for operational assets during
the Period (H1 FY 2022: US$nil). Asset level impairment at Koffiefontein
amounted to US$0.3 million (H1 FY 2022: US$0.3 million), compared to the
Group's carrying value of property, plant and equipment of US$615.3 million (H1
FY 2022: US$624.0 million) pre-impairment.
During the Period, an impairment charge of US$3.5 million (H1 FY 2022: US$0.4
million) relating to VAT receivable at Williamson was recognised in the
Consolidated Income Statement.
Net financial expense
Net financial expense of US$27.0 million (H1 FY 2022: US$44.9 million)
comprises:
US$ million H1 FY 2023 H1 FY 2022
Net realised foreign exchange gain on settlement of - 8.8
forward exchange contracts and foreign loans
Interest received on bank deposits 1.7 0.5
Net interest receivable on the BEE partner loans and 0.8 1.3
amortisation of lease liabilities in accordance with
IFRS 16
Offset by:
Net realised foreign exchange loss on settlement of (7.7) -
forward exchange contracts and foreign loans
Interest on the Group's debt and working capital (13.6) (23.8)
facilities
Unwinding of the present value adjustment for Group (1.6) (3.0)
rehabilitation costs
Acceleration of unamortised bank facility and Notes (8.2) -
transaction costs
Net unrealised foreign exchange gains / (losses) 1.6 (28.7)
Net financial expense (27.0) (44.9)
Tax credit / charge
The tax charge of US$14.2 million (H1 FY 2022: US$13.6 million) comprised a
deferred tax charge of US$14.0 million (H1 FY 2022: US$24.3 million) and a net
current tax charge of US$0.2 million (H1 FY 2022: US$nil). The tax charge of
US$14.2 million (H1 FY 2022: US$13.6 million) comprised a deferred tax charge
of US$14.2 million (H1 FY 2022: US$24.3 million) in respect of the utilisation
of capital allowances at the Cullinan Mine, Finsch and Williamson Mines and
US$0.2 million deferred tax credit (H1 FY2022: US$11.1 million) relating to
unrealised foreign exchange losses during the Period, which reduced existing
deferred tax liabilities, with an income tax charge of US$0.2 million at
Williamson for the Period (H1 FY 2021: US$0.4 million at Finsch).
The current period effective tax rate is higher than the South African tax rate
of 27% (the Group's primary tax paying jurisdiction) primarily due to foreign
exchange losses and permanent differences as a result of the Koffiefontein
impairment and loss making companies (within the Group) where deferred tax
assets on operating losses are not recognised, which when consolidated reduces
the Group's overall profit before tax resulting in an increased effective tax
rate.
Williamson Tailings Storage Facility (TSF)
On 7 November 2022, the TSF wall at the Williamson mine was breached, resulting
in flooding away from the pit which has extended into certain areas outside of
the mine lease area. As a result, remediation costs relating to the incident
have been incurred during the Period and additional costs will be incurred
going forward. The remediation costs comprise establishing the root cause of
the failure, humanitarian relief to the affected community, livelihood and
environmental restoration and costs to repair.
In H1 FY 2023, US$1.5 million of costs have been incurred and a further US$4.4
million of costs, comprising management's best estimate based on the current
information available, has been provided for ongoing remediation costs.
In addition, US$5.2 million of accelerated depreciation was recognised in the
Period to fully write down assets damaged in the TSF breach.
Earnings per share
Basic loss per share from continuing operations of USc12.23 was recorded (H1 FY
2022: USc22.29 profit).
Adjusted loss per share from continuing operations (adjusted for impairment
charges, transaction costs and accelerated unamortised costs, taxation credit
on net unrealised foreign exchange losses and net unrealised foreign exchange
gains and losses) of USc0.91 was recorded (H1 FY 2022: USc29.01 profit
(adjusted for impairment charges, taxation charge on net unrealised foreign
exchange gains and net unrealised foreign exchange gains and losses)).
Operational free cash flow
During the Period, operational free cash flow of US$11.7 million (H1 FY 2022:
US$122.4 million) reflects the impact from an increase in capital expenditure
of US$32.4 million and a decrease in revenue from Exceptional Stones of US$89.1
million. This cash flow performance was further impacted by:
* US$6.4 million outflow (H1 FY 2022: US$4.8 million inflow) of net realised
foreign exchange gains/(losses) and cash finance expenses net of finance
income;
* US$2.7 million dividend paid to BEE partners (H1 FY 2022: US$3.5 million).
Cash and Diamond Debtors
As at 31 December 2022, Petra had cash at bank of US$146.6 million (H1 FY 2022:
US$272.3 million). Of these cash balances, US$130.4 million was held as
unrestricted cash (H1 FY 2022: US$256.7 million), US$15.4 million was held by
Petra's reinsurers as security deposits on the Group's cell captive insurance
structure (with regards to the Group's environmental guarantees) (H1 FY 2022:
US$14.8 million) and US$0.8 million was held by Petra's bankers as security for
other environmental rehabilitation bonds lodged with the Department of Mineral
Resources and Energy in South Africa (H1 FY 2022: US$0.8 million).
The decrease in cash balances is attributable to the repayment to Noteholders,
through a debt tender offer during the Period, of US$144.6 million comprising
the principal amount of US$126.4 million and PIK interest of US$18.2 million.
The principal amount of Notes outstanding after the repayments to Noteholders
is US$210,190,662. Cash costs of US$1.4 million attributable to the debt tender
offer have been expensed in the Consolidated Income Statement under finance
expense (refer to Note 6).
Diamond debtors as at 31 December 2022 were US$4.9 million (H1 FY 2022: US$0.4
million).
Loans and Borrowings
The Group had loans and borrowings (measured under IFRS) at Period end of
US$241.7 million (H1 FY 2022: US$425.3 million) comprised of US$210.2 million
of Second Lien Notes (including US$43.0 million of accrued interest and
unamortised transaction costs of US$11.5 million) and bank loans and borrowings
of US$nil (H1 FY 2022: US$78.6 million). Bank debt facilities undrawn and
available to the Group as at 31 December 2022 were US$58.8 million (H1 FY 2022:
US$0.6 million). Refer to note 8 for further details relating to the movement
in loans and borrowings during the Period.
Consolidated net debt as at 31 December 2022 was US$90.2 million (H1 FY2022:
US$152.3 million).
Covenant Measurements attached to banking facilities
The Company's EBITDA-related covenants associated with its banking facilities
are as outlined below:
· To maintain a Consolidated Net Debt : Adjusted EBITDA ratio tested
semi-annually on a rolling 12-month basis
· To maintain an Interest Cover Ratio (ICR) tested semi-annually on a rolling
12-month basis
· To maintain minimum 12 month forward looking liquidity requirement that
consolidated cash and cash equivalents (excluding diamond debtors) shall not
fall below US$20.0 million
The Company's covenant levels, which have not been breached during the Period
under review, for the respective measurement periods are outlined below:
FY22 H2 FY23 H1 FY23 H2 FY24 H1 FY24 H2 FY25 H1 FY25 H2 FY26 H1
Consolidated Net Debt :
EBITDA Leverage ratio 4.00 4.00 3.50 3.50 3.25 3.25 3.00 3.00
(maximum)
Interest Cover Ratio (ICR) 1.85 1.85 2.50 2.50 2.75 2.75 3.00 3.00
(minimum)
For further detail on the SA Lender facilities refer to Note 8 below.
Going concern considerations
The Board has reviewed the Group's forecasts with various sensitivities
applied, for the 18 months to June 2024, including both forecast liquidity and
covenant measurements. As per the First Lien agreements, the liquidity and
covenant measurements exclude contributions from Williamson's trading results
and only recognise cash distributions payable to Petra upon forecasted receipt,
or Petra's funding obligations towards Williamson upon payment.
The Board has given careful consideration to potential risks identified in
meeting the forecasts under the review period. The following sensitivities have
been performed in assessing the Group's ability to operate as a going concern
(in addition to the Base Case) as at the date of this report:
* A 10% decrease in forecast rough diamond prices from January 2023 to June
2024
* A 10% strengthening in the forecast South African Rand (ZAR) exchange rate
against the US Dollar from January 2023 to June 2024
* A 5% increase in operating costs from January 2023 to June 2024
* A US$15 million reduction in revenue contribution from the effects of
product mix and/or Exceptional Stones
* Combined sensitivity: prices down 10% and ZAR stronger by 10%, reduced
contribution from Exceptional Stones and operating costs up 5%
Under all the cases, the forecasts indicate that the Group's liquidity outlook
over the 18-month period to December 2024 remains strong, even when applying
the above sensitivities to the base case forecast.
The forward-looking covenant measurements associated with the new First Lien
(1L) facility do not indicate any breaches during the 18-month review period
for the base case as well as all the above sensitivities when considered on a
stand-alone basis. The combined sensitivity shows a covenant breach for the
required ICR in the June 2024 measurement period. While the ICR is projected to
be breached in this combined sensitivity, neither the Consolidated Net Debt :
EBITDA covenant nor the liquidity covenant is projected to be breached, while
the revolving credit facility (RCF) remains undrawn. It is therefore assumed
that the RCF remains available on the expectation that the 1L lender will agree
to an ICR covenant waiver given that the Group does not expect to utilise the
RCF for servicing of its Second Lien (2L) interest obligations. Furthermore,
this potential ICR breach may be cured by means of cost savings and revenue
enhancing opportunities through, for example, entering into partnership
agreements on the sale of high-value or Exceptional stones.
As a result, the Board concluded that there are no material uncertainties that
would cast doubt on the Company continuing as a going concern. See 'Basis of
preparation including going concern' in the Financial Statements for further
information.
Capex and Production
Total Group capex for the Period increased to US$51.9 million (H1 FY 2022:
US$16.7 million), comprising:
* US$38.2 million expansion capex (H1 FY 2022: US$11.7 million)
* US$13.7 million sustaining capex (H1 FY 2022: US$5.0 million)
Capex (US$m) H1 FY 2023 H1 FY 2022
Cullinan 23.3 12.5
Finsch 23.1 2.5
Williamson 3.2 0.8
Koffiefontein 0.3 0.3
Subtotal - capex incurred by operations 49.9 16.1
Corporate 2.0 0.6
Total Group capex 51.9 16.7
Group Production Summary
Below is a summary of the Group production for the Period, further detail can
be obtained from the H1 FY2023 Operating update released on 16 January 2023.
Production H1 FY 2023 H1 FY 2022
ROM tonnes Tonnes 5,240,992 5,401,532
Tailings and other tonnes Tonnes 198,090 238,292
Total tonnes treated Tonnes 5,439,082 5,639,824
ROM diamonds Carats 1,337,931 1,649,989
Tailings and other diamonds Carats 61,818 127,435
Total diamonds Carats 1,399,749 1,777,424
PRINCIPAL BUSINESS RISKS
The Group is exposed to a number of risks and uncertainties which could have a
material impact on its long-term development, and performance and management of
these risks is an integral part of the management of the Group.
A summary of the risks identified as the Group's principal external, operating
and strategic risks (in no order of priority), which may impact the Group over
the next twelve months, is listed below.
Risk Risk Risk Nature Change in FY 2023: H1
appetite rating of risk
External Risks
1. Rough High Medium Long No Change - The third tender for FY 2023 saw
diamond price term a 2.2% increase in like-for-like prices
compared to the second tender, reversing the
trend of the previous two tenders. An upward
movement of prices in the 2ct to 10ct size
ranges, as a likely result of the festive
season and easing of lockdown restrictions in
China, more than offset softer pricing in the
0.75ct to 2ct ranges. While some volatility
is expected in pricing in the short-term
given the ongoing macroeconomic situation, we
remain encouraged by the supportive diamond
market resulting from the projected supply
deficit in the medium to longer term.
2. Currency High Medium Long No change - The ZAR/USD rate weakened during
term H1 FY 2023, opening at R16.44 and ending the
six-month period at R17.00 and this provided
some support for Petra. The IMF's recent
positive sentiments on global growth (as
China eases its zero-COVID policies and
greater resilience is shown to impact higher
inflation/interest rates despite the ongoing
war in Ukraine) may drive the strength of
emerging market currencies, though this
remains to be seen for South Africa's Rand.
3. Country High Medium Long No change - The risk of political instability
and political term remains in South Africa. In addition,
rolling blackouts as a result of
load-shedding (electricity outages), continue
due to the inability of South Africa's
electricity provider to service the
population and businesses.
