Gem Diamonds Q1 remained reasonable!
Gem Diamonds Group's operational and sales performance from 1 January 2020 to 31 March 2020 that is Q1 2020 revenue was US$47.3 million (Q4 2019: US$51.3 million). Average price achieved for the Period was US$1 615 per carat (Q4 2019: US$1 713 per carat). Carats sold during the Period were 29 298 (Q4 2019: 29 945). 11 diamonds sold for more than US$1.0 million each, generating revenue of US$20.7 million during the Period.
Covid-19:
On 25 March 2020, the Prime Minister of Lesotho announced a general lockdown between 29 March and 21 April (the lockdown period) to curb the spread of Covid-19 in Lesotho. In accordance with this order, all non-essential business and services in Lesotho are subject to the lockdown, including all mining operations.
In accordance with the Lesotho Government's three-week lockdown strategy and published regulations, and in support of its efforts to curb the spread of the Covid-19 virus, Letšeng has temporarily suspended operations and placed the mine on care and maintenance. This will be reviewed when the lockdown period has ended, and steps are in place for operations to resume as soon as it is safe for the Group's employees and contractors to do so.
Gem Diamonds' CEO, Clifford Elphick, commented: "One of Gem Diamonds' key priorities is the welfare of its employees, contractors and customers around its operations and office sites, and we continue to ensure all relevant and necessary safety protocols relating to Covid-19 are adhered to.
Gem Diamonds is proud to be playing its part in the fight against the Covid-19 disease by providing a mobile office and testing facility for use by the Department of Health in Maseru in order to carry out crucial testing and various prevention and testing initiatives in the surrounding communities.
Letšeng's mining progressed well during the Period and we are confident that the mine will be able to rapidly ramp-up to full production once the lock-down period is lifted and it is safe for all our employees and contractors to return to site.
The positive results of the flexible tender sales process demonstrated the continued demand for Letšeng's high quality diamonds with the average price of US$1 615 achieved during the Period, notwithstanding the extremely uncertain and challenging global conditions.''
Diamond Market:
Prices for Letšeng's diamonds have been negatively impacted in March 2020 due to the global Covid-19 pandemic but have demonstrated resilience in this global crisis.
Waste stripping continued in line with the requirements of the updated long-term mine plan that incorporates the steeper inter-ramp slope angles. Letšeng's Plants treated a total of 1.3 million tonnes of ore during the Period with the remaining balance of 0.2 million tonnes treated through the Alluvial Ventures contractor plant.
Mining and treatment volumes were impacted during the Period primarily by drill rig availability issues, testing of different blasting parameters, additional maintenance to the tertiary cone crusher and scrubber drive-arrangement in Plant 2 and further remedial work and maintenance to the primary crushing area (the PCA).
The remedial work and continued maintenance to the PCA has extended its life and thereby deferred planned capital associated with the required replacement of this facility. In addition, towards the end of the Period, the mining and treatment volumes have been impacted as a result of the lockdown and the placing of the mine temporarily on care and maintenance which commenced on 28 March 2020.
