Record prices mean record earnings for Gem Diamonds

19th Aug 2011 07:49

High diamond prices have helped Gem Diamonds achieve record earnings in the first six months of 2011, which surged almost five-fold compared with the first half of 2010.Earnings before interest, tax, depreciation and amortisation jumped to $90.8m (£54.99m), a significant increase on the $18.5m (£11.2m) achieved in the same period the year before. The result also surpassed the $82m earned in the whole of 2010."The first half of 2011 has seen the continued benefit of Let?eng having a more active role in managing its sales and marketing strategy, as well as the implementation of the downstream initiatives," said chief executive officer Clifford Elphick."Lower stocks of rough and polished diamonds in the cutting centres and strong diamond jewellery demand from India and China have resulted in record rough diamond prices being achieved, reflected in rising polished diamond prices," he said.The Let?eng mine (in which Gem owns a 70% interest) achieved a record average value of $3,052 per carat for its exports, higher than the $1,728 price seen the year before.Revenue jumped from $103.9m to $196.5m, while pre-tax profit from continuing operations climbed to $79m, from just $7.8m the year before. Earnings per share from continuing operations was 21.76 cents, compared with 1.72 cents.No dividend was paid.BC