Final Results

Petra Diamonds Ld
09 December 2004


9 December 2004


                             Petra Diamonds Limited

                     PRELIMINARY ANNOUNCEMENT FOR THE YEAR
                               ENDED 30 JUNE 2004

Highlights of 2004

  • Joint Venture Agreement implemented with BHP Billiton on the Alto Cuilo
    project in Angola

  • Exploration operations continued at Alto Cuilo - twelve kimberlites now
    identified and a kimberlitic deposit of 115 million tonnes identified by the
    Company

  • Diamond recovery plant commissioned at Alto Cuilo and numerous gem quality
    diamonds recovered

  • Institutional placing in March 2004 raising £8m, mainly for the continued 
    development of Alto Cuilo


Adonis Pouroulis, Chairman, said;

'Petra Diamonds has this year grown to be, in terms of market capitalisation,
the largest pure diamond player quoted on AIM. The fundamentals of the diamond
industry are robust, with demand predicted to outstrip supply in the short term
and rough prices rising accordingly. We believe that Petra Diamonds is well
positioned to derive maximum benefit from the booming diamond industry. The
Company is now poised for growth and I believe that we are in a position to
extract maximum value out of our asset base for our shareholders. At the same
time, the Company is also well placed to strengthen its existing portfolio by
acquiring income producing assets.'


Summary of Results

                                   2004                      2003

Loss for the year           £ 4,219,863                 £ 875,370
Loss per share               7.45 pence                1.81 pence




For further information, please contact:

Kevin Dabinett / David Abery                      Justine Howarth / Cathy Malins
Petra Diamonds                                          Parkgreen Communications
Tel: [phone]                                       Tel: [phone]



Chairman's Statement

In my June 2003 Chairman's Statement I stated that management's focus would be
to progress exploration on Alto Cuilo in Angola, to realise the potential of our
South African exploration assets, and continue to focus on the acquisition of
carefully selected diamond projects. I am glad to announce that your company is
successfully following and delivering on the above said objectives.

The year has been a watershed one for Petra Diamonds in which the Company has
grown significantly. The objective of becoming a main player in the diamond
industry was brought a step closer with the pace of developments on the Alto
Cuilo project in north eastern Angola. Exploration work was carried out on the
Pakwe and Syferfontein kimberlites in South Africa and the Company moved forward
in resolving the sums outstanding from the Group's involvement in the management
of the Alexkor diamond mine. The Board continues to make progress in looking for
quality producing diamond assets which can be brought into the Group and we look
forward to achieving the goal of enriching the Company with the appropriate
assets.

One of the highlights of the year was the signing of a Joint Venture agreement
with BHP Billiton on Alto Cuilo, which may see the largest resource company in
the world spending up to US$60 million on Alto Cuilo to earn 75% of Petra's
economic interest in the project. This agreement with BHP Billiton is a
vindication for the Company as we have kept our commitment to developing this
concession because of our unwavering belief in the geological merits of Alto
Cuilo. As the Alto Cuilo project is still in its exploration phase, it carries
with it the normal risks associated with this type of business, however, the
work done thus far has been very promising and we as management look forward to
the flow of exploration data from the various initiatives taking place on the
ground.

Results

The loss for the year was £4,219,863 (2003: loss £875,370) equating to a loss
per share of 7.45 pence (2003: loss 1.81 pence). The Group operating loss stated
before net financing costs was £3,974,036 (2003: loss £1,755,114), the increased
loss being due to exploration progress on Alto Cuilo. Net financing costs for
the Group were £245,827 (2003: revenue £879,744).

Strategy

The strategy for the coming year, in co-operation with our Angolan partners and
BHP Billiton, will be to advance exploration on Alto Cuilo to a stage where a
geological resource has been delineated giving some indication on the economic
viability of one or more of the contained geological diamond deposits. In the
interim, there is the capacity to mine smaller diamond deposits on the
concession due to the successful commissioning on site at Alto Cuilo of the DMS
diamond recovery plant and the acquisition of an earth moving fleet. Clearly
these smaller deposits will need to be proven economically viable before any
commercial mining will take place. Should viable economic conditions prevail on
any of these smaller deposits Petra, along with its Angolan partners, will most
certainly exploit them.

The Company will continue in its efforts to balance its portfolio of diamond
exploration assets with diamond producing assets, thereby reducing risk but also
laying the platform for future growth in the diamond field, with focus on the
African continent.

Alto Cuilo

Alto Cuilo has been the highlight of the year with the Company signing a Joint
Venture agreement with BHP Billiton in November 2004. The early success in
identifying kimberlitic and alluvial deposits on the concession resulted in
Petra raising £8 million in March from institutional shareholders to further
exploration work.

The Board believes that the involvement of BHP Billiton will add significant
value to the Company, bringing leading edge technology and experience to the
project and ensuring that, should a large economically viable diamond orebody be
discovered, it will be developed optimally. Endiama and Moyoweno, Petra's
Angolan partners in the project, have added significant value to the project and
we look forward to working with them to develop the project further.

