[miningmx.com] – THE two-month slide in the shares of Trans Hex was arrested today after the diamond producer attributed a one-fifth increase in sales to “positive momentum” in the rough diamond market.
The R339m company was just over 12% higher on the Johannesburg Stock Exchange by midday after announcing positive figures following sales in the first three tenders of its 2014/15 financial year.
Trans Hex said total sales amounted to R350m and an average exchange rate of R10.61 against the dollar. The average rand/dollar exchange rate in Trans Hex’s previous financial year, in which full-year sales were R696m, was 10.20.
Shares in the company have been under pressure since the beginning of 2014 when they were trading at about R4,20/share. The stock was last quoted at R3,50/share, off R3,20/share which represented a 12-month low.
“These sales reflect continued positive momentum in the rough diamond market and strong demand for Trans Hex’s production,” the company said in its interim trading statement which represents the first five months of the year.
The sales included some 1,734 high-quality carats from the mining right held by Pioneer Minerals and “… one exceptional pink stone of 3,2 carats from Baken Mine which sold for $54,750 per carat. A 132-carat stone, also from Baken Mine, realised $1,28m.
Trans Hex is in the process of selling Pioneer Minerals, a transaction valued at R35m that will, once completed, signal the end of its seven-year withdrawal from the Middle Orange River region in South Africa’s Northern Cape province.
However, Trans Hex retains the right to market diamonds from Pioneer which holds a diamond mining right on the Remhoogte property.
Production at the group’s South African operations totalled 23,872 carats for the five months ended August 31. Production at Somiluana for the same period amounted to 32 841 carats, it said.
Commenting on the impact of the recovery of a 232 carat white diamond at Petra Diamond’s Cullinan mine, announced today, UK broker SP Angel, said that the diamond market was in good. “The diamond market … remains buoyant against lack lustre performance in the main commodity space,” it said.
Trans Hex said it expected to release its interim financial results for the six months ended September 30 on or about November 3.
