Gem Diamonds, a global diamond producer with diamond mining operations in Lesotho and Botswana, head offices in London and sales, marketing and manufacturing capabilities in Antwerp, saw revenues ($109.1 million) and profits ($13.4 million) fall by 7.5% and 13% respectively in H1 2016 as its two mines trended in opposite directions. Their Letšeng Mine in Losotho, known for its high quality-high value diamonds performed well with steady prices achieved: Gem increased the waste tons mined to 15.3 million tons from 11.4 million tons in H1 2015, treating a "notable increase" of 3.3 million tons compared to 3.1 million tons in 2015 and recovering 57,380 carats compared to 50,019 in H1 2015. Gem earned an average value of $1,899 per carat compared to $2,264 in H1 2015 from the always exceptional Letšeng Mine, with 20 diamonds achieving a sales value of greater than $1 million each, including an exceptional Type II 160.2 carat diamond recovered. Clifford Elphick, Chief Executive of Gem Diamonds, said: "The first half of 2016 saw a decline in the number of +100 carat diamonds recovered at Letšeng compared to 2015, reflecting the areas in which mining had taken place, which impacted the US$ per carat achieved in the period. Since the beginning of July, two exceptional diamonds of 104 carats and 85 carats have been recovered as mining moves to a different area."
Gem Diamonds also had to overcome a massive snowstorm in July. Elphick: "In late July, some of the heaviest snowfalls in the past decade were experienced at Letšeng. Waste tonnes mined and carats recovered will remain within original guidance but tonnes treated will reduce to 6.6 - 6.8 million tonnes from 6.8 - 7.0 million tonnes. Letšeng provided accommodation and food to approximately 250 local people who were experiencing life-threatening conditions during the severe weather. The Deputy Prime Minister and a government delegation which visited the mine thanked management for its assistance to the community."
At its more conventional Ghaghoo Mine in Botswana, in H1 Gem Diamonds treated 95,569 tons of ore (132,125 in H1 2015) and recovered 20,876 carats (35,283 in H1 2015). Total sales achieved of $4.8 million, at an average of $157 per carat. The period also brought a $40.0 million non-cash impairment to the Ghaghoo asset, an attributable loss of $26.6 million and basic loss per share of 19.23 US cents. Said Elphick: "At Ghaghoo we continue to make good progress to downsize the operation and reduce costs in line with the Group's strategic objectives. Targeted production rates and cost levels are anticipated to be achieved in H2 2016. The ongoing weak market for Ghaghoo type diamonds has resulted in a non-cash impairment of US$40.0 million being made against the carrying value of this asset." Gem Diamonds paid an ordinary dividend of 5 US cents per share ($6.9 million) and special dividend of 3.5 US cents per share ($4.9 million) on 14 June 2016.