In a recent announcement, Gem Diamonds revealed a 26% decline in sales from its Letšeng mine in Lesotho, totaling $139.4 million for the year. The sales volume experienced a modest 3% dip, amounting to 104,520 carats, accompanied by a notable 24% decrease in the average price per carat, which now stands at $1,334.
Throughout the year, Gem Diamonds successfully unearthed five rough stones exceeding 100 carats, compared to four in the previous year. Additionally, the company recovered 196 diamonds over 20 carats in 2023, a slight decrease from the 199 diamonds retrieved in 2022.
Despite the drop in sales from the previous year, the overall production for the full year witnessed a 3% growth, reaching 109,656 carats. The company attributed this increase to initiatives aimed at enhancing plant performance and boosting ore-processing rates at the Letšeng mine. Furthermore, Gem Diamonds acknowledged the positive impact of this growth, especially when compared to the challenges faced in the previous year due to planned power outages by electricity provider Eskom.
While the sales figures for 2022 saw a decline, they remained consistent with Gem Diamonds’ revised annual guidance issued midway through the year. The company had initially projected a sales volume ranging between 102,000 and 105,000 carats.
For the fourth quarter of the year, Gem Diamonds reported a 12% year-on-year growth in revenue, totaling $36.4 million. Sales volume experienced a significant 26% surge, reaching 28,402 carats, compensating for an 11% reduction in the average price per carat, now standing at $1,281. The production for this period exhibited a notable 21% increase, totaling 32,142 carats.
Despite the challenges posed by declining average prices, Gem Diamonds remains optimistic about its ongoing initiatives to optimize operational efficiency and navigate market fluctuations. The company’s ability to surpass its revised annual guidance indicates a resilient performance in a dynamic market environment.
