De Beers sees revenues drop to $2.8bn in H1
Underlying EBITDA also decreased by 63% to $347m (£271.8m) compared with $944m (£739.6m) last year
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De Beers has revealed that its total revenue decreased to $2.8bn (£2.19bn), with rough diamond sales decreasing to $2.5bn (£1.96bn), during the first half of the year.
It said that the high levels of polished diamond inventory in the midstream coming into 2023, as well as the ongoing macroeconomic headwinds, impacted demand for rough diamonds.
Underlying EBITDA also decreased by 63% to $347m (£271.8m) compared with $944m (£739.6m) last year. This was driven by the lower average realised price and higher unit costs.
The average rough diamond price index also decreased by 2%, reflecting the overall “softening” in consumer demand for diamond jewellery and build-up in rough diamond inventory in the midstream.
However, total rough diamond sales volumes of 15.3 million carats were in line with the prior period (30 June 2022: 15.3 million carats), as a result of a higher proportion of lower value rough diamonds being sold in 2023.
In addition, its rough diamond production was essentially flat at 16.5 million carats (30 June 2022: 16.9 million carats), compared with a strong first half of 2022. This was due to strong operational performance in most regions, which was partially offset by the planned decrease in South Africa as the Venetia open pit transitions to underground operations.
In Botswana and Canada production increased by 9% to 12.7 million carats and 1.4million carats respectively.
Namibia production also increased by 21% to 1.2 million carats, primarily driven by the contribution from the Benguela Gem vessel, which commenced production in March 2022, and the ongoing ramp-up and expansion of the mining area at the land operations.
South Africa’s production, on the other hand, decreased by 59% to 1.2 million carats due to the planned completion of the Venetia open pit in December 2022.
De Beers said that despite the ongoing macroeconomic uncertainty, De Beers Jewellers delivered a “solid” first half performance with double digit growth in bridal and collections and continues to focus on developing the brand in China.
Looking ahead the group expects macroeconomic conditions to remain challenging over the near term, impacting consumer spending on diamond jewellery.
