Gem Diamonds reported a significant decline in profit for the full fiscal year of 2023, with earnings from its Letšeng deposit in Lesotho dropping to $1.6 million compared to $20.2 million in 2022.
CEO Clifford Elphick attributed the decline to various global challenges, including economic uncertainties, conflicts, and a subdued diamond market.
The company’s revenue fell by 26% to $140.3 million, primarily due to lower rough diamond prices resulting from the market downturn.
Sales volume decreased by 3% to 104,520 carats, while the average price per carat dropped by 24% to $1,334.
Gem Diamonds derived most of its revenue from rough diamond sales, supplemented by agreements with diamond manufacturers.
Despite the challenges, Gem Diamonds saw a slight increase in output and continued its significant discoveries, including five stones exceeding 100 carats.
Notably, the miner achieved high prices for certain diamonds, including a 7-carat pink diamond sold for $282,889 per carat.
Looking ahead, Gem Diamonds anticipates a slow improvement in sales for 2024, with some signs of price recovery.
However, uncertainties in global economic growth and geopolitical landscapes, including upcoming national elections, may continue to impact the market.
CEO Elphick remains cautiously optimistic about the potential stabilization of prices and gradual growth towards the end of the year.
