Loss-Making De Beers to Cut $100m Overheads

By John Jeffay / December 10, 2023 / www.idexonline.com / Article Link

(IDEX Online) - De Beers is facing $100m of cuts to its annual overheads in the face of ongoing weak demand for diamonds.Parent company Anglo American said in an investor update on Friday (8 December) that the company has been loss-making in the second half of this year but was positioning itself for an expected bounce in demand.Despite early signs of a recovery, Anglo American's chief executive Duncan Wanblad said: "We are focused on streamlining De Beers, reducing the annual overheads by $100 million in a sustainable manner."He said capital expenditure for De Beers projects had been reduced for next year, with investment focused on high value opportunities such as the moves to underground mining at Venetia, in South Africa, and Jwaneng, in Botswana.Wanblad said Anglo American was planning $1.8bn of capex cuts across its entire portfolio of mining companies, which includes platinum, copper, nickel, iron ore, polyhalite and steelmaking coal.De Beers expects to sell around 25m carats this year, he added. "We believe the fundamentals for diamonds are strong and we are positioning ourselves to supply into that demand bounce."Demand and prices for diamonds have fallen as global GDP growth has fallen. But all cycles end and we believe that the current weakness is temporary."Pic shows processing plant at Venetia mine, South Africa, courtesy De Beers.

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