De Beers profits up 72 percent to $939 mln
The world's top diamond producer De Beers announced an "exceptional" year in 2011, with profits up 72 percent to $939 million on surging consumer demand, in a results statement on Friday.
Total sales rose 26 percent to 7.38 billion dollars, even though production slipped to 31.3 million carats, down five percent from 2010.
“Our total sales for 2011, our second highest since privatisation, were boosted by exceptional rough diamond price growth fuelled by almost unprecedented consumer demand during the first half of the year,” De Beers chairman Nicky Oppenheimer said.
“The second half of the year saw a reduction in the rate of growth, as cutting and polishing centres found it increasingly difficult to secure debt financing from banks focused on shoring up their own balance sheets.”
De Beers’ new CEO Philippe Mellier said 2011 was an “exceptional year” with consumer demand up by 11-13 percent, fed by increased consumer demand for jewelry in China, India and the United States. Rough diamond prices were up 29 percent.
“In spite of uncertainty, and barring a global economic shock, we expect to see continued growth in global diamond jewellery sales, albeit at lower levels than the exceptional growth seen in 2011,” Mellier said.
“This will be driven by the overall strength of the luxury goods market, improving sentiment in the US (the largest diamond jewellery market), continuing growth in China, and the positive impact of the 2011 polished price growth on retail jewellery prices.”
De Beers produces and sells about 35 percent of world’s rough diamonds from its mines in South Africa, Botswana, Namibia and Canada.
Officially headquartered in Luxemburg, the company is run from London and Johannesburg.
Global miner Anglo American holds 45 percent of the company, and is buying the 40 percent stake held by the Oppenheimer family, in a deal announced in November.
The remaining 15 percent is held by the government of Botswana.