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Petra Diamonds’ new CEO to work on strategy, seeks stability first

African miner Petra Diamonds’, which has high debt levels, aims to be cash flow positive in the second half of the year and will then be able to consider future developments, its new chief executive said on Monday.

The company’s share price has fallen 55 percent since the start of the year as weak diamond prices weighed and Petra grapples with debt following years of capital expenditure to upgrade its mines.

On Monday the company reported lower output in the quarter ended on March 31, as an upgrade of operations at one of its mines fell behind schedule, but also said it sees signs that diamond prices are recovering.

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CEO Richard Duffy, who took office at the start of the month, said his short-term focus was “on stabilizing the operations as we transition from a stage of high capital investment”.

The company would be on track to consider future developments, he said, once it has delivered free cash flow and cut net debt, which was about 3.3. times EBITDA (earnings before interest, tax, depreciation and amortization) at the end of last year versus a goal of 2 times.

“I’m two weeks into the job,” Duffy said in a maiden round of media interviews, when asked about strategy. “We expect to announce strategy toward the end of the calendar year.”

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