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Gem Diamonds sees ‘strong’ demand for high quality Letšeng diamonds in 2022

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(Kitco News) - Gem Diamonds (LSE: GEMD) announced yesterday that in H1 2022, the company recovered 55 157 carats (H2 2021: 56 504 carats) and sold 57 075 carats (H2 2021: 54 573 carats).

According to a press-release, the company generated H1 2022 revenue of US$99.6 million (H2 2021: US$97.3 million) and achieved an average price of US$1 745 per carat (H2 2021: US$1 783 per carat).

The company said that the highest price achieved in H1 2022 was US$66 059 per carat for an 8.41 carat pink diamond, adding that 15 diamonds sold for more than US$1.0 million each, generating revenue of US$25.8 million during the period.

Gem Diamonds added that three diamonds greater than 100 carats (244.34, 127.58 and 124.65 carats) were recovered during the period, which were sold in the first tender after period end for US$13.9 million. 

Importantly, the company said it ended the period with US$24.2 million cash on hand.

CEO Clifford Elphick commented, "We continue to see a firm diamond market for the high quality Letšeng diamonds in 2022. We are managing the economic impact of global events which are contributing significantly to the slowing down of global economic growth and which are materially impacting energy and commodity prices and disrupting supply chains worldwide.

"The sanctions imposed on the Russian diamond producer Alrosa have exacerbated a shortage of rough diamonds in the market, supporting continued strong demand and robust prices for Letšeng's high-quality rough diamonds."

Gem Diamonds is a leading global diamond producer of large high value diamonds. The company owns 70% of the Letšeng mine in Lesotho and is currently in the process of selling its 100% share of the Ghaghoo mine in Botswana.

The company noted that the Letšeng mine is famous for the production of large, exceptional white diamonds, making it the highest dollar per carat kimberlite diamond mine in the world.

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