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Debmarine increases profits and production

Debmarine increases profits and production

Debmarine increases profits and production
Profit: Debmarine CEO, Otto Shikongo. _Photo: Contributed

Business Reporter

NAMIBIA’S premier Offshore Diamond mining company, Debmarine Namibia, has delivered stellar results for the year 2018, albeit the recession, with its revenue increasing by 11% to N$8.9 billion.

The increase was driven by increased production, improved consumer demand, prices and the weakening of the Namibia dollar against the US dollar.

Speaking at a media engagement last week, Debmarine CEO, Otto Shikongo, stated that Debmarine Namibia’s 2018 production of 1.44 million carats constitutes 72 % of the total Namdeb Holdings production of 2 million carats.

The 4% increase from 1.38 million in 2017 was driven by fewer import maintenance days for the Mafuta crawler vessel and the use of a technology-led approach for optimising the performance of the drill fleet.

In addition, the company stated that EBITDA (Earnings before interest, tax, depreciation and amortisation) increased by 6% to N$4.6bn. The EBITDA increase is slightly lower due to cost pressures led by fuel prices and increased maintenance, but still maintaining a healthy 52% EBITDA margin.

“We are entering a period of significant capital investment, which is evidenced by the increase in capital expenditure and lower dividend payments,” Shikongo stated.

Effective 1 Oct 2011, Debmarine Namibia became a 50/50 joint venture between the Government of the Republic of Namibia and De Beers Group.

The CFO of the company further noted that the company’s safety record took a knock in 2018 when it recorded the highest number of lost time injuries. The company’s Atlantic 1 mining license is valid until 2035 and is located in the South West of Namibia, covering approximately 6 000km².

The company further outlined that considering the size of the ecosystem, mining impacts a very small area (1.2%) of the ecosystem and is deemed to be of low significance at a regional scale.

Apart from DBM South Africa, the company ‘Namibianised’ its top 5 strategic contracts – Helicopter operations, Fixed wing operations, Fuel supply, Lüderitz support, Catering & Tug support. The Lüderitz Logistics and supply base was established in 2015 in order to service the fleet of vessels and support local business. A total N$137m was invested in Lüderitz during 2018 through procurement of goods & services.

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