Petra Diamonds Limited Shines On “Magnificent” Discovery

Petra Diamonds Limited (LON: PDL) recovers a 232 carat white diamond at Cullinan mine.

Mark Stones

Mark Stones (TMFMumbojumbones) joined The Motley Fool in 2014 and initially worked as a writer for Fool.co.uk, before joining the Fool’s analyst programme. Mark earned a BA in English from Loughborough University. Although he spends more time reading annual reports than Russian literature these days, he still appreciates a novelist’s antipathy toward the accepted view, which is a useful attitude when trying to sniff out hidden gems on the stock market. His approach to investing has been largely influenced by the principles of Warren Buffett and Peter Lynch. He also takes a special interest in the work of healthcare companies. Outside of investing, Mark plays guitar, enjoys good writing and has a guilty passion for combat sports.

Published 9 September, 2014 10:57 am BST

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Petra Diamonds (LSE: PDL) shares increased by 6% in early trade, after the FTSE 250-listed diamond miner announced the recovery of a 232-carat white diamond at the Cullinan mine in South Africa.

Petra said the stone is “a magnificent example of the large, high quality diamonds for which the mine is known”.

The Cullinan mine is one of the world’s most historically significant diamond sources. It is especially renowned as a source of large diamonds — most notably the 3,106-carat Cullinan stone discovered in 1905, which was cut into two diamonds and now form part of the crown jewels in the Tower of London.

Petra’s latest find — a D colour type II diamond — is expected to be sold in the second quarter of this financial year.

Earlier this year a 29.6 carat blue diamond was sold for $25.6m. In the year to 30 June 2014 Petra’s revenue increased 17% to $472.6m.

Petra has said it remains on track to reach annual production of circa 5m carats by the end of 2019. Based on production growth, diamond prices and expansion plans, the board may declare a maiden dividend from full year 2016.