Revenues shine at Gem Diamonds

The AIM-listed diamond miner sold 24,790 carats in the three months to 31 December 2021, compared to 29,783 in the previous quarter, with an average price of $2,018 per carat. In the third quarter, it achieved an average price of $1,589 per carat.

The highest price achieved was $40,130 per carat, for a 101.16 carat white diamond, while five diamonds sold for more than $1m each.

Revenues were $50.0m, down on the same three months in 2020, when they touched $54.6m, but an improvement on the third quarter’s $47.3m.

Gem said all its operational and financial metrics for the 2021 full year were either within or better than guidance. It sold 109,697 carats during the year, an 11% increase on the previous 12 months, while the total value rose 6% to $201.3m. The average carat price for the year was $1,835, a 4% decline.

Chief executive Clifford Elphick said: "During the quarter, prices achieved for the Letseng goods were strong, reflecting the continued good demand for Letseng production, especially for the larger higher quality diamonds."

Gem Diamonds owns 70% of the Letseng mine in Lesotho and is in the process of selling its Ghaghoo mine in Botswana.

Okwa Diamonds Proprietary, which is owned by Vast Resources and Botswana Diamonds, had initially agreed to buy the mine, but Gem said Vast has since pulled out the deal.

Botswana Diamonds, however, still intends to complete the transaction as originally envisaged, Gem said, and has already identified an alternative financing partner.

As at 0930 GMT, shares in Gem were ahead 1% at 48.4p.