Gem Diamonds faced a decline in revenue during the third quarter due to a combination of lower diamond prices in a challenging market environment and a decrease in the proportion of large stones sold. Sales from the Letšeng mine in Lesotho for the three months ending September 30 dropped by 45% YoY, amounting to $31.4 million. Sales volume also witnessed a 14% decrease to 23,955 carats, with the average price per carat falling by 35% to $1,310. Additionally, revenue saw a 10% decline from the previous quarter, with the average price down by 1%.
The challenging market conditions were attributed to the downturn in the global rough-diamond market in 2023, exacerbated by a decrease in the recovery of large, high-value diamonds. Consequently, this impacted the average dollar per carat and revenue during this period.
Despite these challenges, Gem Diamonds managed to sell four diamonds for over $1 million each, generating $6.1 million in revenue during the period, although this was notably lower than the previous year, which saw the sale of 10 diamonds in that range, totaling $25.1 million. Notable achievements during the period included the sale of a 5.96-carat pink diamond for $67,853 per carat and a 58.71-carat white, type IIa rough diamond that sold for $36,399 per carat.
The company's production increased by 8% to 26,913 carats for the period, and it recovered one diamond exceeding 100 carats. The company plans to sell this notable stone in the fourth quarter.
In the first nine months of 2023, Gem Diamonds saw a 34% decline in revenue, amounting to $103 million. The average price per carat decreased by 26% to $1,353, and sales volume dropped by 10% to 76,118 carats.