Petra Diamonds Limited

of our audited full year results for the 12 months ended 30 June 2024. I'm Richard Duffy, CEO of Petra Diamonds, and I'm joined again by Jacques Breitenbach, our CFO, who will cover the key financial metrics. After taking you through our announcement, we'll open up for Q&A. This will be hosted both verbally through the raised hand icon, and we will then move on to any typed questions moderated through the chat feature. We have also today released our annual report and financial statements, as well as our sustainability report. Please note that we will be recording this webcast and it will be available on our website later today. Moderator, could you please move to slide four? I start today with a slide that you may recall from our investor day in June, when we set out the resilience built into the business and Petra's compelling value proposition. In financial year 24, in response to weaker diamond prices, we reduced our operating cost base by around $19 million and capped it by approximately $80 million for the year, including some $75 million in deferrals. From financial year 25 onwards, operating costs will be sustainably reduced by around $44 million per annum. Relative to guidance we provided, for FY25 back in July 2023. And from FY25, we have smoothed future capital to around $100 million annually for our South African operations. Together, these actions are targeting the delivery of free cash flow through both capital and market cycles. During the year, we took the opportunity to repurchase $5 million of our 2026 second year loan notes on market and at a discount face value. This continued post-period end with the repurchase of our second year notes to date now totaling $12 million at a cost of $9 million, which will save us around 1.2 million in future annual interest costs. We intend to continue opportunistic open market repurchases. Our focus for the current financial year is on delivery of these cost savings and implementation of our smooth capital profile to generate positive cash flow from the current financial year, financial year 2025. This positions us well for a successful refinancing of our 2026 second year notes. Moderator, could we move to the next slide? Slide five please. Despite current market weakness, which has characterized much of financial year 2024, we are seeing some price stabilization on the back of actions taken by producers and the midstream in reducing supply to the market. As we've highlighted previously, the medium to longer-term supply-demand fundamentals for the natural diamond industry remain supportive. Supply, as shown in the top chart, is in structural decline and expected to halve by 2045 with the depletion of primary diamond mines and the lack of exploration investment. Only 2% of Kimberlites are economically viable, with any discovery taking at least 10 years to come on stream. Demand, as shown in the bottom left chart, is expected to increase over the next decade. Historically, natural diamond demand tracks GDP, with recent delayed recovery in China reflecting this. As mentioned, our product mix, with 80% of revenue coming from 20% of our product, is well geared for a recovery. as well as growing emerging middle class. On that point, India is now the world's second largest natural diamond consumer, with its natural market expected to expand threefold by 2030. In the West, the rise in the marketing of LGDs and the impact of Russian sanctions has made consumers more aware of prominence and traceability, a key area that the natural diamond market is addressing in terms of verifying and assuring provenance and sustainability credentials as part of a natural diamonds journey to the end consumer. We will be rolling out this technology to provide assurance to our customers and will highlight the benefits we are delivering to our employees, host communities, and other key stakeholders. Move to slide six, please. Safety is our number one priority, and this is reflected in seven fatality-free years. Our focus on remedial actions and behavior-based intervention programs resulted in a reduction of seven lost time injuries to a total of 10 in financial year 2024 and a reduction in our lost time injury frequency rate from 0.24 last year to 0.16 this year. We continue our health and well-being programs to support our culture and performance of ensuring safety and health remain our number one priority. Moving to slide seven, please. In looking at our operating and financial highlights, diamonds produced increased due to the earlier than expected and successful ramp up at Williamson. Diamonds sold increased on the back of the deferred parcels from FY23 into FY24, together with the increased contribution from Williamson. As a result, despite weaker pricing year on year, revenue increased from $325 to $367 million. This increase in revenue did not translate to higher EBITDA for the year, which reduced from $113 million, a more normal level for our business, to $66 million due to the release of inventory in a weaker market. CapEx reduced from $117 million to $84 million due to the deferral of certain capital projects during FY24. Operational free cash flow improved from a negative $65 million in FY23 to a negative $17 million in FY24. Although our net debt increased year on year, we saw an $11 million improvement from the first half of the year, level of $212 million, achieving what we had targeted at the time of publishing our H1 interim results earlier this year. I will now hand over to Jacques.

Thanks, Richard, and moderator. We'll move to slide nine.