It has come to our attention that a portion
of the c.71kct parcel seized by the
Government of Tanzania ("GoT") in 2017 has
recently been sold. The proceeds of this
parcel are required to be allocated to WDL
under the Framework Agreement with the GoT.
We are engaging with the GoT to confirm the
application of the Blocked Parcel proceeds.
4. COVID-19 Medium Low Short to No change - Despite the emergence of a new,
pandemic medium more transmissible sub-variant, COVID-19
(operational term levels at Petra's operations have remained
impact) low during H1 FY 2023. The impact of COVID
19 infections continues to have no
significant effect on our operations or sales
processes at this time.
Strategic
Risks
5. Group Medium Medium Short to Higher - Whilst the Group's balance sheet was
Liquidity long strengthened through the repurchase of the
term Company's loan notes totalling US$145m,
resulting in annual interest savings of c.
US$14 million, the Group has experienced
operational challenges, including lower
grades experienced at the Cullinan Mine which
are now expected to continue through FY 2024
and lower tonnes mined at Finsch in H1 FY
2023, which impact Petra's liquidity
position.
A number of ongoing mitigating actions are
being taken to address these challenges.
Halting operations at Koffiefontein and
placing the mine on care and maintenance will
have a positive impact on liquidity for the
Group.
6. Licence to Medium High Long Higher - In light of operations at
operate: term Koffiefontein having ceased and consultations
regulatory and taking place regarding placing the mine on
social impact care and maintenance, increasing community
& community tensions have led to disagreements on the
relations viability and delivery of certain projects
that are required to be implemented under
Social and Labour Plans. Management has
conducted extensive engagements between local
communities, the DMRE and the local
municipality to resolve these issues.
At Williamson, the IGM became operational at
the end of November 2022 with the
commencement of the pilot scheme.
Whilst no fatalities or serious injuries were
reported after the TSF breach at Williamson,
the livelihoods of a number of community
members were affected. An assessment of the
impact on the surrounding communities and
potential remediation is currently nearing
completion. The TSF breach has resulted in
WDL providing immediate humanitarian relief
to those affected and work is underway to
develop an Entitlement Framework that will
enable community members who have been
impacted by the TSF breach to be
appropriately compensated.
Operating
Risks
7. Mining; Medium High Long Higher - Lower grades at the Cullinan Mine
production term are now expected to continue through FY
(including ROM 2024. This is attributable to the C-Cut cave
grade and maturity as the cave progresses from SW to
product mix NE and the earlier than anticipated waste
volatility) ingress from the overlying depleted mining
blocks. Several mitigating actions are
underway to address these grade issues,
including:
. Tailings treatment has been optimised
but is not in isolation sufficient to
address the grade reduction.
. The re-opening of Tunnels 36 (which
has already commenced) and 41 and the
establishment of Tunnels 46 and 50 (the
development of which have recently been
approved by the Board) will provide
additional volume from FY 2025 and more than
offset the impact of lower grades in FY 2023
/24.
. Production from the CC1E project will
contribute meaningfully from FY 2025 and is
expected to see grades move back towards
40cpht.
Finsch's production target fell short of
guidance largely attributable to low machine
availability owing to an ageing underground
fleet, challenges with the centralised
blasting system and emulsion quality and an
extended rock-winder breakdown.
As noted above, production at Williamson has
been suspended for the remainder of FY 2023
due to the TSF breach and a restart is
reliant on the implementation of an interim
TSF, with operations anticipated to restart
in Q1 FY 2024.
Operations at Koffiefontein have ceased in
light of consultations to place the mine on
care and maintenance.
As a result of the above events, Group
production guidance has been lowered to c.
2.8 Mcts for FY 2023 and 3.0 to 3.3 Mcts for
FY 2024.
8. Labour Medium Medium Short to No Change - Stable labour relations were
relations medium experienced at all operations throughout H1
term FY23. For FY 2023, the Group has introduced
a quarterly production bonus scheme for
lower band employees to ensure alignment
with other incentive structures across the
Group.
A Collective Bargaining Agreement with
TAMICO, the majority union at Williamson,
was signed in November 2022.
A statutory consultation process is underway
with employees regarding placing
Koffiefontein in care and maintenance which
would result in the retrenchment of the
mine's workforce.
9. Safety Medium Medium Short to Higher - LTIFR and LTIs marginally increased
medium to 0.19 and 7 respectively in comparison to
term H1 FY 2022. FY 2023 YTD safety indicators
show a declining trend. Remedial actions and
behaviour intervention programmes with
various focus areas have been launched to
address this trend.
10. Medium Medium Long Higher - Following the TSF breach at
Environment term Williamson on 7 November 2022, significant
work has been undertaken to contain the
breach, determine the extent of the
environmental impact and commence
environmental remediation. An investigation
is being conducted to determine the root
cause of the TSF breach. WDL continues to
engage with Tanzania's environmental
regulator (National Environment Management
Council) regarding the breach.
No significant changes in terms of
environmental impacts were observed for the
SA operations in H1 FY2023.
11. Climate High Medium Long No Change - Management continues to monitor
Change term progress against annual climate change
targets set for on-mine water and electricity
consumption and efficiency.
Petra is looking to formulate and implement a
renewables strategy that will be key in
enabling Petra to reach its 2030 interim
target of a 35-40% reduction in Scope 1 & 2
emissions (against Petra's 2019 baseline).
12. Supply Medium High Short to Higher - Progress was made in the Supply
Chain medium Chain function to address various gaps which
Governance term included: (1) reviewing the Group's Supply
Chain policy to improve compliance,
governance and risk management, (2) improving
procurement, tender and supplier registration
procedures and (3) filling critical roles in
the function. An online due diligence
platform, administered by an external third
party, went live in December 2022 to improve
the vetting and screening of suppliers.
An independent external expert was engaged to
conduct a gap analysis of existing Supply
Chain processes and systems and this has
resulted in management formulating action
plans to address areas that require
improvement.
13. Capital Medium High Short to Higher - For the CC1E Project at the Cullinan
Projects medium Mine and the Lower Block 5 3 Levels SLC at
term Finsch, management have initiated various
mitigating actions led by intensive safety
inventions and expediting Trackless Mining
Machinery and drill rig availability to
address the risk of both projects falling
behind project plans. Alternate labour
sourcing strategies are also being
considered.
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED INCOME STATEMENT
FOR THE 6 MONTH PERIODED 31 DECEMBER 2022
US$ million Notes (Unaudited) (Unaudited) (Audited)
1 July 1 July Year ended
2022- 2021- 30 June
31 December 31 December 2022
2022 2021
Revenue 212.1 264.7 585.2
Mining and processing costs (178.4) (152.9) (391.5)
Other direct income / expense 0.6 0.3 (0.8)
Corporate expenditure including 5 (7.4) (5.2) (14.1)
settlement costs
Other corporate income 0.5 0.6 0.6
Impairment (charge) / reversal of 15 (0.3) (0.3) 21.1
non-financial assets
Impairment (charge) / reversal of other 15 (3.5) 0.4 (1.5)
receivables
Total operating costs (188.5) (157.1) (386.2)
Financial income 6 25.8 11.4 19.0
Financial expense 6 (52.8) (56.3) (92.1)
(Loss) / profit before tax (3.4) 62.7 125.9
Income tax charge (14.2) (13.6) (37.8)
(Loss) / profit for the Period (17.6) 49.1 88.1
Attributable to:
Equity holders of the parent company (23.7) 43.2 69.0
Non-controlling interest 6.1 5.9 19.1
(17.6) 49.1 88.1
Profit per share attributable to the
equity holders of the parent during the
Period:
Continuing operations:
Basic (loss) / earnings per share - US 13 (12.23) 22.29 35.53
cents
Diluted (loss) / earnings per share - 13 (12.23) 22.29 35.53
US cents
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 6 MONTH PERIODED 31 DECEMBER 2022
US$ million (Unaudited) (Unaudited) (Audited)
1 July 1 July Year ended
2022- 2021- 30 June
31 December 31 December 2022
2022 2021
(Loss) / profit for the Period (17.6) 49.1 88.1
Exchange differences on translation of the - - (0.3)
share-based payment reserve
Exchange differences on other reserves - - -
Exchange differences on translation of foreign (18.1) (44.6) (46.8)
operations1
Exchange differences on non-controlling (0.5) 0.3 (0.4)
interest1
Total comprehensive (loss) / income for the (36.2) 4.8 40.6
Period
Total comprehensive income and expense
attributable to:
Equity holders of the parent company (41.8) (1.4) 21.9
Non-controlling interest 5.6 6.2 18.7
(36.2) 4.8 40.6
¹ These items will be reclassified to the consolidated income statement if
specific future conditions are met.
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
US$ million Notes (Unaudited) (Unaudited) (Audited)
31 31 December 30 June
December 2021 2022
2022
ASSETS
Non-current assets
Property, plant and equipment 7 620.2 626.6 633.2
Right-of-use assets 20.0 26.8 21.9
BEE loans and receivables 11 38.2 43.1 44.6
Other receivables 2 5.1 1.8 2.6
Total non-current assets 683.5 698.3 702.3
Current assets
Trade and other receivables 24.7 26.2 49.8
Inventories 81.7 97.5 70.6
Cash and cash equivalents (including 146.6 272.3 288.2
restricted amounts)
Total current assets 253.0 396.0 408.6
Total assets 936.5 1,094.3 1,110.9
EQUITY AND LIABILITIES
Equity
Share capital 12 145.7 145.7 145.7
Share premium account 12 609.5 959.5 959.5
Foreign currency translation reserve (467.0) (446.7) (448.9)
Share-based payment reserve 2.8 1.9 1.9
Other reserves (0.8) (0.8) (0.8)
Accumulated reserves / (losses) 12 142.7 (210.1) (183.6)
Attributable to equity holders of the 432.9 449.5 473.8
parent company
Non-controlling interest 0.5 (7.8) 4.7
Total equity 433.4 441.7 478.5
Liabilities
Non-current liabilities
Loans and borrowings 8 221.1 398.0 353.9
Provisions 97.3 96.0 97.7
Lease liabilities 17.8 23.6 19.2
Deferred tax liabilities 82.4 55.3 71.3
Total non-current liabilities 418.6 572.9 542.1
Current liabilities
Loans and borrowings 8 20.6 27.3 12.3
Lease liabilities 3.0 3.2 3.2
Trade and other payables 56.5 49.2 74.8
Provisions 2 4.4 - -
Total current liabilities 84.5 79.7 90.3
Total liabilities 503.1 652.6 632.4
Total equity and liabilities 936.5 1,094.3 1,110.9
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIODED 31 DECEMBER 2022
US$ million Notes (Unaudited) (Unaudited) (Audited)
1 July 1 July Year ended
2022- 2021- 30 June
31 December 31 December 2022
2022 2021
(Loss) / profit before taxation for the (3.4) 62.7 125.9
Period
Depreciation of property plant and 40.5 42.9 82.8
equipment
Amortisation of right-of-use asset 1.9 0.6 2.5
Impairment charge - non financial assets 15 0.3 0.3 (21.1)
Impairment charge / (reversal) - other 15 3.5 (0.4) 1.5
receivables
Movement in provisions 4.3 (3.3) 1.6
Dividend received from BEE partner (0.5) (0.6) (0.6)
Financial income 6 (25.8) (11.4) (19.0)
Financial expense 6 52.8 56.3 92.1
Profit on disposal of property, plant and - 0.1 1.5
equipment
Share based payment provision 0.9 0.1 1.1
Operating profit before working capital 74.5 147.3 268.3
changes
Decrease / (increase) in trade and other 15.7 25.3 (7.1)
receivables
(Decrease) / increase in trade and other (15.0) (2.2) 24.5
payables
Increase in inventories (12.6) (29.5) (1.7)
Cash generated from operations 62.6 140.9 284.0
Net realised gains on foreign exchange 4.1 8.7 12.6
contracts
Finance expense (0.4) (4.4) (6.3)
Income tax received / (paid) 0.3 (0.4) (7.8)
Net cash generated from operating 66.6 144.8 282.5
activities
Cash flows from investing activities
Acquisition of property, plant and (50.9) (18.5) (54.0)
equipment
Proceeds from sale of property, plant and - 0.1 -
equipment
Loan repayment from BEE partners - 0.4 0.2
Dividend paid to BEE partners (2.7) (3.5) (3.5)
Dividend received from BEE partners 0.5 0.6 0.6
Repayment from KEMJV 0.3 1.9 2.5
Finance income 1.7 0.5 1.3
Net cash utilised in investing activities (51.1) (18.5) (52.9)
Cash flows from financing activities
Cash paid on lease liabilities (2.4) (0.8) (3.2)
Net realised foreign exchange loss on
settlement of foreign currency loans (11.8) - -
Repayment of borrowings (including Notes 8
redemption premium of US$1.4 million; 31
December 2021: US$nil; 30 June 2022: (146.1) (14.4) (98.2)
US$nil)
Net cash utilised by financing activities
(160.3) (15.2) (101.4)
Net (decrease) / increase in cash and (144.8) 111.1 128.2
cash equivalents
Cash and cash equivalents at beginning of 271.9 156.9 156.9
the Period
Effect of exchange rate fluctuations on 3.3 (11.3) (13.2)
cash held
Cash and cash equivalents at end of the 130.4 256.7 271.9
Period1
1. Cash and cash equivalents in the Consolidated Statement of Financial
Position includes restricted cash of US$16.2 million (30 June 2022: US$16.3
million and 31 December 2021: US$15.6 million) and unrestricted cash of
US$130.4 million (30 June 2022: US$271.9 million and 31 December 2021: US$256.7
million).
