HomeDiamonds & GemstonesDe Beers sales, profit and production down

De Beers sales, profit and production down

De Beers “’ sales,
profit and production
London, England — MININGREVIEW.COM — 24 July 2009 – The world’s biggest diamond company “’ the De Beers Group “’ says first-half rough gem sales fell 57% on lower demand after the United States, Europe and Japan slid into recession.
In an e-mailed statement from here, De Beers said rough sales had dropped to US$1.4 billion (R11 billion) from a year earlier. Production had slid 73% to 6.6 million carats after the company had shut capacity in Botswana and Namibia. It had an underlying loss of US$164 million (R1.3 billion) compared with earnings of US$350 million (R2.8 billion).
“It is anticipated that carat production for the full year will be approximately 50% that of 2008,” said De Beers, which is 45% owned by Anglo American Plc. It produced 48.1 million carats last year.

Bloomberg News reports that De Beers is in talks with banks on the renewal of a US$1.5 billion (R12 billion) term loan facility which expires in March next year. Talks are expected to be completed in the second half, the company said. Net debt was US$4.06 billion (R32 billion) at the end of the first half.

“Rough diamond prices fell about 50% on average between October and mid-March, and have since gained almost 30%,” said Des Kilalea, an analyst at RBC Capital Markets in London.

“The second half should see improvement,” De Beers said.

Namdeb “’ a joint venture between Namibia’s government and De Beers “’ temporarily halted production from the beginning of April and Debswana “’ the joint venture between De Beers and the government of Botswana “’ suspended operations in February.