1 February
2024
GEM DIAMONDS LIMITED
Q4 2023 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 October 2023 to 31 December 2023 ("Q4 2023" or the "Period").
Highlights:
·
All operational and financial metrics achieved for
FY 2023 were within or better than revised guidance.
- 32 142 carats were recovered during
the Period (+16% from Q3 2023), resulting in 109 656 carats
recovered for the year (FY 2022: 106 704 carats).
· 104 520 carats were
sold in FY 2023, achieving an average price of US$1 334 per carat
(FY 2022: 107 498 carats sold for US$1 755 per
carat).
·
The highest price achieved in the Period was US$33
745 per carat for a 117.09 carat white diamond which sold for
US$4.0 million.
· Six diamonds sold
for more than US$1.0 million each, generating revenue of
US$13.8 million during the Period.
·
Post Period end, a large high-quality 295 carat
white diamond was recovered and is scheduled to be sold in Q1
2024.
· Letšeng
successfully concluded the insourcing of its drill, load and haul
activities with no interruption to production.
·
No LTI's were reported during the Period.
The Group's AIFR for FY 2023 was at an all-time
low of 0.67.
Corporate and Financial:
·
The Group ended the Period with US$16.5 million
cash on hand and utilised facilities of US$37.8 million,
resulting in a net debt position of US$21.3 million at Period end.
The net debt position includes a part payment of US$13.4 million
relating to the purchase of the mining equipment pursuant to the
insourcing transaction. The balance of US$9.2 million was paid in
January 2024.
·
The Group had undrawn and available facilities of
US$45.9 million at Period end.
1. Diamond Market
The global rough diamond market
continued to experience downward pressure in Q4 2023. This
negatively impacted the average dollar per carat and revenue
achieved during the Period.
2. Letšeng Diamonds production
summary
|
|
H1
2023
|
Q3
2023
|
Q4
2023
|
Q3 - Q4
% Change
|
FY
2023
|
FY
2022
|
|
Waste tonnes
stripped
|
4 846
680
|
2 422
117
|
1 572 830
|
-54%
|
8 841
627
|
10 153
845
|
|
Ore tonnes
treated
|
2 467
250
|
1 233
987
|
1 323
428
|
7%
|
5 024
665
|
5 506
576
|
|
Satellite pipe
ore tonnes treated
|
1 269
987
|
850 013
|
849 031
|
0%
|
2 969
031
|
3 037
966
|
|
Carats
recovered
|
50 601
|
26 913
|
32 142
|
16%
|
109 656
|
106 704
|
|
Grade
(cpht)
|
2.05
|
2.18
|
2.43
|
10%
|
2.18
|
1.94
|
|
Carats
sold
|
52 163
|
23 955
|
28 402
|
16%
|
104 520
|
107 498
|
|
Total value
(US$ millions)
|
71.6
|
31.4
|
36.4
|
14%
|
139.4
|
188.6
|
|
Achieved
US$/carat
|
1 373
|
1 310
|
1 281
|
-2%
|
1 334
|
1 755
|
Overall tonnes treated by the Letšeng plants in
FY 2023 were comparable to 2022. The reduction from
5.5 million tonnes to 5.0 million tonnes was primarily due to
the expiry of Alluvial Ventures' processing
contract on 30 June 2022, which contributed 0.4 million
tonnes in that year. Initiatives to stabilise plant performance
during Q3 2023 by reducing throughput rates in the processing
plants resulted in improved plant availability leading to an
increase in tonnes treated and carats recovered from Q3 2023 to Q4
2023.
Taking into account the reduced
tonnes treated for FY 2023, total waste tonnes mined were
consequently reduced, which also had a positive impact on costs.
This reduction in waste tonnes remains in line with the optimised
mine plan and ensures future availability of ore. The slope
steepening of the active cutbacks in the Main pipe also contributed
to this reduction.
3. Frequency of recovery of
large diamonds
The table below represent the number of
diamonds recovered in each size category greater than 20
carats.
|
Size
category
|
2023
|
2022
|
Average
2008 - 2022
|
|
>100 carats
|
5
|
4
|
8
|
|
60-100 carats
|
13
|
18
|
18
|
|
30-60 carats
|
71
|
69
|
76
|
|
20-30 carats
|
107
|
108
|
114
|
|
Total diamonds > 20 carats
|
196
|
199
|
216
|
The number of large diamonds
recovered at Letšeng were similar to that
in the prior year, however the decrease in prices achieved in 2023
negatively impacted overall revenue achieved during the
year.
4. FY 2023 performance to revised
guidance
|
|
FY 2023
|
Revised
guidance
|
|
Waste tonnes mined (Mt)
|
8.8
|
9 -
11
|
|
Ore treated (Mt)
|
5.0
|
4.9 -
5.1
|
|
Satellite pipe ore treated
(Mt)
|
3.0
|
2.8 -
3.0
|
|
Carats recovered (Kct)
|
109
|
104 -
107
|
|
Carats sold (Kct)
|
104
|
102 -
105
|
|
Direct cash costs (before waste) per
tonne treated (Maloti)
|
288
|
285 -
305
|
|
Operating costs per tonne
treated1 (Maloti)
|
374
|
380 -
395
|
|
Mining waste cash costs per tonne of
waste mined (Maloti)
|
66
|
65 -
70
|
|
Total capex2 (US$ million)
|
9
|
13 -
15
|
1 Operating costs per tonne excludes royalty, selling costs,
depreciation and mine amortisation, but includes inventory, waste
and ore stockpile adjustments.
2Capex excludes US$22.6 million relating to the purchase of the
mining fleet at Letšeng.
FOR
FURTHER INFORMATION:
Gem
Diamonds
Limited
Kiki
Constantopoulos, Company Secretary
ir@gemdiamonds.com
Celicourt Communications
Mark
Antelme / Felicity
Winkles
Tel: +44
(0) 20 770 6424
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
producer of high value diamonds. The Company owns 70% of
the
Letšeng mine in Lesotho. 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