PJSC ALROSA released its financial results for the quarter ended September 30, 2017 (Q3) and for the first nine months of the year (9M), reporting a dip in both profits and revenue on account of external factors that lie beyond the Company’s control.
Production dropped during Q3 by 2% to 10.2 mn cts, but was up 6% over the nine month period to 29.5 mn cts. Similarly, sales volumes of gem quality diamonds were down 39% in Q3, but up by 8% to 23.9 mn cts over the nine month period. Production expenses were cut by 3% over 9M.
While Q3 revenue stood at RUB 59.9 billion (Q3 2016: RUB 70.7 bn), the 9M revenue amounted to RUB 214.5 bn (9M 2016: RUB 255.6 bn), the Company said.
Similarly, Q3 EBITDA of RUB 27.2 bn (Q3 2016: RUB 37.7 bn) and net profit of RUB 13 bn (Q3 2016: RUB 25.7 bn) were both down, while the decline was less steep over the 9M period with EBITDA at RUB 100 bn (9M 2016: RUB 150 bn) and net profit at RUB 61.9 bn (9M 2016: RUB 117 bn).
The drop was attributed to by a 15% ruble appreciation against the US dollar and a 12% decrease in the average price of diamonds sold during the period mainly as a result of changes in the diamond mix.
The Company’s net income was adversely affected by an impairment of RUB 7.4 bn in fixed assets lost in accident at the Mir underground mine.
“ALROSA’s 9M 2017 results remained subdued by macroeconomic and market factors beyond the Company’s control. At the moment, we are witnessing a moderate resurgence in the diamond market. Implementing our efficiency improvement initiatives has helped to cut unit production costs,” said Sergey Ivanov, Chief Executive Officer of PJSC ALROSA
News Source: gjepc.org