TIDMGEMD
RNS Number : 9656E
Gem Diamonds Limited
02 November 2022
2 November 2022
GEM DIAMONDS LIMITED
Q3 2022 Trading Update
Gem Diamonds Limited (LSE: GEMD) (" Gem Diamonds " or the "
Company " or the " Group ") provides the following Trading Update
detailing the Group's operational and sales performance from 1 July
2022 to 30 September 2022 (" Q3 2022 " or the "Period ").
Highlights:
-- Revenue generated in the Period amounted to US$56.6 million,
achieving an average price of US$2 028 per carat (Q3 2021: US$1 589
per carat).
-- 25 018 carats were recovered during the Period, resulting in
80 174 carats recovered for the year to date (YTD 2021: 82 266
carats).
-- 84 989 carats have been sold for the year to date, achieving
an average price of US$1 838 per carat (YTD 2021: US$1 782 per
carat).
-- The highest price achieved in the Period was US$79 543 per
carat for a 10.07 carat pink diamond.
-- 10 diamonds sold for more than US$1.0 million each,
generating revenue of US$25.1 million during the Period.
-- Four diamonds greater than 100 carats were sold during the
Period generating revenue of US$15.6 million. Three of these
diamonds were recovered in Q2 2022.
Corporate and Financial:
-- The Group ended the Period with US$17.4 million cash on hand
(excluding US$15.2 million of September tender proceeds that were
received after Period end).
-- Drawn down facilities amounted to US$12.0 million resulting
in a net cash position of US$5.4 million at Period end (excluding
US$15.2 million of September tender proceeds that were received
after Period end) (H1 2022: US$12.1 million).
-- The Group had undrawn and available facilities of US$65.3 million at Period end.
-- The 5.5 year term loan facility for the construction of the
mining complex at Letšeng, was fully repaid at the end of the
Period.
Gem Diamonds' CEO, Clifford Elphick, commented:
"It is pleasing to see that the average price achieved for the
Letšeng tenders for Q3 2022 exceeded US$2 000 per carat,
notwithstanding the current downturn in the global economy.
Post Period end, production at Letšeng was impacted by the
Lesotho general election on 7 October and the compulsory two-day
shutdown of operations legislated by the Government of the Kingdom
of Lesotho to allow voting in employee home wards. In addition, a
crusher breakdown was experienced in Plant 2, which has since been
repaired and the plant is running at normal capacity ."
1. Diamond Market
The downturn in the global economy has impacted the diamond
market. However, the tenders in Antwerp, together with a Dubai
tender viewing in September 2022, were well-attended and
contributed positively to the prices achieved during the
Period.
2. Letšeng
2.1. Rough Diamond Sales
H1 2022 Q3 2022 YTD 2022 YTD 2021 YTD 2022 vs YTD 2021 % Change
Carats sold 57 076 27 913 84 989 84 906 0%
-------- -------- --------- --------- ------------------------------
Total value (US$ millions) 99.6 56.6 156.2 151.2 3%
-------- -------- --------- --------- ------------------------------
US$/carat 1 745 2 028 1 838 1 782 3%
-------- -------- --------- --------- ------------------------------
2.2. Production
H1 2022 Q3 2022 YTD 2022 YTD 2021 YTD 2022 vs YTD 2021 % Change
Waste tonnes stripped 6 289 380 2 116 761 8 406 141 14 167 058 -41%
---------- ---------- ---------- ----------- ------------------------------
Ore tonnes treated 3 017 644 1 246 209 4 263 873 4 642 844 -8%
---------- ---------- ---------- ----------- ------------------------------
Satellite pipe contribution (tonnes) 1 378 404 713 239 2 091 643 2 313 562 -10%
---------- ---------- ---------- ----------- ------------------------------
Carats recovered (1) 55 156 25 018 80 174 82 266 -3%
---------- ---------- ---------- ----------- ------------------------------
Grade recovered (cpht) (1) 1.83 2.01 1.88 1.77 6%
---------- ---------- ---------- ----------- ------------------------------
(1) Includes carats produced from the Letšeng Plants, the
recovery tailings treatment facility and the Alluvial Ventures (AV)
plant (Until 30 June 2022)
The 41% reduction in waste tonnes mined and the 10% reduction in
Satellite pipe contribution to tonnes treated YTD 2022 is in line
with the mine plan.
Letšeng's Plants treated a total of 1.2 million tonnes of ore
during the Period and in line with the mine plan, 57% was sourced
from the Satellite pipe, and 43% from the Main pipe.
2.3. Production Guidance
Post Period end, the Lesotho general election required a
compulsory two-day site wide shutdown at Letšeng to allow the
workforce to vote in their respective constituencies, resulting in
loss of production. In addition, post Period end, a secondary
crusher breakdown in Plant 2 and continued power disruption on the
energy supply network resulted in a loss of production. Repairs to
the secondary crusher have been completed and the plant is running
at normal capacity.
As previously reported in the H1 2022 Trading Update, the 2022
production metrics were guided to the lower end of the original
guidance as published in March 2022. The impact of the loss of
production in October has resulted in a revision of the full year
guidance for tonnes treated to approximately 5.45 million tonnes
(previously between 5.60 and 5.80 million tonnes). As a result of
the reduction in tonnes treated, guidance with respect to carats
recovered and carats sold has been reduced to approximately 104k
(previously 112k to 116k) and approximately 105k (previously 110k
to 114k) respectively. Cost guidance remains unchanged.
3. Sustainability
Gem Diamonds' Sustainability and Climate Change Reports were
nominated as finalists by the influential investor media platform
ESG Investing in two reporting categories and was announced the
winner of the 'Best Climate-Related Reporting (Small Cap)' award at
the ESG Investing Awards 2022. The award has been given to Gem
Diamonds for its 2021 "Our Approach to Climate Change" report which
focused on how climate change considerations are being incorporated
into financial planning and strategy at Gem Diamonds.
During the Period, no LTI's occurred at Letšeng, and the
Group-wide All Injury Frequency Rate was 0.67.
No major or significant community or environmental incidents
occurred across the Group during the Period.
FOR FURTHER INFORMATION:
Gem Diamonds Limited
Susan Wallace, Company Secretarial department
ir@gemdiamonds.com
Celicourt Communications
Mark Antelme / Felicity Winkles
Tel: +44 (0) 208 434 2643
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
The Gem Diamonds Limited LEI number is 213800RC2PGGMZQG8L67.
ABOUT GEM DIAMONDS:
Gem Diamonds is a leading global diamond producer of large high
value diamonds. The Company owns 70% of the Letšeng mine in Lesotho
and is currently in the process of selling its 100% share of the
Ghaghoo mine in Botswana. The Letšeng mine is famous for the
production of large, exceptional white diamonds, making it the
highest dollar per carat kimberlite diamond mine in the world.
www.gemdiamonds.com
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