High Rough Prices Boost Gem Diamonds Revenue

RAPAPORT… Gem Diamonds reported a rise in first-quarter sales amid strong demand and the sale of high-value rough from its Letšeng mine in Lesotho.

Revenue climbed 19% to $52.1 million during the three months ending March 31, the company said last week. Sales volume grew 6% to 28,461 carats, while the average price increased 12% to $1,831 per carat.

Prices were higher on a like-for-like basis than those seen during the latter part of 2021, reflecting the favorable market conditions, the company noted.

Nine diamonds sold for more than $1 million each during the quarter, contributing $16.2 million to the total revenue. An 8.41-carat pink diamond, which sold for $66,059 per carat, garnered the highest price. Meanwhile, the best price for a white diamond was $53,834 per carat.

“We remain confident about the outlook for diamond prices, particularly for Letšeng’s large, high-value diamonds,” said Gem Diamonds CEO Clifford Elphick. “Prices achieved on a like-for-like basis continued the largely upward trend from 2021.”

Production for the period slipped 2% to 28,430 carats, as the company mined a lower proportion of ore from Letšeng’s satellite pipes than it did the year before. The main pipes, which were the predominant source of rough in the quarter, contain lower-grade ore, the miner noted.

The miner’s sale of its Ghaghoo deposit in Botswana to Okwa Diamonds, a company owned by Vast Resources and Botswana Diamonds, is ongoing, it explained. Gem Diamonds agreed to extend the deadline for the sale until May 10 from March 31 to allow the buyer time to find an alternative financing partner.

Image: The Letšeng mine. (Gem Diamonds)