LSE-listed Gem Diamonds’ Letšeng mine, in Lesotho, delivered satisfactory operational results in the six months ended June 30, notwithstanding a 30-day shutdown imposed in the country.
In fact, the frequency of large diamonds recovered improved in all size categories greater than 10.8 ct compared with the six months ended June 30, 2019.
The company recovered seven diamonds larger than 100 ct in the reporting period, compared with three diamonds larger than 100 ct recovered in the prior comparable period.
Overall, Gem recovered 43 275 ct in the six months under review, compared with 56 668 ct recovered in the prior corresponding six months.
The company reports that the sales results for the six months under review demonstrated continued demand for the mine’s high-quality diamonds and the company achieved an average price of $1 707/ct.
Gem says the reopening of key sectors within the diamond industry globally, particularly in the manufacturing sector, should support demand again in the short to medium term.
Gem generated underlying earnings before interest, taxes, depreciation and amortisation of $11.3-million for the six months under review, compared with $25.3-million in the prior comparable six months.
The company posted a loss from discontinued operations of $1.9-million, which related to the Ghaghoo mine, in Botswana, which was sold during 2019.
Positive cash generation in the six months under review helped to reduce the company’s net debt position by $4.7-million to $5.5-million.
The company had $17.5-million cash on hand at the end of June, of which $13.8-million is attributable to Gem.
The company also has unused facilities of $51-million.
Gem Diamonds’ business transformation programme, which was launched in February 2018, has delivered $65-million to the group’s results to date.