Drop in Large Stones Dents Gem Diamonds

RAPAPORT... Gem Diamonds' profit fell in the first half of the year, asthe volume of large stones unearthed at its Let??eng mine in Lesotho hassignificantly declined from last year. Profit plunged 75% to $6.6 million for the six months endingJune 30, the company reported Thursday. The miner recovered three stonesweighing more than 100 carats during the period, versus 10 of that size lastyear, and compared with the average seven mined in the first half between 2008and 2018. Revenue from rough diamonds fell 44% year on year to $94.5million, while sales volume dropped 10% to 55,714 carats. The average priceslid 38% to $1,697 per carat. The company sold 15 stones for more than $1million each, totaling $41.6 million, which was significantly down from the firsthalf of 2018. Production at Let??eng fell 8% to 56,668 carats as the minerretrieved a larger proportion of its ore from the main pipe. Diamonds from that area have a lower grade andquality than those in the Satellite pipe, which constituted most of the ore recoveredduring the same period last year, it explained. Gem Diamonds recorded a loss of $2.4 million from the costof discontinuing operations at its Ghaghoo site. It expects the sale of thatdeposit to be finalized in the second half of the year. The company has implemented a cost-cutting program, whichhas saved $42 million to date. It predicts it will reach its planned savings of$100 million by 2021. Image: The Let??eng mine. (Gem Diamonds)