Sarine's Profits Plunge, hit by Weak US Demand
August 21, 23
(IDEX Online) - Sarine reported a 24 per cent drop in revenue for the first half of this year and an 85 per cent plunge in profit as inflation and interest rates continued to take their toll on the US market.
Weak consumer demand had led to a build-up of polished inventory, it said, and a marked drop in the flow of rough into the pipeline.
The Israel-based diamond tech company also said the expected bounce back in China had not fully materialized.
Sales of its hardware and software to manufacturers in India, its biggest market, were down 18 per cent, it said.
"The decrease in revenues, across most geographies, was due to an approximate 40% decline in capital equipment sales and an approximate 9% decrease in recurring revenues," the company said.
It also acknowledged there had been "teething" issues, now resolved, with its new Meteorite Plus technology, to automate the high-speed processing of small rough diamonds.
Revenue for the six months to 30 June was $23.7m, the company said in its half year financial statement, and profit was down from $6.54m to $953,000.
Sarine also noted there had been minimal effects from Ukraine-related sanctions on Russia.
It said it could not be sure what impact the highly controversial judicial reform in Israel might have in its business.