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 31 DECEMBER 2022
(Unaudited) Share Share Foreign Share-based Other Accumulated Attributable Non-controlling Total
capital premium currency payment reserves reserves / to the interest equity
account translation reserve (losses) parent
US$ million reserve
Six month Period
ending 31 December
2022:
At 1 July 2022 145.7 959.5 (448.9) 1.9 (0.8) (183.6) 473.8 4.7 478.5
(Loss) / profit for - - - - - (23.7) (23.7) 6.1 (17.6)
the Period
Other comprehensive - - (18.1) - - - (18.1) (0.5) (18.6)
(expense) / income
Conversion of share - (350.0) - - - 350.0 - - -
premium (refer note
12)
Dividend paid to - - - - - - - (9.8) (9.8)
Non-controlling
interest
shareholders
Equity settled share - - - 0.9 - - 0.9 - 0.9
based payments
At 31 December 2022 145.7 609.5 (467.0) 2.8 (0.8) 142.7 432.9 0.5 433.4
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 31 DECEMBER 2022
(Unaudited) Share Share Foreign Share-based Other Accumulated Attributable Non-controlling Total
capital premium currency payment reserves losses to the interest equity
account translation reserve parent
US$ million reserve
Six month Period
ending 31 December
2021:
At 1 July 2021 145.7 959.5 (402.1) 1.8 (0.8) (253.3) 450.8 (10.5) 440.3
Profit for the Period - - - - - 43.2 43.2 5.9 49.1
Other comprehensive - - (44.6) - - - (44.6) 0.3 (44.3)
(expense) / income
Dividend paid to - - - - - - - (3.5) (3.5)
Non-controlling
interest shareholders
Equity settled share - - - 0.1 - - 0.1 - 0.1
based payments
At 31 December 2021 145.7 959.5 (446.7) 1.9 (0.8) (210.1) 449.5 (7.8) 441.7
PETRA DIAMONDS LIMITED
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 31 DECEMBER 2022
(Unaudited) Share Share Foreign Share-based Other Accumulated Attributable Non-controlling Total
capital premium currency payment reserves losses to the interest equity
account translation reserve parent
US$ million reserve
Year ended 30 June
2022:
At 1 July 2021 145.7 959.5 (402.1) 1.8 (0.8) (253.3) 450.8 (10.5) 440.3
Profit for the Year - - - - - 69.0 69.0 19.1 88.1
Other comprehensive - - (46.8) (0.3) - - (47.1) (0.4) (47.5)
expense
Dividend paid to - - - - - - - (3.5) (3.5)
Non-controlling
interest shareholders
Equity settled share - - - 1.1 - - 1.1 - 1.1
based payments
Transfer between - - - (0.7) - 0.7 - - -
reserves:
At 30 June 2022 145.7 959.5 (448.9) 1.9 (0.8) (183.6) 473.8 4.7 478.5
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIODED 31 DECEMBER 2022
1. GENERAL INFORMATION
Petra Diamonds Limited (the "Company"), a limited liability company listed on
the Main Market of the London Stock Exchange, is registered in Bermuda with its
Group management office domiciled in the United Kingdom. The Consolidated
Interim Financial Statements of the Company for the six month period ended 31
December 2022 comprise the Company and its subsidiaries, joint operations and
associates (together referred to as the "Group").
2. ACCOUNTING POLICIES
The interim results, which are unaudited, have been prepared in accordance with
the requirements of International Accounting Standard 34. This condensed
interim report does not include all the notes of the type normally included in
an annual financial report. This condensed report is to be read in conjunction
with the Annual Report for the year ended 30 June 2022, and any public
announcements made by the Group during the interim reporting period. The annual
financial report for the year ended 30 June 2022 was prepared in accordance
with International Financial Reporting Standards adopted by the European Union
("IFRS's") and the accounting policies applied in this condensed interim report
are consistent with the polices applied in the annual financial report for the
year ended 30 June 2022 unless otherwise noted.
Basis of preparation including going concern
Going concern
The six-month period to 31 December 2022 delivered US$77.4 million in adjusted
EBITDA and US$11.7 million in operational free cash flow for the Group, while
Consolidated Net Debt reduced from $40.6 million as at 30 June 2022 to US$90.2
million at 31 December 2022.
Production
The first half of FY23 saw all of the Petra operations deal with operational
challenges. The Cullinan Mine experienced lower grades in the block cave on
account of accelerated waste ingress, resulting in lower ROM carats being
recovered, while also lowering the ROM carats production for the remainder of
FY23 and FY24. Several mitigation steps are currently being investigated to
minimise the impact of the lower grade. These include re-opening of T36 & T41,
while also evaluating the addition of two more tunnels (T46&T50) adjacent to
the current C-Cut centre.
Finsch experienced production challenges as a result of machine availability
owing to an aging underground fleet, challenges with the centralised blasting
system and emulsion quality and an extended rock-winder breakdown. Several
mitigation steps were implemented at Finsch, such as new underground equipment
being delivered and commissioned, coupled with positive changes to the blasting
process, the introduction of new long hole drill rigs and Load Haul Dump (LHDs)
loaders as well as the appointment of individuals to a number of key positions.
Furthermore, the 3-Level SLC project scope was amended to 90L, which adds
additional production tonnes to the Life of Mine plan. The mitigation steps
undertaken are expected to limit the lower production to FY23, with FY24
expected to deliver as per previous guidance, while the new project is expected
to add value beyond this Going Concern assessment period.
Williamson performed well throughout FY2023 until the Tailings Storage Facility
incident in the first week of November 2022. Production has been suspended
until the new tailings storage facility is completed. It is assumed that
production will only commence in July 2023. Progress is also being made in
closing out the Framework Agreement with the Government of Tanzania and the MoU
with Caspian).
Following the unsuccessful sales process during the Period, production at
Koffiefontein was stopped in November 2022 and the operation has subsequently
been placed on care and maintenance.
Diamond prices and diamonds market
Diamond prices continued their upward trend, with a 12.7% increase on a
like-for-like basis compared H1 FY22. While the Cullinan Mine did not
contribute revenue from exceptional stones (>US$5.0 million), it has generated
a robust $/ct price on account of a strong product mix, including several high
value single stones that did not individually breach the US$5.0 million
threshold.
Diamond prices are now the highest since the peaks experienced in 2011/2012. In
general, the market continues to be supported by a fundamental supply deficit,
with robust demand recovery experienced post COVID-19. From a demand
perspective, the Chinese lockdown had potentially moderated demand for certain
categories of polished goods, while the rising inflation and interest rate
cycles may impact disposable income and therefore further moderate/reduce
short-term demand for diamonds. This may lead to some short-term price
volatility, but the medium-long term supply/demand fundamentals are expected to
support the diamond price outlook.
Williamson framework agreement and MoU
The Group announced that it had entered into a framework agreement with the
Government of Tanzania in December 2021, which sets out key principles on the
economic benefit sharing amongst WDL shareholders, treatment of outstanding VAT
balances, the allocation of proceeds of the blocked parcel of diamonds and
settlement of historic disputes, amongst others. This agreement should provide
important fiscal stability for the mine and its investors and will become
effective upon completion of certain suspensive conditions. At the same time,
Petra also announced entering into a non-binding Memorandum of Understanding
(MoU) with Caspian Ltd to sell 50% (less 1 share) of Petra's indirect stake in
WDL for a purchase consideration of US$15 million.
Bond tender offer and South African banking facilities
During the Period, the Group carried out a successful tender offer to its
Noteholders, repaying the Noteholders US$144.6 million (principal plus
interest), utilising existing cash reserves at the time, resulting in the
deleveraging of the gross debt balances within the Group.
The Group's ZAR 1 billion senior Revolving Credit Facility (RCF) facility
remains undrawn at 31 December 2022, with the Group having access to the full
ZAR 1 billion (US$58.8 million).
The factors above, coupled with the further significant progress towards
stabilising the Group's balance sheet positions the Group well for this Going
Concern period.
Forecast liquidity and covenants
The Board has reviewed the Group's forecasts with various sensitivities applied
for the 18 months to June 2024, including both forecast liquidity and covenant
measurements. As per the First Lien agreements, the liquidity and covenant
measurements exclude contributions from Williamson's trading results and only
recognises cash distributions payable to Petra upon forecasted receipt, or
Petra's funding obligations towards Williamson upon payment.
The Board has given careful consideration to potential risks identified in
meeting the forecasts under the review period. The following sensitivities have
been performed in assessing the Group's ability to operate as a going concern
(in addition to the Base Case) at the date of this report:
* a 10% decrease in forecast rough diamond prices from January 2023 to June
2024
* a 10% strengthening in the forecast South African Rand (ZAR) exchange rate
from January 2023 to June 2024
* a 5% increase in Operating Costs from July 2022 to Dec 2023
* a US$15 million reduction in revenue contribution from the effects of
product mix and/or from Exceptional Stones
* Combined sensitivity: Prices down 10% and ZAR stronger by 10% and
Exceptional Stones contributions reduced by US$15 million and Operating
Costs up 5%
Under all the cases, the forecasts indicate the Group's liquidity outlook over
the 18-month period to June 2024 remains strong, even when applying the above
sensitivities to the base case forecast.
The forward-looking covenant measurements associated with the new First Lien
facility do not indicate any breaches during the 18-month review period for the
base case as well as all the above sensitivities, except for the worse case
combined sensitivity, which shows a covenant breach for the required interest
cover ratio in the June 2024. While the ICR is projected to be breached in this
combined sensitivity, both the Net Debt : EBITDA covenant and the liquidity
covenant remain healthy, while the RCF remains undrawn. It is therefore assumed
that the RCF remains available, with the 1L lender assumed to agree to an ICR
covenant waiver, given that the Group does not expect to utilise the RCF for
servicing of its 2L interest obligations. Furthermore, this potential ICR
breach may be cured by means of cost savings and revenue enhancing
opportunities through entering into partnership agreements on the sale of
Exceptional stones.
Conclusion
The Board is of the view that the longer-term fundamentals of the diamond
market remain sound and that the Group will continue to benefit from an
improving operating model throughout the review period and beyond.
Based on its assessment of the forecasts, principal risks and uncertainties and
mitigating actions considered available to the Group in the event of downside
scenarios, the Board confirms that it is satisfied the Group will be able to
continue to operate and meet its liabilities as they fall due over the review
period. Accordingly, the Board have concluded that the going concern basis in
the preparation of the financial statements is appropriate and that there are
no material uncertainties that would cast doubt on that basis of preparation.
New standards and interpretations applied
The IASB has issued new standards, amendments and interpretations to existing
standards with an effective date on or after 1 July 2022 which are not
considered to have a material impact on the Group during the Period under
review.
