De Beers’s diamond sales sparkle – by Allan Seccombe (Business Day – April 13, 2016)

http://www.bdlive.co.za/

DE BEERS, an Anglo American subsidiary, has notched up its third consecutive increase in rough diamond sales, with analysts forecasting a better-than-expected performance from what will be a major business in the Anglo stable.

Anglo has told the market it will focus on just 16 mines in diamonds, platinum, and copper, cutting its portfolio of 55 assets, as it strives to make inroads into about $13bn of debt, a number it wants to more than halve within four years.

De Beers, the world’s largest rough diamond producer by value, has undertaken a number of measures to correct a damaging market imbalance, with the cutting and polishing segment clogged with rough diamonds, a situation exacerbated by subdued diamond jewellery demand last year.

De Beers lowered prices 15% last year, and another 5% early this year, to stimulate demand and open profit margins in the cutting and polishing segment. It also slowed diamond production to correct the market imbalance.

The measures appear to be paying dividends, and De Beers notched up its third increase in sales revenue from sightholder purchases and auctions this month, despite increasing prices about 2%. De Beers sold a provisional $660m worth of rough diamonds this month, up from $617m in February and $545m in January. It had sold $248m worth of diamonds in its final sale last year.

For the rest of this article, click here: http://www.bdlive.co.za/business/mining/2016/04/13/de-beerss-diamond-sales-sparkle