Trans Hex has issued a warning about its capacity to continue as a going concern, stating there was “material uncertainty” around its ability to fund its short-term liquidity requirements. The notification comes amid continued operating losses for the business.
Trans Hex recorded a loss of ZAR 9.3 million ($654,592) for its South African operations during the 2019 fiscal year ending March 31, the miner reported last week. In fiscal 2018, the company saw a deficit of ZAR 70.8 million ($5 million).
However, the 2019 performance was boosted by the disposal of Trans Hex’s Lower Orange River (LOR) operation — which included the Baken and Bloeddrif mines — in April last year. Including proceeds from the sale, the project earned a profit of ZAR 77.8 million ($5.5 million) in 2019.
Meanwhile, group revenue fell 24% to ZAR 312.6 million ($22.6 million) for the year, even as the volume of sales rose 60% to 151,424 carats.
The company cautioned that the rough-diamond market continued to be weak and was expected to “remain softer” through the third quarter of the calendar year.
Image: Rough diamonds. (Ptukhina Natasha)