New standards and interpretations not yet effective
Certain new standards, amendments and interpretations to existing standards
have been published that are mandatory for the Group's accounting periods
beginning after 1 July 2022 or later periods. The only standard which is
anticipated to be significant or relevant to the Group is:
Amendments to IAS 1: Classification of Liabilities as Current or Non-current
Amendments to IAS 1, which are intended to clarify the requirements that an
entity applies in determining whether a liability is classified as current or
non-current. The amendments are intended to be narrow scope in nature and are
meant to clarify the requirements in IAS 1 rather than modify the underlying
principles. The amendments include clarifications relating to:
* how events after the end of the reporting period affect liability
classification;
* what the rights of an entity must be in order to classify a liability as
non-current;
* how an entity assesses compliance with conditions of a liability (e.g. bank
covenants); and
* how conversion features in liabilities affect their classification.
The amendments were originally effective for periods beginning on or after 1
January 2022 which was deferred to 1 January 2023 by the IASB in July 2020.
Earlier application is permitted but Amendments to IAS 1 has not yet been
endorsed for application by the European Union.
Significant assumptions and judgements:
The preparation of the condensed consolidated interim financial statements
requires management to make estimates and judgements and form assumptions that
affect the reported amounts of the assets and liabilities, reported revenue and
costs during the periods presented therein, and the disclosure of contingent
liabilities at the date of the interim financial statements. Estimates and
judgements are continually evaluated and based on management's historical
experience and other factors, including future expectations and events that are
believed to be reasonable. The estimates and assumptions that have a
significant risk of causing a material adjustment to the financial results of
the Group in future reporting periods are discussed below.
Key estimates and judgements:
Impairment reviews
The Group prepares impairment models and assesses mining assets for impairment
or reversals of previous impairments. While conducting an impairment test of
its assets using recoverable values using the current life of mine plans, the
Group exercised judgement in making assumptions about future rough diamond
prices, foreign exchange rates, volumes of production, ore reserves and
resources included in the current life of mine plans, future development and
production costs and factors such as inflation and discount rates. Changes in
estimates used can result in significant changes to the 'Consolidated Income
Statement' and 'Statement of Financial Position'.
Cullinan, Finsch, Koffiefontein and Williamson Mines
The impairment tests for the Cullinan, Finsch and Williamson Mines indicated no
further impairment charges or reversals to be recognised. The impairment test
for Koffiefontein indicated an impairment of US$0.3 million on a carrying value
of the Group's property, plant and equipment of US$615.3 million
(pre-impairment). This follows US$21.1 million impairment reversal recognised
at 30 June 2022 (comprising Koffiefontein impairment charge of US$0.3 million
and a Group level impairment reversal relating to Williamson, previously
recognised under IFRS 5, of US$21.4 million as Williamson was no longer
considered an asset held for sale.) on a carrying value of the Group's
property, plant and equipment of US$608.2 million (pre-impairment) at the time
of recognition. For further details of the inputs, assumptions and
sensitivities in the impairment model, refer to note 15.
Recoverability and ownership of diamond parcel in Tanzania
The Group holds diamond inventory valued at US$12.5 million (30 June 2022:
US$12.5 million and 31 December 2021: US$10.6 million) in the Statement of
Financial Position in respect of the Williamson mine's confiscated diamond
parcel. The diamond inventory parcel was written up from the net realisable
value of prior periods to historical cost during FY2022. The recommencing of
operations and the sales tenders at Williamson during the FY 2022 provided
additional information for management to assess the value of the diamond parcel
and was the basis used to revalue the diamond parcel to the lower of cost or
net realisable value. During FY 2018, an investigation into the Tanzanian
diamond sector by a parliamentary committee in Tanzania was undertaken to
determine if diamond royalty payments were being understated. In connection
with this, Petra announced on 11 September 2017 that a parcel of diamonds
(71,654.45 carats) from the Williamson mine in Tanzania (owned 75% by Petra and
25% by the Government of the United Republic of Tanzania ("GoT")) had been
blocked for export to Petra's marketing office in Antwerp.
The assessment of the recoverability of the diamond parcel required significant
judgement. In making such a judgement, the Group considered the Framework
Agreement that was signed with the GoT on 13 December 2021, confirmation
received from the GoT in FY 2018 that they held the diamond parcel of 71,654.45
carats, ongoing discussions held with the GoT, an assessment of the internal
process used for the sale and export of diamonds confirming such process is in
full compliance with legislation in Tanzania and the Kimberley Process and
legal advice received from the Group's in-country attorneys which supports the
Group's position.
The Framework Agreement which refers to the diamond parcel as the "Government
Diamond Parcel" sets out that the GoT agrees to allocate proceeds from the sale
of the Parcel to Williamson Diamonds Limited ("WDL"). Post period end, the
Company was informed that a portion of the Parcel was sold and the Company is
engaging with the GoT to confirm the application of the proceeds. For further
details refer to note 18.
While these engagements between the Company and the GoT are ongoing, based on
the above judgements and assessment thereof, management remain confident that
based on the signed Framework Agreement, and the legal advice received from the
Group's in-country attorneys, WDL will derive future economic benefit from the
sale proceeds of the parcel (both the portion already sold and any portion that
is yet to be sold).
Recoverability of VAT in Tanzania
The Group has VAT receivable of US$5.1 million (30 June 2022: US$2.6 million
and 31 December 2021: US$1.8 million) in respect of the Williamson mine, all of
which are past due and have therefore been classified, after provision
including amounts related to providing for a time-value of money inclusive of
risk adjustments for various factors, as non-current given the potential delays
in receipt.
The VAT receivable as at 31 December 2022, can be split into two identifiable
component time periods as set out below:
31 December 2022
US$ million VAT Provision Carrying
Receivable value
Pre July 2017 and Post June 2020 14.6 (9.5) 5.1
14.6 (9.5) 5.1
31 December 2021
US$ million VAT Provision Written off Carrying
Receivable value
July 2017 to June 2020 26.9 - (26.9) -
Pre July 2017 and Post June 4.4 (2.6) - 1.8
2020
31.3 (2.6) (26.9) 1.8
30 June 2022
US$ million VAT Provision Written off Carrying
Receivable value
July 2017 to June 2020 26.9 - (26.9) -
Pre July 2017 and Post June 8.6 (6.0) - 2.6
2020
35.5 (6.0) (26.9) 2.6
Pre July 2017 and Post June 2020
An amount of US$14.6 million (30 June 2022: US$8.6 million and 31 December
2021: US$4.4 million) of VAT is receivable for the period for the period pre
July 2017 and subsequent to 1 July 2020. The Group is considering various
alternatives in pursuing payment in accordance with legislation. A provision of
US$9.5 million (30 June 2022: US$6.0 million and 31 December 2021: US$2.6
million), given the uncertainty around the timing of receipts of the amount
outstanding, has been provided for against the US$14.6 million (30 June 2022:
US$8.6 million and 31 December 2021: US$4.4 million) receivable resulting in a
carrying value of US$5.1 million (30 June 2022: US$2.6 million and 31 December
2021: US$1.8 million).
While the remaining pre July 2017 and post 1 July 2020 VAT balance is
considered recoverable, significant uncertainty exists regarding the timing of
receipt. A discount rate of 14.00% inclusive of estimated country credit risk
has been applied to the expected cash receipts. A 1% increase in the discount
rate would increase the provision by US$0.3 million and a one year delay would
increase the provision by US$0.6 million.
During the Period, an impairment charge of US$3.5 million (30 June 2022: US$4.1
million and 31 December 2021: US$0.7 million) was recognised in the
Consolidated Income Statement.
BEE receivables - expected credit loss provision
The Group has applied the expected credit loss impairment model to its BEE
loans receivable. In determining the extent to which expected credit losses may
apply, the Group assessed the future free cashflows to be generated by the
mining operations, based on the current mine plans. In assessing the future
cashflows, the Group considered the diamond price outlook and the probability
of reaching an offset agreement. Based on the assessment, no expected credit
loss reversal was recognised in the respective periods. For further detail
refer to note 11.
Life of mine and ore reserves and resources
There are numerous risks inherent in estimating ore reserves and resources and
the associated current life of mine plan. The life of mine plan is the current
approved management plan for ore extraction that considers specific resources
and associated capital expenditure. The life of mine plan frequently includes
less tonnes than the total reserves and resources that are set out in the
Group's Resource Statement and which management may consider to be economically
viable and capable of future extraction.
Management must make a number of assumptions when making estimates of reserves
and resources, including assumptions as to exchange rates, rough diamond and
other commodity prices, extraction costs, recovery and production rates. Any
such estimates and assumptions may change as new information becomes available.
Changes in exchange rates, commodity prices, extraction costs, recovery and
production rates may change the economic viability of ore reserves and
resources and may ultimately result in the restatement of the ore reserves and
resources and potential impairment to the carrying value of the mining assets
and life of mine plans. Refer to note 15 for further detail on the assumptions.
The current life of mine plans are used to determine the ore tonnes and capital
expenditure in the impairment tests. Ore reserves and resources, both those
included in the life of mine and certain additional tonnes which form part of
reserves and resources considered to be sufficiently certain and economically
viable, also impact the depreciation of mining assets depreciated on a unit of
production basis. Ore reserves and resources, outside the current mine plan
further impact the estimated date of decommissioning and rehabilitation.
Williamson Tailings Storage Facility
On 7 November 2022, the tailings storage facility at the Williamson mine was
breached, resulting in flooding away from the pit which has extended into
certain areas outside of the mine lease area. As a result, remediation costs
relating to the incident have been incurred during the Period and additional
costs will be incurred going forward. The remediation costs comprise
establishing the root cause of the failure, humanitarian relief to the affected
community, livelihood and environmental restoration and costs to repair.
Judgement has been applied by Management in assessing the future remediation
costs. Management have considered the current work streams, the estimated time
of completion and appropriate information received from suppliers and
contractors involved in the remediation process.
In H1 FY2023, US$4.4 million of costs, comprising management's best estimate
based on the current information available, has been provided for in respect of
ongoing remediation costs.
Other key estimates and judgements
In addition to the key estimates and judgements disclosed above, the following
estimates and judgements have not significantly changed from those disclosed in
the FY 2022 Annual Report and will be discussed in further detail in the FY
2023 Annual Report:
* Provision for rehabilitation
* Inventory and inventory stockpile
* Depreciation
* Pension and post-retirement medical fund schemes
* Net investments in foreign operations
* Taxation
3. DIVIDS
No dividends have been declared in respect of the current Period under review
(30 June 2022: US$nil and 31 December 2021: US$nil).
4. SEGMENTAL INFORMATION
Segment information is presented in respect of the Group's operating and
geographical segments:
Mining - the extraction and sale of rough diamonds from mining operations in
South Africa and Tanzania.
Corporate - administrative activities in the United Kingdom.
Beneficiation - beneficiation activities in South Africa.
Segments are based on the Group's management and internal reporting structure.
Management reviews the Group's performance by reviewing the results of the
mining activities in South Africa, Tanzania and reviewing the results of
reviewing the corporate administration expenses in the United Kingdom. Each
segment derives, or aims to derive, its revenue from diamond mining and diamond
sales, except for the corporate and administration cost centre.
Segment results, assets and liabilities include items directly attributable to
a segment, as well as those that can be allocated on a reasonable basis.
Segment results are calculated after charging direct mining costs, depreciation
and other income and expenses. Unallocated items comprise mainly
interest-earning assets and revenue, interest-bearing borrowings and expenses
and corporate assets and expenses. Segment capital expenditure is the total
cost incurred during the year to acquire segment assets that are expected to be
used for more than one period. Eliminations comprise transactions between Group
companies that are cancelled on consolidation. The results are not materially
affected by seasonal variations. Revenues are generated from tenders held in
South Africa and Antwerp for external customers from various countries, the
ultimate customers of which are not known to the Group.
