Lazare Kaplan Posts $3.7 Million Q3 Loss

Lazare Kaplan International Inc. posted a sharp 45.64 percent decline in second fiscal quarter net sales, dropping to $41.3 million, the company announced Tuesday. About half of the sales, $20.2 million, were revenues generated from polished diamond sales.

The remaining $21.1 million in revenues came from rough diamond sales, the Diamond Trading Company (DTC) Sightholder said.

Net loss for the three month period ended November 30 was $3.7 million.

The decrease reflects lower sales of both branded diamonds and fine cut commercial diamonds, the company said. Polished diamond sales have been significantly impacted by the worsening global economic conditions, and the reluctance of customers to purchase inventory in response to liquidity concerns.

“Uncertainties regarding future economic prospects and a decline in consumer confidence during the current fiscal quarter translated into lower purchases and sales by diamond producers, wholesalers and retailers in virtually all sectors of the diamond and jewelry industry,” Leon Tempelsman, President of Lazare Kaplan said in a release.

For the six month period, net sales were $119.6 million compared to $193.1 million in the first half of the prior year. Of this, polished diamond revenue were $61.1 million as compared to $76.9 million.

Rough diamond sales were $58.5 million for the six months falling from $116.2 million. The decrease in rough diamond sales primarily reflects reduced purchases, as the company sought to preserve liquidity and declined to purchase rough diamonds it considered overpriced in light of current market conditions.