Gem Diamonds lifts Q3 production
JOHANNESBURG (miningweekly.com) – LSE-listed Gem Diamonds’ share price rose by as much as 5.37% to 104.58p on Wednesday, compared with Tuesday’s close of 99.25c.
This came on the back of higher production at the Letšeng and Ghagoo operations, paired with reduced costs in the quarter ended September 30.
In the period under review, 70%-owned Letšeng, in Lesotho, produced 29 600 ct, up 7% from the previous quarter.
At Ghaghoo, in Botswana, 115 diamonds greater than 4.8 ct each were recovered during the period, including 13 diamonds larger than 10.8 ct. In total, the miner recovered 31 923 ct, up 35% from the previous quarter, including two blue rough diamonds weighing 2.2 ct and 1.5 ct.
Guidance for full-year production had now been marginally upgraded to between 105 000 ct and 108 000 ct, compared with the 102 000 ct to 107 000 ct forecast in March.
Gem reported that it achieved an average price of $2 578/ct in the quarter under review, with 13 rough diamonds achieving more than $1-million each, including an exceptional quality 357 ct Type IIa white diamond, which achieved $19.3-million on tender.
Three diamonds, each larger than 100 ct, were also sold during the period.
"It is pleasing to see that the prices achieved for Letšeng's diamonds during the third quarter have remained robust despite the challenging market conditions experienced throughout this period.
“The large high-quality diamonds, for which Letšeng is renowned, have contributed to a strong third quarter average price,” Gem Diamonds CEO Clifford Elphick commented.
Investment bank Liberum Capital on Wednesday recommended that investors continue to buy Gem Diamonds’ shares. “While newsflow relating to diamond demand and pricing continues to be poor, Gem's revenues are proving resilient, with Letšeng producing a consistent stream of diamonds larger than 100 ct,” it said in a statement.
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