4. SEGMENTAL INFORMATION (continued)
Operating segments South Africa - Mining activities Tanzania United South Africa
-Mining Kingdom
activities
Cullinan Finsch Koffiefontein Williamson Corporate Beneficiation3 Inter-segment Consolidated
US$ million Mine and
treasury
(6 month period ended 31 December 2022) 1 July 1 July 1 July 2022 - 1 July 1 July 1 July 2022 - 1 July 2022 - 1 July 2022
2022 - 2022 - 31 December 2022 - 2022 - 31 December 31 December -
31 31 2022 31 31 2022 2022 31 December
December December December December 2022
2022 2022 2022 2022
Revenue 104.1 55.4 3.6 49.1 - 0.5 (0.6) 212.1
Segment result¹ 42.8 10.1 (8.4) (9.4) (7.6) 0.5 (1.7) 26.3
Impairment charge - operations - - (0.3) - - - - (0.3)
Impairment charge - other receivables - - - (3.5) - - - (3.5)
Other direct income - 0.5 - 0.1 0.5 - - 1.1
Operating profit / (loss)² 42.8 10.6 (8.7) (12.8) (7.1) 0.5 (1.7) 23.6
Financial income 25.8
Financial expense (52.8)
Income tax charge (14.2)
Non-controlling interest (6.1)
Profit attributable to equity holders (23.7)
of the parent company
Segment assets 446.7 203.2 4.7 124.5 3,189.5 5.7 (3,037.8) 936.5
Segment liabilities 343.3 117.4 22.6 64.4 2,097.5 6.5 (2,148.6) 503.1
Capital expenditure 23.3 23.1 0.3 3.2 2.0 - - 51.9
¹ Total depreciation of US$40.5 million included in the segmental result
comprises depreciation incurred at the Cullinan Mine US$23.0 million, Finsch
US$9.1 million, Koffiefontein US$0.1 million, Williamson US$8.0 million and
Corporate and treasury US$0.3 million.
² Operating profit is equivalent to revenue of US$212.1 million less total
costs of US$188.5 million as disclosed in the Consolidated Income Statement.
3 The beneficiation segment represents Tarorite, a cutting and polishing
business in South Africa, which can on occasion cut and polish select rough
diamonds.
SEGMENTAL INFORMATION (continued)
Operating segments South Africa - Mining activities Tanzania United South Africa
-Mining Kingdom
activities
Cullinan Finsch Koffiefontein Williamson Corporate Beneficiation3 Inter-segment Consolidated
US$ million Mine and
treasury
(6 month period ended 31 December 2021) 1 July 1 July 1 July 2021 - 1 July 1 July 1 July 2021 - 1 July 2021 - 1 July 2021
2021 - 2021 - 31 December 2021 - 2021 - 31 December 31 December -
31 31 2021 31 31 2021 2021 31 December
December December December December 2021
2021 2021 2021 2021
Revenue 167.7 65.7 11.1 20.2 - - - 264.7
Segment result¹ 97.2 10.9 (4.8) 10.1 (5.2) (1.0) (0.6) 106.6
Impairment charge - operations - - (0.3) - - - - (0.3)
Impairment reversal / (charge) - other - - - (0.7) 1.1 - - 0.4
receivables
Other direct income / (loss) (0.1) 0.1 0.2 0.1 0.6 - - 0.9
Operating profit / (loss)² 97.1 11.0 (4.9) 9.5 (3.5) (1.0) (0.6) 107.6
Financial income 11.4
Financial expense (56.3)
Income tax charge (13.6)
Non-controlling interest (5.9)
Profit attributable to equity holders 43.2
of the parent company
Segment assets 509.2 221.3 12.1 93.3 3,373.5 4.1 (3,119.2) 1,094.3
Segment liabilities 483.5 114.7 31.1 52.5 2,137.5 4.9 (2,171.6) 652.6
Capital expenditure 12.5 2.5 0.3 0.8 0.6 - - 16.7
¹ Total depreciation of US$42.9 million included in the segmental result
comprises depreciation incurred at the Cullinan Mine US$27.2 million, Finsch
US$12.7 million, Koffiefontein US$0.1 million, Williamson US$2.6 million and
Corporate and treasury US$0.3 million.
² Operating profit is equivalent to revenue of US$264.7 million less total
costs of US$157.1 million as disclosed in the Consolidated Income Statement.
3 The beneficiation segment represents Tarorite, a cutting and polishing
business in South Africa, which can on occasion cut and polish select rough
diamonds.
4. SEGMENTAL INFORMATION (continued)
Operating segments South Africa - Mining activities Tanzania United South Africa
-Mining Kingdom
activities
Cullinan Finsch Koffiefontein Williamson Corporate Beneficiation3 Inter-segment Consolidated
US$ million Mine and
treasury
(12 month period ended 30 June 2022) 2022 2022 2022 2022 2022 2022 2022 2022
Revenue¹ 322.4 165.7 21.5 75.9 - 2.2 (2.5) 585.2
Segment result2 154.4 34.8 (13.8) 22.2 (14.1) 0.4 (4.3) 179.6
Impairment charge - operations - - (0.3) 21.4 - - - 21.1
Impairment reversal / (charge) - other - - - (4.1) 2.6 - - (1.5)
receivables
Other direct income (0.7) (0.4) 0.2 0.1 0.6 - - (0.2)
Operating profit / (loss)² 153.7 34.4 (13.9) 39.6 (10.9) 0.4 (4.3) 199.0
Financial income 19.0
Financial expense (92.1)
Income tax charge (37.8)
Non-controlling interest (19.1)
Profit attributable to equity holders 69.0
of the parent company
Segment assets 463.9 229.8 6.0 123.2 3,575.2 5.1 (3,292.3) 1,110.9
Segment liabilities 384.0 111.2 17.1 75.1 2,430.1 5.9 (2,391.0) 632.4
Capital expenditure 35.0 12.0 0.6 3.3 1.6 - (0.3) 52.2
¹ The Group's revenue comprises the sale of rough diamonds and polished stones.
The sale of rough diamonds contributed US$581.9 million with polished stones
contributing US$3.3 million. Included within the US$3.3 million polished stones
contribution is US$1.1 million from a profit share agreement.
2 Total depreciation of US$82.8 million included in the segmental result
comprises depreciation incurred at the Cullinan Mine US$52.5 million, Finsch
US$24.4 million, Koffiefontein US$0.3 million, Williamson US$5.0 million and
Corporate and treasury US$0.6 million.
3 Operating profit is equivalent to revenue of US$585.2 million less total
costs of US$386.2 million as disclosed in the Consolidated Income Statement.
4 The beneficiation segment represents Tarorite, a cutting and polishing
business in South Africa, which can on occasion cut and polish select rough
diamonds.
US$ million 1 July 2022 1 July 2021 1 July 2021
- - - 30 June
31 31 2022
December December
2022 2021
5. CORPORATE EXPITURE
Corporate expenditure includes:
Depreciation of property, plant and 0.3 0.3 0.6
equipment
Amortisation of right-of-use asset 0.1 0.1 0.2
London Stock Exchange and other 0.6 0.8 1.5
regulatory expenses
Transaction costs - redemption of Notes 0.8 - -
Settlement (reversal) / costs - human (0.8)
rights claims at Williamson - (0.2)
Share-based expense - Directors 0.9 0.1 1.1
Other staff costs 2.4 1.4 5.1
Total staff costs 3.3 1.5 6.2
6. FINANCING EXPENSE
US$ million
1 July 2022 1 July 2021 1 July 2021
- - - 30 June
31 31 2022
December December
2022 2021
Net unrealised foreign exchange gains 1.6 - -
Interest received on BEE loans and other 2.1 2.1 4.1
receivables
Interest received bank deposits 1.7 0.5 1.3
Realised foreign exchange gains on the 20.4 8.8 13.6
settlement of foreign loans and forward
exchange contracts
Financial income 25.8 11.4 19.0
Gross interest on senior secured second (13.6) (23.8) (45.3)
lien notes, bank loans and overdrafts
Other debt finance costs, including (1.3) (0.8) (2.3)
facility fees and IFRS 16 charges
Unwinding of present value adjustment for (1.6) (3.0) (5.4)
rehabilitation costs
Net unrealised foreign exchange losses1 - (28.7) (36.5)
Notes redemption premium and acceleration (8.2) - (1.6)
of unamortised bank facility and Notes
costs2
Realised foreign exchange losses on the (28.1) - (1.0)
settlement of foreign loans and forward
exchange contracts
Financial expense (52.8) (56.3) (92.1)
Net financial expense (27.0) (44.9) (73.1)
1 .The Group predominantly enters into hedge contracts where the risk being
hedged is the volatility in the South African Rand, Pound Sterling and US
Dollar exchange rates affecting the proceeds in South African Rand of the
Group's US Dollar denominated diamond tenders. The fair value of the Group's
hedges as at the end of the Period are based on Level 2 mark-to-market
valuations performed by the counterparty financial institutions. The contracts
are all short dated in nature and mature within the next 12 months. A weakening
of the South African Rand against the US Dollar from ZAR16.27 (30 June 2022) to
ZAR17.00 (31 December 2022) resulted in an unrealised gain of US$1.6 million
(30 June 2022: US$36.5 million unrealised loss and 31 December 2021: US$28.7
million unrealised loss) comprising an unrealised gain on foreign exchange
contracts held at Period end of US$1.9 million (30 June 2022: US$0.7 million
and 31 December 2021: US$0.1 million) and losses on inter-group foreign
denominated loans of US$0.3 million (30 June 2022: US$37.2 million and 31
December 2021: US$28.8 million); and a net realised foreign exchange loss of
US$7.7 million (30 June 2022: US$12.6 million realised gain and 31 December
2021: US$8.8 million realised gain) comprising US$20.4 million (30 June 2022:
US$13.6 million and 31 December 2021: US$8.8 million) in respect of foreign
exchange contracts closed during the Period and US$28.1 million in respect of
realised foreign exchange losses on settlement of foreign loans, is included in
the net finance and expense amount.
2 The Notes redemption premium and acceleration of unamortised bank facility
and Notes costs of US$8.2 million relate to the costs associated with the
tender offer to Noteholders during the Period (30 June 2022: early settlement
of RCF), comprising unamortised upfront costs of US$6.8 million (31 December
2021: US$nil and 30 June 2022: US$1.6 million) previously capitalised and the
make-whole premium of US$1.4 million.
7. PROPERTY, PLANT AND EQUIPMENT
The net movement in property, plant and equipment for the Period is a decrease
of US$13.0 million (30 June 2022: US$63.6 million decrease and 31 December
2021: US$70.2 million decrease). This is primarily as a result of:
1 July 2022 - 1 July 2021 - 1 July 2021
US$ million 31 December 31 December -
2022 2021 30 June
2022
As at 1 July 633.2 696.8 696.8
Foreign exchange movement (24.8) (75.4) (83.4)
Additions 51.9 16.7 52.2
Reconsolidation of non-current
assets held for sale (including
reversal of IFRS 5 impairment) - 31.2 52.6
relating to Williamson
Change in rehabilitation assets 0.7 0.8 -
Depreciation (40.5) (42.9) (82.8)
Impairments (0.3) (0.3) (0.3)
Disposals - (0.3) (1.9)
As at 30 June 620.2 626.6 633.2
8. LOANS AND BORROWINGS
US$ million 31 December 31 December 30 June
2022 2021 2022
Non-current liabilities
Loans and borrowings - Senior secured second 221.1 346.4 353.9
lien notes
Loans and borrowings - Senior secured lender - 51.6 -
debt facilities
221.1 398.0 353.9
Current liabilities
Loans and borrowings - senior secured lender 20.6 27.0 12.3
debt facilities
Loans and borrowings - premium financing - 0.3 -
20.6 27.3 12.3
Total loans and borrowings - bank facilities 241.7 425.3 366.2
Significant non-cash transactions
US$ million 1 July 2022 1 July 2021 1 July 2021
- - -
31 31 30 June
December December 2022
2022 2021
Senior secured second lien notes and secured
debt facilities:
As at 1 July 366.2 430.2 430.2
Cash payments (144.6) (18.7) (103.7)
Non-cash:
Acceleration of unamortised transaction 6.8 - (1.6)
costs
Interest accrued during the period 13.3 25.0 44.4
Effect of foreign exchange - (11.2) (3.1)
241.7 425.3 366.2
a) US$336.7 million Senior Secured Second Lien Notes
A wholly owned subsidiary of the Company, Petra Diamonds US$ Treasury Plc,
issued debt securities consisting of US$336.7 million five-year senior secured
second lien loan notes ("Notes"), with a maturity date of 8 March 2026. The
Notes are guaranteed by the Company and by the Group's material subsidiaries
and are secured on a second lien basis on the assets of the Group's material
subsidiaries. The Notes carry a coupon from:
* 9 March 2021 to 31 December 2022 of 10.50% per annum, which is capitalised
to the outstanding principal amount semi-annually in arrears on 31 December
and 30 June of each year;
* 1 January 2023 to 30 June 2023 of 10.50% per annum on 37.7778% of the
aggregate principal amount outstanding, which is capitalised to the
outstanding principal amount semi-annually in arrears on 31 December and 30
June of each year and 9.75% per annum on 62.2222% of the aggregate
principal amount outstanding which is payable in cash semi-annually in
arrears on 31 December and 30 June of each year;
* 1 July 2023 to 31 December 2025 of 9.75% per annum on the aggregate
principal amount outstanding which is payable in cash semi-annually in
arrears on 31 December and 30 June of each year; and
* 1 January 2026 to 8 March 2026 (final coupon payment) of 9.75% per annum on
the aggregate principal amount outstanding which is payable in cash
On 27 September 2022, the Group repaid, through a debt tender offer to
Noteholders, an amount of US$143,627,622, comprising the principal amount of
US$125,590,338 and PIK interest of US$18,037,284. On 12 October 2022 a further
US$1,000,667 was repaid to Noteholders comprising the principal amount of
US$875,000 and PIK interest of US$125,667. The principal amount of Notes
outstanding after the repayments to Noteholders is US$210,190,662. Cash costs
of US$1,446,283 relating to the repayment of Noteholders have been expensed in
the Consolidated Income Statement under finance expense (refer to Note 6).