South African Exploration

Exploration work on the Syferfontein and Pakwe kimberlites in South Africa
continued and results from both bulk samples proved that both kimberlites were
diamondiferous. The sampling work on Pakwe has been completed but unfortunately
the kimberlite was not of a high enough grade to sustain an economically viable
mine; the work area will be rehabilitated and a closure certificate sought. Bulk
sampling has been completed on the Syferfontein pipe and processing of the
material is currently underway. The deposit is diamondiferous and we will know
early in 2005 whether or not there is an economic deposit.

Exploration work on the properties optioned out to Rio Tinto continued to
deliver interesting indicator mineral chemistry results during the year, but has
not yet resulted in the discovery of kimberlites.  Rio Tinto have advised us
that they will not continue their exploration work as the properties have not
yielded a deposit and Petra will look at other options with regards to these
interesting properties.

Nabera

The intended restructuring of Alexkor Limited, the State-owned diamond mine in
South Africa, has been put on hold indefinitely while the South African
Government and the local Richtersveld community attempt to resolve the much
publicised land claim dispute. The Company, through the Nabera consortium, will
continue in its efforts to find a resolution with Alexkor and the South African
Government over the disputed value-add payment and management fee.

Should the opportunity arise, Petra would still consider becoming involved in
Alexkor should the South African Government so wish. We believe that after two
years of involvement in the management of Alexkor, we gained considerable
knowledge of the asset and we welcome any opportunity to share this with the
other role players involved in Alexkor.

BEE Mining Charter

The new South African Mining Charter and Mineral and Petroleum Resources Act
came into effect on 1 May 2004. The Board welcome this development in the South
African mining industry and we believe the new legislation makes good business
sense and smaller companies like Petra can only benefit from the Mining Charter
in the long term. Petra, prior to the Mining Charter being implemented, had a
long, innovative and successful history in the mining empowerment field in South
Africa. The creation and successful operations at Nabera are a testament to
this. We hope that we can build on this in the future and become part of an even
more vibrant and dynamic Southern African mining industry.

Funding

In March 2004 a placing was completed, raising £8 million from institutional
shareholders in the United Kingdom and Europe. This money was required to fund
the development of Alto Cuilo and the success of the placing is testament to our
investors belief in the potential of Angola and Alto Cuilo.

Corporate Governance

In line with best practice and good corporate governance, the roles of Chairman
and Chief Executive Officer were split this year.  Kevin Dabinett, an
experienced mining executive, was appointed as Petra's new Chief Executive
Officer in June 2004 and the Board welcome him to this position.

Staff and Social Development

Once again it is appropriate to thank all employees of Petra, who have put in
the extraordinary effort this year that has lead to the positive transformation
of your company. The Petra family has grown significantly with the addition of
many highly skilled and competent people. I am proud to be associated with each
and every member of this Company. Consideration is always given to the
communities in which Petra operates and we are pleased to announce that a small
infirmary has been built in the main camp at Alto Cuilo where several hundred
consultations are given each month, not only to the employees of the company,
but also to their families and the residents in the small villages surrounding
the camp. We hope to continue to increase the quality of life for the
communities in and around Alto Cuilo.

Conclusion

Petra Diamonds has this year grown to be, in terms of market capitalisation, the
largest pure diamond player quoted on AIM. The fundamentals of the diamond
industry are robust, with demand predicted to outstrip supply in the short term
and rough prices rising accordingly. We believe that Petra Diamonds is well
positioned to derive maximum benefit from the booming diamond industry. The
Company is now poised for growth and I believe that we are in a position to
extract maximum value out of our asset base for our shareholders. At the same
time, the Company is also well placed to strengthen its existing portfolio by
acquiring income producing assets.

I believe that the coming year will be as exciting and energetic as this
preceding one has been and that all stakeholders will benefit accordingly.



ADONIS POUROULIS
CHAIRMAN
8 DECEMBER 2004





Petra Diamonds Limited
Consolidated Income Statement
for the year ended 30 June 2004
                                                                                2004             2003
                                                                                   £                £
Other operating income                                                         4,424            2,739
Other operating charges                                                  (3,978,460)      (1,757,853)
Group operating loss                                                     (3,974,036)      (1,755,114)
Net financing (costs)/income                                               (245,827)          879,744
Loss before and after taxation for the financial year                    (4,219,863)        (875,370)
Basic and diluted loss per share - pence                                      (7.45)           (1.81)

The Group's income and expenses all relate to continuing operations in the
current and previous year.





