Coronavirus company news summary – Perenti posts increase in revenue in FY 2020 – De Beers reduces price of diamonds

25 August 2020 (Last Updated August 25th, 2020 09:46)

25 August

Operations at San Cristóbal’s mine in Bolivia have been suspended for a second time due to the Covid-19 outbreak. San Cristóbal had earlier suspended operations in March and then resumed production in May, reported Reuters. San Cristóbal is a fully owned subsidiary of Japan-based Sumitomo Corp. The mine is the largest in Bolivia and features a huge deposit of zinc, lead and silver. The firm conducted medical checks on 8,093 workers and contractors and identified 168 suspected cases, out of which 41 have been confirmed positive.

Over a thousand mine workers in Indonesia stopped access to the Grasberg gold and copper mine to mark a protest against the coronavirus lockdown policy that stopped staff bus services to meet with families, reported Reuters. Grasberg is the largest gold mine and second largest copper mine in the world and is operated by Freeport-McMoRan’s local business unit. Presently, the mine is transitioning from its open pit operation to underground mining. This year, the mine is expected to have a daily production of 110,000 tonnes of copper ore.

Perenti, an Australia-based mining services group, has posted a record of $2.04bn revenue in its full-year financial report for 2020, which is an increase of 3.8% against 2019's result. The firm also reported 6.8% year-on-year increase in underlying earnings before tax interest depreciation and amortisation of $443.8m in 2020. The Perth-based firm also bolstered its liquidity position, which currently sits at $600m in cash and undrawn credit. The firm expects that the increase in liquidity will help it to ease out challenges in the wake of the Covid-19 pandemic.

The Anglo American unit, De Beers has decided to reduce the price of its diamonds as Covid-19 pandemic has weakened the industry. De Beers and its Russian competitor Alrosa had earlier attempted to defend the value of the gems as the Covid-19 paralysed the industry. With the closure of jewellery stores, cutters and polishers restricted to their homes, the diamond industry has come to a standstill. In the second quarter of 2020, De Beers and Alrosa sold a total of $130m in rough diamonds, which is a huge decline from $2.1bn recorded a year before.