Prolonged Rough-Industry Slump Deepens Gem Diamonds’ Loss

Gem Diamonds reported a loss for the full year, amid a large impairment to its assets.

The company noted a loss of $104 million in 2025 compared to a loss of $2.9 million the year before, it said Wednesday. The miner attributed the deficit primarily to an impairment of $77.5 million on the valuation of its assets as a result of the challenging rough-diamond market. In addition, the weakening of the US dollar against the Lesotho loti also played a part. Gem Diamonds earns money in US dollars, but pays its bills in the Lesotho currency.

“The continued weakness in the diamond market required decisive action to protect the financial viability of Letšeng and the rest of the group, which led to the launch of the Business Resilience Programme in the second half of 2025,” said Gem Diamonds CEO Clifford Elphick. “These measures were essential to ensure that Letšeng remains a sustainable operation capable of supporting employment, communities and stakeholders over the longer term.”

“We are confident that the measures implemented in 2025 have better equipped the group to be well-positioned for a recovery when market conditions improve,” he stressed.

Revenue plunged 36% to $98.4 million, mainly stemming from a downturn in the diamond market and the sale of fewer and lower-quality diamonds, the company explained. During the year, the miner sold nine diamonds greater than 100 carats, compared to 13 a year earlier. This and the lower-grade ore drove the revenue slide, outweighing cost savings from the Business Resilience Programme and royalty relief the Lesotho government granted in the second half of the year. The company sold 14 rough stones for more than $1 million each, contributing $20.8 million of revenue.

Sales volume dropped 20% to 88,381 carats, while the average price fell 21% to $1,105 per carat. Output slipped 14% to 90,354 carats for 2025.

The company’s net debt grew to $20.1 million at the end of 2025 from $7.3 million as at December 31, 2024.

Image: The Letšeng mine. (Gem Diamonds)