Sarine Technologies records net profit of $2.4 mn in FY2020


Sarine TechnologiesLtd has announced its financial results FY2020 for the year ended 31 December 2020, mentioning that the Covid-19 virus affected the Group’s operations for most of FY2020. But, despite the challenging year affected by the COVID-19 pandemic, the Group’s active cost management as well as product mix has contributed to positive results, says a press release from the company.
With reduction in demand for diamond/diamond jewellery in consuming markets, as well as production halted in India and other manufacturing centres in the world, the Group recorded revenue of $41.0 mn in FY2020, a decline of 20% from the $ 51.3 mn achieved in FY2019.
The revenue of $22.4 mn in H1 2020 reflected a strong Q1 2020 with robust capital equipment sales and Galaxy® scanning service income, followed by a sharp drop in revenue in Q2 2020 with the onset of the pandemic. Revenue of $18.6 mn in H2 2020 comprised a weak Q3 2020 and a strong rebound in Galaxy® scanning service income in Q4 2020.

As the Group’s operating expenses reduced by 22% in FY2020 as compared to FY2019, coupled with the product mix, the loss of $1.4 mn in FY2019 was reversed to a net profit of $2.4 mn in FY2020. Net profit in H1 2020 and H2 2020 was similar at $1.2 mn, with H1 2020 benefiting from a strong Q1 2020 and H2 2020 from cost reductions and the strong rebound in Galaxy® scanning service income in Q4 2020.

Sarine’s future prospects seem bright as the global diamond industry started on a path of recovery in H2 2020, aided by the reopening of jewellery retail activities, leading up to and including the end-of-year holiday season, and the consequent resumption of diamond manufacturing activities in India.

Initial data and reports indicate that China, the second-largest market for polished diamonds accounting for almost a fifth of global demand experienced growth in luxury spending in 2020 as well as during the Chinese New Year season in 2021. In the United States, initial reports indicate that overall diamond jewellery spending during the critical year-end holiday season was stronger than expected, likely at the expense of travel and entertainment.