The Group performed an assessment under its accounting policies and the
requirements of IFRS 9 as to whether the debt tender offer to the Noteholders
represented a substantial modification. A qualitative test was performed which
determined the terms of the Notes, repayment profile and interest rate were not
amended or modified as part of the tender offer process therefore, no
substantial modification was relevant.
The remaining costs associated with issuing the Notes of US$13.9 million, after
adjusting for the acceleration of US$6.8 million of unamortised costs
associated with the debt tender offer to Noteholders which have been expensed
through profit and loss within net finance expense (refer to note 6) have been
capitalised against the principal amount and US$11.5 million remains
unamortised as at 31 December 2022 (30 June 2022: US$18.5 million and 31
December 2021: US$19.4 million). Interest of US$43.0 million has been accrued
as at 31 December 2022.
Further details about the Notes (including security) have been included in the
Group's FY 2022 Annual Report.
b) Senior Secured Lender Debt Facilities
In June 2022, the Group restructured its existing banking facilities providing
for more favourable terms than the Group's current first lien facilities and
resulting in Absa Corporate and Investment Banking ("Absa") becoming the
Group's banking partner under the new banking facilities.
A new Revolving Credit Facility ("RCF") of ZAR1 billion (US$58.8 million) with
Absa replaced the previous RCF and term lending arrangements with the previous
South African lender syndicate comprising Absa, Nedbank, RMB and NinetyOne.
The terms under the RCF are:
* maturity date December 2025 with a 60 day buffer between the redemption of
the Notes and the maturity of the RCF:
* interest rate of SA JIBAR + 4.15% per annum (with the margin to be
reconsidered annually based on Petra's credit metrics with a view of
further optimising the margin to be achieved) and
* certain covenant ratios as mentioned below.
.
The Group's debt and hedging facilities are detailed in the table below:
Senior Lender Debt Facilities 31 December 31 December 30 June
2022 2021 2022
Facility Facility Facility
amount amount amount
ZAR Debt Facilities:
ZAR Lenders RCF ZAR1.0 billion ZAR408.8 ZAR1.0 billion
million
ZAR Lenders Term loan ZAR nil ZAR876.4 ZAR nil
million
Absa/RMB - FX Hedging facilities ZAR300 million ZAR150 million ZAR300 million
The terms and conditions of the Group facilities are detailed in the Group's FY
2022 Annual Report.
The facilities are secured on the Group's interests in the Cullinan, Finsch and
Koffiefontein Mines.
As at date of this report, the RCF was undrawn and ZAR1.0 billion (US$58.8
million) remained available for drawdown. During FY2022, the Company paid
ZAR404.6 million (US$24.9 million) (capital plus interest) to settle the old
RCF and ZAR893.2 million (US$54.9 million) (capital plus interest) to settle
the previous Term Loan.
Covenant ratios
As part of the revised RCF facility entered into with ABSA in FY2022, the
Company is required:
* to maintain a Net Debt : Adjusted EBITDA ratio tested semi-annually on a
rolling 12-month basis;
* to maintain an Interest Cover Ratio tested semi-annually on a rolling
12-month basis and
* to maintain minimum 12 month forward looking liquidity requirement that
consolidated cash and cash equivalents (excluding diamond debtors) shall
not fall below US$20.0 million.
The Company's new covenant levels for the respective measurement periods are
outlined below:
FY22 H2 FY23 H1 FY23 H2 FY24 H1 FY24 H2 FY25 H1 FY25 H2 FY26 H1
Consolidated net debt :
EBITDA Leverage ratio 4.00 4.00 3.50 3.50 3.25 3.25 3.00 3.00
(maximum)
1.85 1.85 2.50 2.50 2.75 2.75 3.00 3.00
Interest Cover Ratio
(minimum)
The covenants were not in breach at the measurement date.
9. COMMITMENTS
As at 31 December 2022, the Company had committed to future capital expenditure
totalling US$55.1 million (30 June 2022: US$49.5 million and 31 December 2021:
US$33.8 million), mainly comprising the Cullinan Mine US$30.1 million (30 June
2022: US$25.2 million 31 December 2021: US$25.3 million), Finsch US$24.8
million (30 June 2022: US$23.7 million 31 December 2021: US$8.3 million),
Koffiefontein US$nil (30 June 2022: US$0.3 million 31 December 2021: US$0.2
million) and Williamson US$0.2 million (30 June 2022: US$0.3 million and 31
December 2021: US$nil).
10. RELATED PARTY TRANSACTIONS
The Group's related party BEE partners, Kago Diamonds (Pty) Ltd ("Kago
Diamonds") and its gross interests in the mining operations of the Group are
disclosed in the table below.
Mine Partner and respective Partner and respective Partner and respective
interest interest interest
as at 31 December 2022 as at 31 December 2021 as at 30 June 2022 (%)
(%) (%)
Cullinan Kago Diamonds (14%) Kago Diamonds (14%) Kago Diamonds (14%)
Finsch Kago Diamonds (14%) Kago Diamonds (14%) Kago Diamonds (14%)
Koffiefontein Kago Diamonds (14%) Kago Diamonds (14%) Kago Diamonds (14%)
The Itumeleng Petra Diamonds Employee Trust ("IPDET") holds a 12% interest in
each of the Group's South African operations, with Petra's commercial BEE
Partners holding the remaining 14% interest through their respective
shareholdings in Kago Diamonds, in which Petra has a 31.46% interest. The
effective interest percentages attributable to the remaining operations for the
Group's shareholders is 78.4%.
The non-current loans receivable, non-current loans payable, finance income and
finance expense, due from and due to the related party BEE partners and other
related parties, including dividends paid are disclosed in the table below:
US$ million 31 December 31 December 30 June 2022
2022 2021
Non-current receivable
Kago Diamonds1 21.8 27.1 26.6
27.1 26.6
Current trade and other
receivables
KEM JV2 3.3 5.5 3.7
Impairment provision2 (2.0) (4.9) (2.0)
1.3 0.6 1.7
1 July 2022 - 1 July 2021 - 1 July 2021 -
31 December 31 December 30 June 2022
2022 2021
Finance income
Kago Diamonds 1.0 1.0 2.1
1.0 1.0 2.1
Dividend paid
Kago Diamonds3 1.2 1.3 1.3
1.2 1.3 1.3
¹ The movement in the Kago Diamonds receivable of US$4.8 million (30 June 2022:
US$6.9 million and 31 December 2021: US$6.4 million) is mainly attributable to
repayments received from Kago Diamonds during the Period totalling US$3.6
million (30 June 2022: US$nil and 31 December 2021: US$nil) and a foreign
exchange decrease of US$1.2 million (30 June 2022: US$4.1 million decrease and
31 December 2021: US$3.6 million decrease).
2 Included in current trade and other receivables are amounts advanced to KEM
JV in respect of a working capital facility and equipment finance facility of
US$1.3 million (30 June 2022: US$1.7 million and 31 December 2021: US$0.6
million) and the balance of the KEM JV purchase consideration of US$nil (30
June 2022: US$nil and 31 December 2021: US$nil). During H1 FY 2023 the Group
received payments of US$0.3 million (FY 2022: US$2.5 million and FY H1 2022:
US$1.2 million) from the KEM JV as settlement of the outstanding purchase
consideration this did not result in any further expected credit loss reversal
during the Period as the full reversal was accounted for in prior periods (FY
2022: US$2.9 million and H1 FY2022: US$1.1 million). The Group has applied the
expected credit loss impairment model to the KEM JV receivables, taking into
account various factors, and the expected credit loss was deemed to be US$2.0
million (30 June 2022: US$2.0 million and 31 December 2021: US$4.9 million).
3 During the Period, Finsch declared and paid a dividend out of profits
generated in FY2022 to its shareholders. The BEE partners received a gross
dividend of US$9.8 million (30 June 2022: US$2.5 million). An amount of US$6.3
million (30 June 2022: US$0.2 million) was used by BEE partners to repay a
portion of their loans owing to the Group and a net cash payment of US$2.2
million (30 June 2022: US$2.5 million) was received by the BEE partners,
comprising Kago US$1.2 million (30 June 2022: US$1.3 million) and IPDET US$1.0
million (30 June 2022: US$1.2 million).
11. BEE LOANS RECEIVABLE
US$ million 31 December 31 December 30 June
2022 2021 2022
Non-current assets
Loans and other receivables 38.2 43.1 44.6
BEE Loans Receivable
The non-current BEE loans receivable represents those amounts receivable from
the Group's BEE Partners (Kago Diamonds and the IPDET) in respect of advances
historically provided to the Group's BEE Partners to enable them to discharge
interest and capital commitments under the BEE Lender facilities, advances to
the BEE Partners to enable trickle payment distributions to both Kago Diamonds
shareholders and to the beneficiaries of the IPDET (Petra Directors and Senior
Managers do not qualify as beneficiaries under the IPDET Trust Deed), and
financing of their interests in the Koffiefontein mine. In addition, US$40.2
million (30 June 2022: US$42.0 million and 31 December 2021: US$48.6 million)
has been recorded as part of the gross receivable (before expected credit loss
provisions) in respect of amounts to be reimbursed to the Group in respect of
the guarantee under the BEE Lender facilities. Judgement was required in
determining the extent to which reimbursement is applicable based on the terms
of the agreements, South African legislation and discussions with the BEE
partners.
As a result of historical delays in the Cullinan Mine plant ramp-up and the
Finsch SLC ramp-up, the Group has historically and through the Period elected
to advance the BEE Partners' funds using Group treasury to enable the BEE
Partners to service their interest and capital commitments under the BEE Lender
facilities (refer below). These BEE receivables, including interest raised,
will be recoverable from the BEE Partners' share of future cashflows from the
underlying mining operations. As part of a previous Debt Restructuring in
FY2021, Petra has assumed the BEE Lender facility obligations
For detail on expected credit loss provision and reversal associated with the
BEE loans receivable refer to note 2.
1 July 2022 - 1 July 2021 - 1 July 2021 -
US$ million 31 December 31 December 30 June 2022
2022 2021
As at 1 July 44.6 46.6 46.6
Foreign exchange movement on
opening balance (2.0) (5.1) (5.9)
Interest receivable 1.9 2.0 4.1
Reversal of BEE loans -
receivable - expected credit - -
loss provision
Repayment of loan from BEE (6.3) (0.4) (0.2)
partner
As at 30 June 38.2 43.1 44.6
12. SHARES ISSUED AND SHARE PREMIUM
During the Period, there were no new shares issued by the Company.
On 16 November 2022, at the FY 2022 Annual General Meeting, the Company's
shareholders approved the Company's share premium account be reduced by US$350
million with such amount being credited against accumulated losses with the
balance being credited to the Company's other distributable reserves.
Share premium Accumulated
US$ million reserves /
(losses)
As at 1 July 2022 959.5 (183.6)
Conversion of share premium to distributable reserves (350.0) 350.0
Movement during period - (23.7)
As at 31 December 609.5 142.7
In FY 2022, at the FY 2021 Annual General Meeting the Company's shareholders
approved a 50 for 1 Share Consolidation. Admission of the Company's New
Ordinary Shares took place on 29 November 2021. As a result of the Share
Consolidation, the Company's shares in issue comprise of 194,201,785 ordinary
shares of 0.05 pence each.
