Rough diamond sales from Gem Diamonds’ Lesotho-based Letseng mine rose 19 percent year-on-year in Q3 to reach $48.1 million.
Shares of London-listed Gem Diamonds (LSE:GEMD) increased on Tuesday (October 31) after the company reported positive results for the third quarter.
Rough diamond sales from Gem Diamonds’ Lesotho-based Letseng mine rose by 19 percent year-on-year to reach $48.1 million in the quarter ended September 30. This strong demand boosted prices by 23 percent to an average of $1,858 per carat.
“The market for Letseng’s high-quality diamonds has remained firm over the period, with the July tender achieving nearly $2,400 per carat,” said CEO Clifford Elphick. Production from Letseng surged as well, jumping 26 percent to hit 30,744 carats.
During Q3, the company sold a 7.87-carat pink diamond for $202,222 per carat, the second-highest average price in Letseng’s history. Meanwhile, a 55.58-carat white diamond went for $61,778 per carat, the highest average price for a white diamond from the mine in 2017, the company said.
Gem Diamonds also said it has received a conditional offer for its Ghaghoo mine in Botswana, which it has been looking to sell due to a drop in prices for its more commercial-quality rough. “Due diligence and discussions with the potential buyer are ongoing,” the company commented.
The miner sold 13,021 carats of remaining rough from the asset during the third quarter for an average price of $175 per carat.
“The group-wide efficiency and cost reduction review is progressing well and has already identified annual and once off cost savings of $20 million, which is an increase of $5 million over the figure announced at the time of our interim results,” Elphick added.
On Tuesday, shares of Gem Diamonds closed up 2.56 percent in London at GBX 80. The company’s share price has lost 27.27 percent year-to-date.
Don’t forget to follow @INN_Resource for real-time news updates!
Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.