Profit tumbles at Gem Diamonds 1H
Gem Diamonds Limited announces its Half Year Results for the period ending 30 June 2019. At financial front they said, revenue US$91.3 million (US$167.7 million in H1 2018) & underlying EBITDA US$25.3 million (US$70.7 million in H1 2018). Attributable profit, from continuing operations US$6.6 million (US$26.8 million in H1 2018). Ghaghoo care and maintenance costs of US$2.4 million reported as loss from discontinued operation.
Letšeng mine that sold a 13.32 carat pink diamond for US$8.8 million, achieving a record price of US$656 934 per carat & recovered 3 diamonds greater than 100 carats during the period. Implemented inter-ramp pit slope steepening, resulting in a lower LoM strip ratio. Average price of US$1697 per carat achieved during the period
US$42 million has been realised net of implementation costs and fees in the first 18-months of the 4-year Business Transformation programme. US$ 100 million in incremental revenue, productivity improvements and cost savings to end 2021 is on track. The H1 seen construction of the detecting diamonds within kimberlite, pilot plant at Letšeng was completed with commissioning and ramp-up planned for latter part of Q3 2019.
Commenting on the results today, Clifford Elphick, Chief Executive of Gem Diamonds, said: "Letšeng achieved US$ 1697 per carat for the Period with the sale of the 13.32 carat pink diamond achieving a Letšeng record of US$ 656 934 per carat, reaffirming the unique quality of Letšeng's diamond production.
The prices achieved for the Period are 10% up from the prices achieved in the preceding 6-month period, notwithstanding the planned limited contribution from the Satellite pipe ore and current diamond market conditions. The Group has successfully implemented the business transformation programme, already achieving US$42 million net of fees, and is on track to deliver the planned US$100 million in cost savings and efficiencies by 2021."