13. EARNINGS PER SHARE
Total Total
1 July 2022 - 31 1 July 2021 - 31 Total
December 2022 December 2021 1 July 2021 - 30
US$ US$ June 2022
US$
Numerator
(Loss) / profit for the Period (23,752,879) 43,288,096 68,995,537
Denominator
Shares Shares Shares
Weighted average number of ordinary shares used in basic EPS
Brought forward 194,201,785 9,710,089,272 9,710,089,272
Effect of shares issued during the Period - - -
Effect of 50 for 1 share consolidation November 2021 - (9,515,887,487) (9,515,887,487)
Carried forward 194,201,785 194,201,785 194,201,785
Shares Shares Shares
Dilutive effect of potential ordinary shares - - -
Weighted average number of ordinary shares in issue used in diluted EPS 194,201,785 194,201,785
194,201,785
US cents US cents US cents
Basic (loss) / profit per share - US cents (12.23) 22.29 35.53
Diluted (loss) / profit per share - US cents (12.23) 22.29 35.53
The number of potentially dilutive ordinary shares, in respect of employee
share options, Executive Director and Senior Management share award schemes is
nil (30 June 2022: nil and 31 December 2021: nil).
14. ADJUSTED EARNINGS PER SHARE (non-GAAP measure)
In order to show earnings per share from operating activities on a consistent
basis, an adjusted earnings per share is presented which excludes certain items
as set out below. It is emphasised that the adjusted earnings per share is a
non-GAAP measure. The Petra Board considers the adjusted earnings per share to
better reflect the underlying performance of the Group. The Company's
definition of adjusted earnings per share may not be comparable to other
similarly titled measures reported by other companies.
Total Total
1 July 2022 - 31 1 July 2021 - 31 Total
December 2022 December 2021 1 July 2021 - 30
US$ US$ June 2022
US$
Numerator
(Loss) / profit for the Period (23,752,879) 43,288,096 68,995,537
Net unrealised foreign exchange (gain) / loss (1,695,466) 22,015,553 34,851,735
Present value discount - Williamson VAT receivable 3,473,980 663,803 4,076,760
Impairment (reversal) / charge - operations* 216,437 227,304 (21,206,735)
Impairment (reversal) / charge - other receivables 1,176 (1,118,250) (2,544,704)
Taxation (credit) / charge on unrealised foreign exchange (gain) / (138,605) (8,507,107) (1,618,908)
loss
Taxation credit on impairment charge* - - -
Transaction costs and acceleration of unamortised costs on Notes and 9,015,171 - 1,628,757
restructured bank facilities
Williamson tailings facility - remediation costs 5,897,182 - -
Williamson tailings facility - accelerated depreciation 5,220,536 - -
Transaction costs (reversal) / expense - Human rights settlement - (239,494) (816,270)
agreement and provisions for unsettled and disputed tax claims
Adjusted loss for the Period attributable to parent (1,762,468) 56,329,905 83,366,172
*Portion attributable to equity shareholders of the Company
Denominator
Shares Shares Shares
Weighted average number of ordinary shares used in basic EPS
As at 1 July 194,201,785 9,710,089,272 9,710,089,272
Effect of shares issued during the Period - - -
Effect of 50 for 1 share consolidation November 2021 - (9,515,887,487) (9,515,887,487)
Carried forward 194,201,785 194,201,785 194,201,785
Shares Shares Shares
Dilutive effect of potential ordinary shares - - -
Weighted average number of ordinary shares in issue used in diluted 194,201,785 194,201,785 194,201,785
EPS
US cents US cents US cents
Adjusted basic profit / (loss) per share - US cents (0.91) 29.01 42.93
Adjusted diluted profit / (loss) per share - US cents (0.91) 29.01 42.93
15. IMPAIRMENT CHARGE
The current market conditions in the global rough diamond market, volatility of
and variability in product mix are all factors impacting the rough diamond
prices achieved by Petra during the Period, and the tailings facility failure
at Williamson which have resulted in management taking a critical review of the
Group's business models and operational assets. The carrying amounts of the
Group's assets are reviewed at each reporting date to determine whether there
is any indication of impairment. If there is any indication that an asset may
be further impaired or an impairment reversal may apply, its recoverable amount
is estimated. The recoverable amount is determined on a fair value less cost to
develop basis.
During the Period under review, the Group reviewed the carrying value of its
investments, loan receivables and operational assets for indicators of
impairment. Following the assessment, no further impairment of property, plant
and equipment was considered appropriate for the Cullinan, Finsch and
Williamson Mines, nor was any impairment reversal considered appropriate in the
current Period. The Group recognised an asset level impairment charge of US$0.3
million being managements' estimate of the decrease in the value of the
Koffiefontein assets. The Group also recognised a non-financial receivables
charge of US$3.5 million, being management's estimate of the impact on the
recoverability of the Tanzania VAT receivable.
Impairment Asset class Carrying Impairment Carrying value
(US$ million) value pre post
impairment impairment
Impairment
operations:
Cullinan Mine Property, plant & equipment 402.3 - 402.3
Finsch Property, plant & equipment 165.4 - 165.4
Koffiefontein Property, plant & equipment 1.0 (0.3) 0.7
Williamson Property, plant & equipment 46.6 - 46.6
Sub-total 615.3 (0.3) 615.0
Impairment -
non-financial
receivables:
Other - Tanzania VAT receivable 8.6 (3.5) 5.1
non-current (refer to note 2)
Sub-total 8.6 (3.5) 5.1
Total 623.9 (3.8) 620.1
31 December 2021
During the 6 month period ending 31 December 2021, the Group reviewed the
carrying value of its investments, loan receivables and operational assets for
indicators of impairment. Following the assessment, no impairment of property,
plant and equipment was considered appropriate for the Cullinan, Finsch, and
Williamson Mines, nor was any impairment reversal considered appropriate in the
Period. The Group recognised an asset level impairment charge of US$0.3 million
being managements' estimate of the decrease in the value of the Koffiefontein
assets. The Group also recognised a non-financial receivables impairment
reversal of US$0.4 million, comprising US$0.7 million impairment charge being
management's estimate of the recoverability of the Tanzania VAT receivable and
an impairment reversal of US$1.1 million of the KEM JV receivable.
Details of the impairment assessment are shown below:
Impairment Asset class Carrying Impairment Carrying value
(US$ million) value pre post
impairment impairment
Impairment
operations:
Cullinan Mine Property, plant & equipment 429.2 - 429.2
Finsch Property, plant & equipment 163.7 - 163.7
Koffiefontein Property, plant & equipment 1.1 (0.3) 0.8
Williamson Property, plant & equipment 30.0 - 30.0
Sub-total 624.0 (0.3) 623.7
Impairment -
non-financial
receivables:
Other - current KEM JV receivable 1.5 1.1 2.6
receivable
Other - non-current Tanzania VAT receivable 2.5 (0.7) 1.8
Sub-total 4.0 0.4 4.4
Total 628.0 0.1 628.1
30 June 2022
The operations of the Cullinan, Finsch, Koffiefontein and Williamson Mines are
held at recoverable value as a result of FY 2021 impairments. During FY 2022,
the Group reviewed the carrying value of its investments, loan receivables and
operational assets for indicators of impairment. Following the assessment, no
further impairment of property, plant and equipment was considered appropriate
for the Cullinan, Finsch and Williamson Mines, nor was any impairment reversal
considered appropriate in the current Year. The Group recognised an asset level
impairment charge of US$0.3 million being managements' estimate of the decrease
in the value of the Koffiefontein assets. The Group also reversed a Group level
impairment charge relating to Williamson, previously recognised under IFRS 5,
of US$21.4 million as Williamson is no longer considered an asset held for
sale. The Group recognised a non-financial receivables charge of US$1.5 million
comprising an impairment charge of US$4.1 million being management's estimate
of the recoverability of the Tanzania VAT receivable, an impairment charge of
US$0.3 million related to other receivables and an impairment reversal of
US$2.9 million of the KEM JV receivable.
Impairment Asset class Carrying Impairment Carrying value
(US$ million) value pre post
impairment impairment
Impairment
operations:
Cullinan Mine Property, plant & 419.9 - 419.9
equipment
Finsch Property, plant & 157.9 - 157.9
equipment
Koffiefontein Property, plant & 1.1 (0.3) 0.8
equipment
Williamson Property, plant & 29.3 21.4 50.7
equipment
Sub-total 608.2 21.1 629.3
Impairment -
non-financial
receivables:
Other - current KEM JV receivable (1.2) 2.9 1.7
receivable
Other - current Other receivables 0.3 (0.3) -
receivable
Other - non-current Tanzania VAT receivable 6.8 (4.1) 2.7
Sub-total 5.9 (1.5) 4.4
Total 614.1 19.6 633.7
Cullinan, Finsch, Koffiefontein and Williamson Mine impairment considerations
and assumptions
The Group performs impairment testing on an annual basis of all operations and
when there are potential indicators of impairment. The impairment testing
performed resulted in impairments of the Cullinan Mine, Finsch, Koffiefontein
and Williamson assets. The key assumptions used in determining the recoverable
value calculations, determined on fair value less cost to develop basis, are
listed in the table below:
Group assumptions for 31 December 2022 and 30 June 2022:
Key assumptions Explanation
Current mine plan and Economically recoverable reserves and resources are based on
recoverable value of management's expectations based on the availability of reserves
reserves and resources and resources at mine sites and technical studies undertaken in
house and by third party specialists.
The end of life of mine based on current mine plans for the
operations are as follows:
Cullinan Mine: FY 2033 (FY 2022: FY 2031)
Finsch: FY 2031 (FY 2022: FY 2030)
Koffiefontein: FY 2025 (FY 2022: FY 2025) - current production
has ceased and the operation has been placed on care and
maintenance
Williamson: FY 2030
Resources remaining after the current mine plans have not been
included in impairment testing for the operations.
Current mine plan reserves Cullinan Mine: Current mine plan over the next ten years; total
and resources resource processed 37.6 Mt (FY 2022: Current mine plan over the
next nine years; total resource processed 36.4 Mt). Cullinan
Mine is implementing a project for 2 additional tunnels (46 and
50) resulting in an increase in reserves and mine plan.
Finsch: Current mine plan over the next nine years; total
resource processed 23.7 Mt (FY 2022: Current mine plan over the
next nine years; total resource processed 23.2 Mt). Additional
SLC project approved taking mining to 90L approved during H1 FY
2023.
Koffiefontein has been put on care and maintenance and has
ceased production.
Williamson: Current mine plan over the next eight years, total
resource processed 38.0 Mt (FY2022: Current mine plan over the
next eight years, total resource processed 43.3 Mt).
Current mine plans - Management has estimated the timing and quantum of the capital
capital expenditure expenditure based on the Group's current mine plans for each
operation. There is no inclusion of capital expenditure to
enhance the asset beyond exploitation of the current mine plan
orebody.
Residual Value Cullinan Mine: Management included a residual value of
property, plant and equipment to be used beyond the current
mine plan, given the significant resource base estimated to be
available at the end of the current mine plan.
No residual values were included in the impairment assessments
of the other mining operations due to the mine plan aligning
with the resource base estimated to be available at the end of
the current mine plan.
Diamond prices The diamond prices used in the impairment test have been set
with reference to recently achieved pricing and market trends,
and long-term diamond price escalators are informed by industry
views of long-term market supply/demand fundamentals. Given the
current market uncertainty, the assessment of short-term
diamond prices and the rate and extent of pricing recovery,
together with the longer-term pricing escalators, represented a
critical judgement.
The 31 December 2022 impairment testing models starting price
assumptions have been adjusted to reflect the improved pricing
achieved during the FY2022. Diamond prices (excluding
Exceptional Stones) have been assumed to remain unchanged
during FY2023, then increase by 3.9% from FY2024 onwards. The
long-term models incorporate normalised diamond price
escalation of 1.9% above a long-term US inflation rate of 2.0%
per annum from FY 2024 to FY 2030. Estimates for the
contribution of Exceptional Diamonds sold for more than US$5.0
million each are determined with reference to historical
trends. Based on the historical trends, management have
retained the contribution from Exceptional Stones at the
Cullinan Mine at US$35.0 million per annum.
