S. African Diamond Miner Trans Hex' Losses Spike as Rough Prices & Sales Fall

Mining and Exploration
28/06/2017 18:11

For the year ended 31 March 2017, South Africa-based and JSE-listed junior diamond mining company Trans Hex Group reported a loss of $14.1 million (R182.6 million), representing an 81% increase than the year prior, when the group recorded a loss of $7.8 million (R100.8 million). The loss derives from sales revenue decreased by 19.5% to $41.8 million (R540.2 million) compared to the corresponding period a year earlier. Diamond sales by volume fell 17.5% to 40,187 carats, while the average price of rough sold dropped 2.2%, the company reported. Results were particulary poor at their wholly owned South African land operations, where production dropped to 36,500 carats from 48,000 in 2016 and 62,000 in 2015, with prices falling to $959 per carat from $1,353 per carat two years ago.

Results at Somiluana in Angola, in which Trans Hex holds a 33% stake, were strong as production increased 38% to 137,219 carats. Total sales from Somiluana amounted to US$69.7 million at an average price of US$500 per carat (2016: sales of US$34.2 million at an average price of US$351 per carat). 

South African production for 2018 is expected to be in the order of 37,000 carats, while operational and infrastructure improvements are continuing at West Coast Resources, in which Trans Hex has a 40% stake; the Group expects production at West Coast Resources for the 2018 financial year to be in the order of 150,000 carats. They note that results at Somiluana Mine in Angola continue to exceed expectations and production for 2018 is expected to be in the order of 120,000 carats. the Group is actively evaluating potential new diamond properties and pursuing opportunities to expand its diamond-marketing activities.