De Beers, the world’s largest diamond producer that is 45% owned by mining giant Anglo American, posted record diamond production of 49-million carats in 2005, according to newly appointed group MD Gareth Penny.
De Beers is set to unveil its 2005 annual results on Friday. The group reported production of 23,7-million carats in the first half of the year.
Addressing participants on the final day of the African Mining Indaba conference in Cape Town on Thursday, Penny also said De Beers is aiming to record earnings before interest, tax, depreciation and amortisation (Ebitda) of more than $2-billion by 2009, up from $1,3-billion to $1,4-billion in 2004. He did not reveal the group’s 2005 Ebitda.
However, he did say that De Beers’s estimated worldwide consumer demand for diamonds grew by between 5% and 6% in 2005 in local currency terms and by 6% to 7% in dollar terms. Consumer-demand growth is key for the company, he stressed.
Helping to drive that growth will be a new marketing drive, unveiled to the public for the first time at the indaba. Called “journey diamond jewellery”, the design features a series of progressively larger diamond stones that is meant to represent the journey of love over time. It will be rolled out worldwide shortly.
On the production and exploration front, Penny said the group has budgeted approximately $100-million for grassroots exploration in 2006, and aims to grow its own production steadily, as well as that through its joint ventures.
The company currently has 65 joint venture partners around the world. It is examining more farm out opportunities in Brazil, Australia, South Africa and Canada as well.
Penny expected De Beers’s R3,8-billion black economic empowerment transaction, agreed between its South African subsidiary De Beers Consolidated Mines (DBCM) and the Ponahalo consortium and announced in November, to be finalised by the end of the first half of 2006.
The deal will see a 26% stake in DBCM sold to Ponahalo, a newly formed black-owned company.
The company is in the process of finalising agreements on various beneficiation projects with the governments of South Africa, Namibia and Botswana, and will unveil its new Southern African beneficiation strategy in three months’ time, the MD concluded. — I-Net Bridge