Gem Diamonds Limited, announces its Half Year Results for the six months ended 30 June 2025. According to the Letšeng mine operational results, Gem Diamonds recovered 47 125 carats (H1 2024: 55 873 carats) show a tumbling recovery year over year! Average price of US$1 008 per carat achieved (H1 2024: US$1 366 per carat). The highest dollar per carat achieved for a white rough diamond during the Period was US$26 441 per carat.
Taking into account the prevailing market conditions, current diamond prices and exchange rates, the recoverable amount of Letšeng was assessed at Period end and an impairment of US$10.7 million was recorded to bring the carrying value in line with the recoverable amount. The impairment was allocated to goodwill which is now fully impaired.
In a response to market conditions, Gem Diamonds said, as reported in the trading update published on 23 July 2025, Gem Diamonds has implemented decisive measures to conserve cash and protect shareholder value in response to the prolonged weakness in global diamond prices, compounded by a weak US dollar and ongoing US tariff uncertainties. While the Company has met its production targets in H1 2025, it has not been immune to the sustained pressure on rough diamond prices.
Key short-term cashflow optimisation measures implemented include the short-term reduction of waste and access to additional Satellite Pipe ore to be treated, workforce rationalisation due to the scaled-back activities and a reduction in corporate costs.
Further waste mining reduction initiatives were implemented at Letšeng. Consequently, the life of mine has reduced from 2039 to 2035 using current pricing assumptions and costs. Annual throughput of approximately 5.0 million ore tonnes has been maintained. Should market conditions improve, the flexibility exists to again extend the life of mine.
Gem Diamonds remains committed to its long-term strategy of producing exceptional quality diamonds and is confident that the measures implemented will position the Group for a strong recovery when market conditions improve. The Company’s production and cost forecasts for FY2025 remain in line with the revised guidance as published in the trading update on 23 July 2025.
Commenting on the results today, Clifford Elphick, Chief Executive Officer of Gem Diamonds, said, “The industry continues to face significant challenges. Sustained pricing pressure, softer demand in key markets, ongoing macroeconomic and geopolitical uncertainty, and tariff uncertainties in respect of India, combine to create difficult trading conditions.
H1 2025 production targets were achieved, however, revenue decreased significantly. In response, key decisions to adapt the mine plan to reduce costs, necessitated the unfortunate retrenchment of 240 employees at Letšeng. While deeply regrettable, these actions position Letšeng to operate sustainably.”
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