Sarine’ revenues drop 46% in H1 2015

Sarine Technologies Limited announced its financial performance for the first half of 2015 and the second quarter of the current year. Within each of these periods, the company recorded a drop in its revenues as compared to the corresponding periods of 2014.

In the first half of the year which closed on June 30, 2015, the company recorded revenues worth US$26.6 million, which was 46 percent lower on y-o-y basis (US$49.1 million in H1 2014). The revenues for the second quarter stood at US$ 14.4 million, which was lower by 42 percent from revenues worth US$ 24.7 million earned in Q2 of 2014. The company attributed the negative conditions in the midstream to have affected its revenues and profits. The disproportionate high rough diamond prices, lower polished diamond prices, a pileup of polished stock in the midstream and thereby lower than anticipated Galaxy TM processing revenues. Profits stood at US$2.7 million falling 69 percent in the second quarter, while it dipped almost 80 percent in the six months to US$3.6 million. Recurring sales dropped 20 percent.

The company recorded a drop in revenues across its locations in the world, mainly due to a decline in sales of diamond manufacturing equipment sales its geographies, especially India. The sales in the said six months this year - in India dropped 51 percent, while in Israel it slipped 41 percent and in Africa by 45 percent. In North America there was a 43 percent increase, while in Europe it was a 45 percent increase. Sales in North America in the second quarter this year rose 94 percent while in Europe it was up by a whooping 128 percent.

The company noted that the overall industry conditions are improving and overall consumer demand is likely to be similar to 2014. Russia, Japan and the Middle East markets continue to remain slow, but the US is showing ‘healthy demand with minimal growth’. The looming concern of the Chinese economy has caused a reduced outlook of demand for polished diamonds.

Although the Group has seen a good performance in its Q2 period as compared to Q1 of 2015, despite challenging market conditions. Its revenues increased 18 percent to US$14.4 million in the three months over Q1 in 2015. Net profits stood at 2.7 million, rising 200 percent over US$0.9 million in Q1 2015.