Diamond sales appear to have survived the global economic slowdown and demand for the gem remains strong, De Beers said on Friday on release of its interim results for the first half of 2003.
De Beers’ marketing arm, DTC, reported sales of $2,9-billion (R21,8-billion) in the six months to June 30, which was 2,75% up on the same period in 2002, the company said in a statement.
De Beers reported headline earnings of $414-million (R3,1-billion), 34% more than 2002. The company said the industry started the year ”cautiously optimistic” but retail sales lost momentum due to the economic slump, the war in Iraq and the impact of the Sars virus on the Asian economies.
Sales had since recovered in line with growing consumer confidence and global sales were flat to slightly positive, De Beers said.
During the period under review, the willingness of cutting centres told hold bigger inventories helped drive demand for rough demand.
”If the strong demand for rough diamonds continues through the second half, De Beers’ results for the year as a whole should be ahead of the previous year,” the company said.
The company also said it had recently completed a five-year $2,5-billion (R18,8-billion) syndicated multi-currency revolving loan which would replace its existing facilities.
This was done because of the company’s exceptionally strong operating cash flow generated in the two-year period to June 2003. – Sapa