The 30 June 2022 impairment testing models starting price
assumptions have been adjusted to reflect the improved pricing
achieved during the Year when compared to the 30 June 2021
impairment models. Diamond prices (excluding Exceptional
Stones) have been assumed to remain unchanged during FY2023,
then increase by 3.9% from FY2024 onwards. The long-term models
incorporate normalised diamond price escalation of 1.9% above a
long-term US inflation rate of 2.0% per annum from FY 2024 to
FY 2030. Estimates for the contribution of Exceptional Diamonds
sold for more than US$5.0 million each are determined with
reference to historical trends. Based on the historical trends,
management have increased the contribution from Exceptional
Stones at the Cullinan Mine from US$25.0 million to US$35.0
million per annum.
Discount rate A ZAR discount rate of 13.0% (30 June 2022: 13.0%) was used for
the South African operations and a USD discount rate of 14.0%
(30 June 2022: 14.00%) for Williamson. Discount rates
calculated based on a nominal weighted average cost of capital
including the effect of factors such as market risk and country
risk as at the Year end. USD and ZAR discount rates are applied
based on respective functional currency of the cash generating
unit.
Cost inflation rate Long-term inflation rates of 3.5%-8.0% (30 June 2022:
3.5%-7.5%) above the long-term US$ inflation rate were used for
Opex and Capex escalators. Management have taken into account
the current short-term pressures in the inflation environment
and the impact on Opex and capex costs, allowing for the
inflation rate to normalise over the longer-term.
Exchange rates Exchange rates are estimated based on an assessment of current
market fundamentals and long-term expectations. The US$/ZAR
exchange rate range used for all South African operations
commenced at ZAR17.00 (30 June 2022: ZAR16.04) for H2 FY2023
reflecting the current volatility, inflationary pressures and
quantitative tightening by Central banks, and ZAR16.75 for
FY2024 and thereafter devaluing at 3.5% per annum. Given the
volatility in the USD/ZAR exchange rate and the current levels
of economic uncertainty, the determination of the exchange rate
assumptions required significant judgement.
Valuation basis Discounted present value of future cash flows.
Williamson For impairment testing at Williamson, management used the above
assumptions, noting that no sales were forecast for H2 FY2023
following the TSF breach in November 2022. Accelerated
depreciation of US$5.2 million attributable to the TSF assets
has been included in the depreciation charge in mining and
processing costs. During the FY2022, Williamson recommenced
production.
Sensitivity analysis
The impact of applying reasonable downside sensitivities on the key inputs
based on management's assumptions at 31 December 2022 is noted below:
Additional Impairment charge
(US$ million) Cullinan Finsch¹ Koffiefontein Williamson
Mine ²
Base case
Increase in discount rate by 2% 32.7 - n/a 4.8
Reduction in pricing by 5% over 40.5 - n/a 19.8
Life of Mine
Reduction in short-term production 25.8 23.1 n/a 13.6
by 10%
Increase in Opex by 5% 20.5 - n/a 9.6
Reduction in Exceptional Stones 43.6 n/a n/a n/a
contribution by US$10.0 million per
annum
Strengthening of the ZAR from US$/ 47.3 - n/a n/a
ZAR17.00 to US$/ZAR16.15
1. Additional impairments will occur at Finsch if the discount rate is
increased by 4%, or a reduction in pricing by 6.5% over Life of Mine, or an
increase in Opex of 13.5% and or a strengthening of the US$/ZAR from R17.00
to US$/ZAR 15.81.
2. Production at Koffiefontein has ceased and the operation has been placed on
care and maintenance.
16. WILLIAMSON (30 June 2022)
a. Framework Agreement
On 13 December 2021, the Company signed an agreement in principle with the
Government of Tanzania relating to the Williamson operations. Williamson
resumed operations and sales during the Period, having been on care and
maintenance since April 2020.
The Framework Agreement provides for a capital restructuring of the Williamson
Diamonds Limited ("WDL"), the entity that owns the Williamson Mine, including
the 16% free carried interest that the Government of Tanzania is entitled to
receive in WDL and its shareholder loans under Section 10 of the Tanzanian
Mining Act, 2017 and Regulation 10 of the Tanzanian Mining (State
Participation) Regulations, 2020. The capital restructuring will include:
* a WDL share issue with the effect of reducing Petra's indirect shareholding
from 75% to 63% and consequently increasing the Government of Tanzania's
shareholding from 25% to 37%;
* a contribution to the Government of Tanzania of 16% of the principal
outstanding value of the Group's shareholder loans payable by WDL, with the
remaining 84% of such principal outstanding loans continuing to be owed to
the Group; and
* the transfer of the WDL shares held by the Group to another member of the
Petra Group (either Petra itself or a special purpose subsidiary). Petra
have registered Mwadui Mining Holdings Ltd, a subsidiary registered in the
United Kingdom, for this purpose.
With respect to the reorganisation of the parties' legal interests in WDL, the
Framework Agreement also provides for an overall 55:45 economic benefit sharing
ratio between the Government of Tanzania and Petra in relation to future
economic benefits from the Williamson Mine. This arrangement is intended to
capture the parties' entitlements as shareholders as well as, with respect to
the Government of Tanzania, the revenue it collects from WDL arising from
taxes, royalties, duties, fees and other fiscal levies ("Government Imposed
Charges"). The Framework Agreement also provides that WDL shall be entitled to
off-set its undisputed unpaid and overdue VAT receivables against future
Government Imposed Charges, whereby such Government Imposed Charges will be
off-set and treated as paid for the purposes of the economic benefit sharing
ratio.
The Framework Agreement provides that Petra and the Government of Tanzania will
provide financial assistance for the restart of operations at the Williamson
Mine. The Government of Tanzania has agreed to allocate the sales proceeds of
the 71,654.45 carat diamond parcel from the Williamson Mine that was previously
confiscated and blocked for export. The original value of this parcel was
assessed in September 2017 at approximately US$15 million, as previously
disclosed, although Petra has not had the parcel independently valued. For
further information on the confiscated diamond parcel refer to note 18.
The Framework Agreement records an important US$20.0 million settlement between
the parties concerning long-standing historic disputes with the Government of
Tanzania. In FY2021, as at 30 June 2021 the Group raised a provision of US$19.5
million (adjusted for time-value of money) in respect of the aforementioned
settlement. This settlement payment shall be made in instalments, with the
first instalment of US$5.0 million to be paid when the Framework Agreement
becomes effective and upon receipt of proceeds by WDL from the sale of the
confiscated diamond parcel. The subsequent annual instalments of the
settlement amount are to be made annually at amounts as determined by WDL's
board of directors.
The Framework Agreement is subject to a number of conditions, including
Tanzanian regulatory approvals and is therefore not yet effective as at 31
December 2022. Certain conditions precedent remain outstanding awaiting
resolution from GoT.
Memorandum of Understanding with Caspian Limited ("MoU")
On 15 December 2021, the Company announced that it had signed a non-binding
Memorandum of Understanding ("MoU") to sell 50% less one share of the entity
that holds the Group's shareholding in Williamson Diamonds Limited ("WDL"),
along with a pro rata portion of shareholder loans owed by WDL, to Caspian
Limited or its nominee ("Caspian") for a total consideration of US$15.0
million. Caspian is the long-term technical services contractor at the
Williamson Mine.
Upon completion of the transactions contemplated by the MoU and the capital
restructuring in the aforementioned Framework Agreement becoming effective,
Petra and Caspian will each indirectly hold a 31.5% stake in WDL but with Petra
retaining a controlling interest in Williamson.
Caspian's purchase will be funded through the settlement of US$15 million of
past technical services payments owed by WDL to Caspian.
The sale of the 50% less 1 share stake in the entity that holds Petra's shares
in WDL is subject to the parties first entering into definitive transaction
agreements and once such agreements are entered into, then obtaining all
necessary Governmental, regulatory and lender approvals, including approvals
from the Tanzanian Mining Commission, the Tanzanian Fair Competition Commission
and The Bank of Tanzania, and a binding ruling from the Tanzania Revenue
Authority on the tax treatment of the transaction.
17. CONTINGENCIES
Williamson - Independent Grievance Mechanism ("IGM")
The IGM is a non-judicial process that has the capacity to investigate and
resolve complaints alleging severe human rights impacts in connection with
security operations at the Williamson mine. It will be overseen by an
Independent Panel of Tanzanian experts taking an approach informed by Tanzanian
law, and with complainants having access to free and independent advice from
local lawyers. The overall aim of the IGM is to promote reconciliation between
the Williamson Diamond Mine, directly affected parties and the broader
community by providing remedy to those individuals who have suffered severe
human rights impacts. The Group has agreed to fund the remedies determined by
the IGM.
On 28 November 2022, the IGM became operational with the commencement of the
IGM's pilot phase. The pilot phase, which is expected to continue until the end
of March 2023, will allow for the IGM's systems and procedures to be further
developed. Where appropriate, the design of the IGM will then be adjusted to
take into account the learnings of the pilot phase.
Whilst the IGM was still being established, a mechanism was set up to enable
community members to confidentially and securely register alleged historical
human rights grievances. This mechanism continued to receive grievances, with a
significant amount of grievances having been registered to date. As the IGM is
currently in its pilot phase, it is too early to evaluate the merits of these
grievances.
Judgement has been applied by management in assessing the merits and outcome of
the grievances. Consideration was given, amongst other things, to the fact that
the IGM remains in the pilot phase and is yet to assess the merits of the
grievances registered. Accordingly, management is of the opinion that the
estimated costs and outcome of the grievance remains uncertain and have
therefore not raised a provision at Period end.
18. EVENTS AFTER THE REPORTING PERIOD
Williamson Blocked Parcel
Subsequent to Period end, it has come to the attention of the Company that a
portion of the blocked diamond parcel of 71,654.45 carats that was confiscated
by the Government of Tanzania ("GoT") in 2017 has recently been sold. Under the
Framework Agreement entered into by the GoT, the Company and WDL in December
2021, the GoT agreed to allocate the proceeds of this blocked diamond parcel to
WDL. The Company is engaging with GoT to confirm the application of the
proceeds.
RESPONSIBILITY STATEMENT
We confirm that to the best of our knowledge:
a) the Condensed Financial Statements have been prepared in accordance with
IAS 34 Interim Financial Reporting, and give a true and fair view of the
assets, liabilities, financial position and profit of the Group; and
b) the Interim Management Report includes a fair review of the information
required by FCA's Disclosure and Transparency Rules (DTR 4.2.7 R and 4.2.8 R).
By order of the Board
Richard Duffy
Chief Executive
Officer
20 February 2023
INDEPENDENT REVIEW REPORT ON THE UNAUDITED FINANCIAL STATEMENTS OF PETRA
DIAMONDS LIMITED
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 31 December 2022 is not prepared, in
all material respects, in accordance with UK adopted International Accounting
Standard 34 and the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 31
December 2022 which comprises Condensed Consolidated Income Statement,
Condensed Consolidated Statement of Comprehensive Income, Condensed
Consolidated Statement of Financial Position, Condensed Consolidated Statement
of Cash Flows, Condensed Consolidated Statement of Changes in Equity and Notes
to the Condensed Consolidated Interim Financial Statements.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the group are
prepared in accordance with UK adopted international accounting standards. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with UK adopted International Accounting
Standard 34, "Interim Financial Reporting.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern that
are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410, however future events or conditions may cause the group to
cease to continue as a going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report in
accordance with the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
In preparing the half-yearly financial report, the directors are responsible
for assessing the company's ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the company
or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the review of the financial information
In reviewing the half-yearly report, we are responsible for expressing to the
Company a conclusion on the condensed set of financial statement in the
half-yearly financial report. Our conclusion, including our Conclusions
Relating to Going Concern, are based on procedures that are less extensive than
audit procedures, as described in the Basis for Conclusion paragraph of this
report.
Use of our report
Our report has been prepared in accordance with the terms of our engagement to
assist the Company in meeting the requirements of the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct Authority and for
no other purpose. No person is entitled to rely on this report unless such a
person is a person entitled to rely upon this report by virtue of and for the
purpose of our terms of engagement or has been expressly authorised to do so by
our prior written consent. Save as above, we do not accept responsibility for
this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
BDO LLP
Chartered Accountants
Location: London UK
20 February 2023
BDO LLP is a limited liability partnership registered in England and Wales
(with registered number OC305127)
END
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