Petra Diamonds Limited
Consolidated Statement of Total Recognised Gains and Losses
for the year ended 30 June 2004

                                                                                2004             2003
                                                                                   £                £
Loss for the financial year                                              (4,219,863)        (875,370)
Exchange adjustments on translation of subsidiary and                        153,094        (541,295)
branch undertakings recognised directly in equity
Total recognised gains and losses relating to the financial              (4,066,769)      (1,416,665)
year





Petra Diamonds Limited
Consolidated Balance Sheet
as at 30 June 2004
                                                                               2004             2003
                                                                                  £                £
ASSETS
Property, plant and equipment                                             1,782,408          130,319
Intangible assets                                                            79,576           77,341
Investment in associates                                                          -                -
Total non-current assets                                                  1,861,984          207,660
Other receivables                                                           550,838          166,983
Cash at bank and in hand                                                  3,766,852          263,949
Total current assets                                                      4,317,690          430,932
Total assets                                                              6,179,674          638,592

EQUITY AND LIABILITIES
Equity
Issued capital                                                            6,784,998        5,163,849
Share premium account                                                    18,834,587       12,878,603
Foreign currency translation reserve                                      1,639,078        1,485,984
Accumulated loss                                                       (23,578,125)     (19,358,262)
Total equity                                                              3,680,538          170,174
Minority interests                                                                -                -
Liabilities
Trade and other payables                                                  2,013,620           90,210
Total non-current liabilities                                             2,013,620           90,210
Trade and other payables                                                    485,516          378,208
Total current liabilities                                                   485,516          378,208
Total liabilities                                                        2 ,499,136          468,418
Total equity, minority interests and liabilities                          6,179,674          638,592





Petra Diamonds Limited
Consolidated Cash Flow Statement
for the year ended 30 June 2004
                                                                               2004             2003
                                                                                  £                £
Loss before and after taxation for the financial year                   (4,219,863)        (875,370)
Depreciation of tangible fixed assets                                        52,185            9,775
Amortisation of intangible assets                                             4,250            5,290
Loss on sale of fixed assets                                                      -            1,396
Provision for write down of investment in associates                              -           27,542
Foreign exchange loss/(gain)                                                218,432        (560,313)
Interest received                                                          (16,099)            (785)
Interest paid                                                               113,700           11,870
Operating loss before working capital changes                           (3,847,395)      (1,380,595)
(Increase)/decrease in other receivables                                  (383,855)          306,263
Increase in trade and other payables                                        107,308          274,844
Cash utilised in operations                                             (4,123,942)        (799,488)
Interest paid                                                             (113,700)         (11,870)
Net cash utilised by operating activities                               (4,237,642)        (811,358)
Cash flows from investing activities
Purchase of property, plant and equipment                               (1,776,097)        (128,694)
Purchase of intangible assets                                                     -         (10,122)
Proceeds from sale of property, plant and equipment                               -            2,164
Interest received                                                            16,099              785
Net cash utilised by investing activities                               (1,759,998)        (135,867)
Cash flows from financing activities
Increase in long term liabilities                                         1,923,410                -
Net proceeds from the issue of share capital                              7,577,133        1,071,559
Net cash generated from financing activities                              9,500,543        1,071,559
Net increase in cash and cash equivalents                                 3,502,903          124,334
Cash and cash equivalents at beginning of the year                          263,949          139,615
Cash and cash equivalents at end of the year                              3,766,852          263,949






Petra Diamonds Limited
Notes to the Financial Statements
for the year ended 30 June 2004
                                                                                          2004         2003
                                                                                             £            £
1.  OTHER OPERATING CHARGES
    Auditors' remuneration
    - audit services                                                                    60,534       46,510
    - other services                                                                         -        3,138
    Amortisation of mineral rights                                                       4,250        5,290
    Depreciation of tangible assets                                                     52,185        9,775
    Operating lease rentals                                                            216,548       59,727
    Staff costs                                                                        537,839      505,995
    Bid expenditure                                                                     33,394      282,030
    Provision for potentially irrecoverable loan to associate                                _       27,542
    Share issue costs                                                                        _        2,500
    Other charges                                                                    3,073,710      815,346
                                                                                     3,978,460    1,757,853

2.  NET FINANCING (COSTS)/INCOME
    On bank loans and overdrafts                                                          (74)        (315)
    Other debt finance costs                                                         (113,626)     (11,555)
    Interest paid                                                                    (113,700)     (11,870)
    Foreign exchange (losses)/gains                                                  (148,226)      890,829
    Interest received                                                                   16,099          785
                                                                                     (245,827)      879,744


                                                                                          2004         2003
                                                                                             £            £
3.  LOSS PER SHARE

    The calculation of loss per share is based on the loss for
    the financial year of £4,219,863 (2003: £875,370) and on a
    weighted average of 56,682,704 (2003: 48,405,126) ordinary
    shares of 10p each in issue during the year.
    Loss for the financial year                                                      4,219,863      875,370
                                                                                        Shares       Shares
    Basic weighted average number of ordinary shares in issue                       56,682,704   48,405,126
                                                                                         Pence        Pence
    Basic loss per share - pence                                                        (7.45)       (1.81)
    Due to the Group's loss for the year the diluted loss per
    share is the same as the basic loss per share



4.  DIVIDENDS

    The Directors do not recommend the payment of a dividend for the year.


5.  ANNUAL REPORT AND ACCOUNTS

    The financial information set out above does not constitute the Company's
    statutory accounts for the years ended 30 June 2004 or 30 June 2003 but is
    derived from those accounts. The auditors have reported on those accounts 
    and their reports were unqualified. Copies of the full accounts will be 
    posted to all shareholders in December 2004. Further copies will be 
    available from the Company's headquarters at Elizabeth House, 9 Castle 
    Street, St. Helier, Jersey , JE4 2QP (telephone [phone]) from the 
    date of posting.


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