State diamond miner Alexkor has shot the lights out with preliminary financial results indicating a profit for the year of R70 million, up 63% from 2022.
This as it posted a 116% increase in revenue to R492m.
Alexkor said it was helped by weak dollar/rand exchange and increased carat prices as well as increased production.
“The pooling and Sharing Joint Venture (PSJV) has seen significantly improved diamond sales, which contributed to the positive financial position,” interim CEO Trevor Fowler said.
Fowler said production was exceeding expectations with last year’s 34 000 carat target surpassed.
Alexkor said this year it had mined 36 700 carats, pointing out though that the price had gone down significantly in the current year for large diamonds.
Interim chairperson Dr Trish Hanekom and other executives said the entity was doing better after entering into a PSJV with the Richtersveld Mining Company, a community held initiative, has enabled better revenues through rental income, the adjustment of expenses which had not been recognised in the past and a windfall of more than R150m in the first quarter of this year.
Alexkor, with 51% in the PSJV said the operation yielded revenue of R337m with a profit of R38m in the first quarter.
Alexkor reported it had no borrowings.
Through the PSJV, Alexkor is focusing on rehabilitating historic mining areas alongside current ones and also has plans to re-mine diamond ferrous waste from old tailing dumps, which it says could still yield some results.
Hanekom said the interim board, which was appointed in February last year, found non-compliance with statutory reporting requirements in the external audit for 2020/2021.
Alexkor's audit results for 2021/2022 and those of 2022/2023 have been delayed after the entity had to request the Auditor General to do the honours because there were questionable areas of the audit conducted by an external auditor.
Alexkor has asked the Special Investigating Unit to follow up.
The entity is besieged by a persistent threat from illegal miners scouring gravel at the most lucrative spots as Alexkor escalates its production through a combination of Community Mining Units (CMU) and small contractors.
Alexkor detailed a siege on diggings at abandoned mines belonging to De Beers and West Coast Resources, which necessitated a special operation on Tuesday at which more than 1 000 illegal miners occupying illegal settlements close to gravel sites were arrested.
Fowler assured though that through a rapid response security team and collaboration with the SA Police Service, there was no encroachment on its turf.
“There is no illegal mining on the 90km of the coast and 17km of the Orange River under the concession of Alexkor and the PSJV,” he said.
Alexkor, which plans to hand over water, electricity as well service delivery infrastructure over to the Richtersveld Municipality, says there is an urgency in addressing the capacity of the Richtersveld community because the Boegoe Bay Harbour and Green Hydrogen Project by Sasol were in the final stages of planning and may have an impact on livelihoods.
“The implications for the Richtersveld community is significant economic opportunities but also has implications for housing and infrastructure availability as well as stability of the community,” Fowler said.
BUSINESS REPORT