File picture
PETRA Diamonds, the mining company that operates the Finsch mine in the Northern Cape, has announced a leadership shake-up following a widening financial loss of $69 million (roughly R1.27 billion) for the six-month period ending December 2024.
The company confirmed in a statement on Monday that chief restructuring officer Vivek Gadodia and Cullinan mine operations executive Juan Kemp will serve as interim joint CEOs, following the immediate departure of Richard Duffy, who resigned by mutual agreement.
The announcement, as reported by Reuters, comes amid ongoing challenges in the diamond market, with Petra citing prolonged weakness in demand as a key factor in its losses. The company's net debt has also increased, rising from $193 million in June 2024 to $215 million by the end of December.
Despite these financial pressures, Petra reported an improvement in operational free cash flow, shifting from a negative $21 million in the previous period to a positive $16 million. This turnaround is attributed to a cost-cutting initiative and restructuring efforts that saw the company offload its Koffiefontein operations in October and agree to sell the Williamson mine in Tanzania for approximately $16 million in January.
As a result, Petra now retains the renowned Cullinan mine - where the largest gem-quality diamond was discovered 120 years ago - along with the Finsch mine in the Northern Cape.
Petra recently announced plans to reduce its workforce by approximately 200 employees at the Cullinan and Finsch mines as part of its cost-reduction strategy.
This decision has been met with strong opposition from the National Union of Mineworkers (NUM), which argues that the retrenchments will have devastating consequences for the affected employees, their families, and the broader community. The union has called the decision "unacceptable," especially in a country facing high unemployment rates.
ALSO READ: NUM slams Petra Diamonds’ plan to cut 200 jobs amid industry slump
The broader diamond industry has faced difficulties due to fluctuating demand, particularly in key markets such as China and the United States. Global oversupply and the rise of lab-grown diamonds have also contributed to price volatility, creating challenges for producers like Petra Diamonds.
As Petra moves forward under new leadership, stakeholders - including investors, employees, and local communities - will be closely monitoring whether its cost-cutting measures and strategic realignments will be sufficient to restore financial stability.
* This article includes information from a Reuters report.