Good morning, all. We have reported revenue of $367 million for the year. The year-on-year increase is mainly due to the deferral of sales from fiscal year 2023 to this year, fiscal year 2024, supported by increased contribution from our Williamson operation, but unfortunately offset by weaker diamond pricing compared to the previous year. Adjusted EBITDA reduced to $66 million, down from $130 million, representing an adjusted EBITDA margin of some 18%, driven by reduced rough diamond prices and impacted by a $71 million swing in diamond inventory movement year on year. Net loss after tax of some $107 million compared to the loss of $102 million in the prior year. And this number is stated after impairments totaling $78 million $45 million contributed to or attributed to French mine and $33 million to the Cullinan mine as a result of the revised live mine plans and lower pricing assumptions. Operational free cash flow improved from negative $65 million in FY23 to negative $17 million in FY24, reflecting an increase in cash from operations of some $90 million and a reduction of $29 million in our cash outflows for capital expenditure. of our capital projects at the end of the year. As at the end of June 2024, $25 million was drawn on our existing RCF and $246 million outstanding on our second-hand loan notes. And unrestricted cash balances were $28 million offset by an $8 million overdraft at our Williamson mine. Moderative even pledges like TENG At our ingress today, we provided more detailed insight into our diamond market, so today I will keep it brief. Prices achieved in fiscal year 2024 saw light-for-light prices down 12.4% compared to the prior year, with softness evident throughout the year, as also evident in the similar scale of diamond index. Our own prices were supported by product mix, resulting in fairly flat pricing over the last 18 months. As announced, we laid out a figure particularly weak market environment in August. All the market commentary suggests some signs of pricing stabilization, and as a result, we are maintaining our fiscal year 2025 final price assumptions, even at our investor day in June. Moving to slide 11. Overall, total online costs were in line with expectations, increasing some 11% compared to the prior year before 2023, largely due to the ramp-up at Williamson and cost deflation across our South African operations, partially offset by an 18% reduction in centralized costs supported by the changes to our operating model to affect these cost reductions. Adjusted mining processing costs were up 47%, largely a strike to the net movement in diamond inventory valuation, with the $37 million inventory released in fiscal year million dollar profit and loss statement swing year on year. We do not expect a recurrence of this in future years and year end reporting periods given our inventory levels have largely stabilized and our sales cycles should deliver similar inventory balances going forward. Moving to slide number 12. As previously announced, we exceeded our initial estimates of cost reductions for fiscal year 2024 against the guidance released in July 23 delivering some $10 million across the SA operations and centralized structures, which was at the upper end of our expectations in November 23, and a further $9 million at Williamson for the year. We also exceeded our official estimates of between $75 and $70 million of CAPEX savings, achieving $80 million in fiscal year 2024 in deferrals and savings. Sustainable cost savings will deliver $44 million for fiscal year 2025, costing $30 million across our S operations and the central structures, and a further $14 million at Williamson. We also expect CapEx to remain below the $100 million for FY 2025, in line with the smooth capital profile we announced at the time of our investor name. Moderator, if we can move to slide 13. Slide sets out the Cullinan mine Pinch contributions, which positively contributed to adjusted profits from mining activities, while Williamson posted a loss for FY2024 due to the ramp-up to fork production during the year. And now moving to slide 14. Looking at our balance sheet, diamond inventories reduced significantly from June 2023, with this level of inventory expected to be largely maintained. Consolidated net debt decreased from $212 million at the end of December 23 to $201 million at June 24, compared to $177 million that buy-in, largely due to the actions taken to reduce operating costs and deferrals of capex. As previously announced, and as a prudent measure, the group increased its commitments under the R1 billion, R54 million revolving credit facility with the APSA Bank, to 1.75 billion rand, which sums to $96 million, providing an additional $41 million of liquidity interim. As opposed to closed event in August and September, the group drew down some 855 million rand of our revolving credit facility as a result of deferral of our first SA tender to now close in October 2024. Moving to slide 15, Here I would like to highlight the key components of our debt, which comprises our first year in development credit facility with APSA Bank, $25 million drawn as of the end of June, and $246 million outstanding on our second year notes. During the year, as mentioned earlier as well, the group repurchased some $5 million of these notes, open market repurchase program, for a cash consideration of some $4 million, With a further $7 million, we purchased the post-beard end for a cash consideration of $5 million. These have been cancelled and will save around $1.2 million annually in interest payments going forward. Unrestricted cash of $28 million was offset by an $8 million overdraft at Williamson operation. Let's also mention that in business today, we are now focused on refinancing the loan loans and on charting the path to generating sustainable cash flow from FY25 onwards. Moving to slide 16, FY 2024, so an average exchange rate some 5% weaker than our fiscal year 2023 exchange rate. Post-fiscal year 2024, we are seeing improved self-strength due to improved global economic sentiment, stable power supplies in South Africa, and positive sentiment following the national elections in SA earlier this year. With that, I will now hand over to Richard to take his operational results.