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Johannesburg – London-listed Gem Diamonds has reported a decline in basic earnings per share to 10.36 US cents for the six months ended June 2012‚ from 21.76c a year earlier.
It reported revenue of $180.2m compared with $196.5m in the first half of 2011 and underlying earnings before interest‚ tax‚ depreciation and amortisation of $52.7m‚ down from $90.8m in the comparable period last year.
Its attributable net profit declined to $14.3m from $28.9m.
Operationally‚ the group reported a continued solid performance at the Letseng mine in Lesotho‚ producing 57 116 carats‚ up 8% from last year‚ and posting a recovered grade of 1.68 carats per 100 tonnes‚ also up 8%.
The group said good progress was made on the Letseng production expansion project‚ called Project Kholo‚ which began in January 2012.
Ore mined at Ellendale in Australia came in at 2.0 million tonnes‚ up 234%‚ with 2.1 million of ore treated‚ up 44% from the first half of 2011. Ellendale’s carat production rose 51% to 78 881 carats.
The Ghaghoo mine development project is under way‚ with US$37m of the capital budget spent to date.
The company said it remained committed to doubling production at Project Kholo and the development of Ghaghoo in Botswana.
However‚ in light of the current economic climate and to maintain the company’s strong balance sheet‚ the board has decided to extend the completion dates of Project Kholo and Ghaghoo.
It said it would keep the global economic environment under review and‚ should market conditions improve materially‚ the project execution would be accelerated.
Commenting on the results‚ Gem Diamonds CE Clifford Elphick that‚ said against a challenging price backdrop for the diamond industry‚ the first half of 2012 was marked by strong operating performances at both producing mines‚ Letseng and Ellendale.
“Letseng reported an increase in both carats recovered and recovered grade compared with H1 2011‚ with cash costs being held in line with management estimates.
"Ellendale reported a significant increase in both ore mined and treated‚ and carats produced‚ which achieved strong prices during the period despite the challenging market conditions.”
Elphick said the group’s strong balance sheet‚ with $139m of cash as at end-June 2012‚ no debt and strong operating cash flows positioned it well to weather the current downturn in the diamond market.
It reported revenue of $180.2m compared with $196.5m in the first half of 2011 and underlying earnings before interest‚ tax‚ depreciation and amortisation of $52.7m‚ down from $90.8m in the comparable period last year.
Its attributable net profit declined to $14.3m from $28.9m.
Operationally‚ the group reported a continued solid performance at the Letseng mine in Lesotho‚ producing 57 116 carats‚ up 8% from last year‚ and posting a recovered grade of 1.68 carats per 100 tonnes‚ also up 8%.
The group said good progress was made on the Letseng production expansion project‚ called Project Kholo‚ which began in January 2012.
Ore mined at Ellendale in Australia came in at 2.0 million tonnes‚ up 234%‚ with 2.1 million of ore treated‚ up 44% from the first half of 2011. Ellendale’s carat production rose 51% to 78 881 carats.
The Ghaghoo mine development project is under way‚ with US$37m of the capital budget spent to date.
The company said it remained committed to doubling production at Project Kholo and the development of Ghaghoo in Botswana.
However‚ in light of the current economic climate and to maintain the company’s strong balance sheet‚ the board has decided to extend the completion dates of Project Kholo and Ghaghoo.
It said it would keep the global economic environment under review and‚ should market conditions improve materially‚ the project execution would be accelerated.
Commenting on the results‚ Gem Diamonds CE Clifford Elphick that‚ said against a challenging price backdrop for the diamond industry‚ the first half of 2012 was marked by strong operating performances at both producing mines‚ Letseng and Ellendale.
“Letseng reported an increase in both carats recovered and recovered grade compared with H1 2011‚ with cash costs being held in line with management estimates.
"Ellendale reported a significant increase in both ore mined and treated‚ and carats produced‚ which achieved strong prices during the period despite the challenging market conditions.”
Elphick said the group’s strong balance sheet‚ with $139m of cash as at end-June 2012‚ no debt and strong operating cash flows positioned it well to weather the current downturn in the diamond market.
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