Large Stone Recoveries Give Gem Diamonds a Big Boost in H1 Results

(IDEX Online) – Gem Diamonds Limited reported that record recoveries of large, high quality diamonds at its Letšeng mine in Lesotho, combined with the discovery and subsequent sale of the Lesotho Legend, have generated a strong financial performance for the first half of 2018.

Revenue for the half year was US$167.7 million, up 81% from US$92.9 million in H1 2017.

The 910-carat Lesotho Legend was sold for US$40.0 million, and the miner said it recovered a half year record of 10 diamonds greater than 100 carats with record rough tender revenue of US$169.2 million (US$88.8 million in H1 2017).

The average price per carat was US$2 742 (up 54% from US$1,779 per carat in H1 2017), with 25 diamonds achieving a sales value of greater than US$1 million each. The firm reported 61,596 carats recovered (50,478 carats in H1 2017).

Clifford Elphick, Chief Executive of Gem Diamonds, said: "Letšeng’s improved recoveries combined with the discovery and subsequent sale of the Lesotho Legend has generated a strong set of results. Letšeng produced a record number of diamonds greater than 100 carats for any six-month period in the mine’s history reaffirming the exceptional and unique quality of Letšeng. Subsequent to June, two further diamonds larger than 100 carats have been recovered, with the latest in August marking the twelfth such recovery for the year. This now positions 2018 as a record for recoveries of diamonds greater than 100 carats in a single year.

"The market for Letšeng’s high-quality diamonds has remained robust, with an average price achieved of US$2,742 per carat during the Period, up 54% compared to H1 2017 of US$1,779. It is also pleasing to report on the progress of the Business Transformation. This has already seen initiatives achieved in revenue, productivity improvements and cost savings to the value of US$47 million of the 2021 US$100 million target."