Alrosa's Revenue Falters on Weak Prices

RAPAPORT... Alrosa's sales fell in the first quarter amid lower rough pricesand a larger proportion of small diamonds. Revenue from rough stones slid 37% year on year to $988million for the three months ending March 31, the Russia-based miner saidWednesday. Sales volume declined 21% to 10.6 million carats, while the averageprice decreased 20% to $123 per carat for gem-quality diamonds. Prices dropped3.1% versus the fourth quarter of 2018 on a like-for-like basis, it added. "Average realized prices of rough, gem-quality diamondsdecreased...due to a larger share of small-size diamonds and lower prices mostlyfor medium-size diamonds," Alrosa explained. Polished-diamond sales plummeted 31% to $16.4 million forthe period. Production grew 5% to 7.8 million carats during the quarteras the miner increased ore processing at its Botuobinskaya pipe and ramped upthe Udachny underground mine. Alrosa also raised output at its Severalmazdivision, as it processed higher-grade ore. In addition, it launched operations at theVerkhne-Munskoye deposit. The company's inventory increased 16%to 14.3 million carats as of March 31, compared with a yearearlier. The miner has forecast a 4% increase in production to 38million carats for 2019, compared with 36.7 million carats last year. Image: The Botuobinskaya pipe. (Alrosa)