Gem Diamonds (GEMD) H1 2024 earnings summary

Executive summary

• Revenue increased 9% to $78.0 million, with EBITDA rising to $19.1 million, more than doubling year-over-year, driven by operational efficiencies and strong large diamond recoveries despite industry price pressure.

• Net profit attributable to shareholders was $2.0 million, reversing a prior loss, and EPS improved to 1.5 US cents.

• Net debt reduced to $8.4 million from $21 million at year-end, with $30 million cash on hand and $54.9 million in undrawn facilities.

• Operational focus included cost containment, efficiency, and sustainability initiatives.

Financial highlights

• 56,994 carats sold (up from 52,163), with average price $1,366/ct; carats recovered exceeded expectations.

• Operating costs dropped 18%, with total costs down 11% in dollar terms; direct cash costs per tonne treated fell to LSL243.84.

• Underlying EBITDA rose to $19.1 million from $8.4 million year-over-year.

• Attributable profit of $2 million, reversing a $1 million loss last year; EPS at $0.015 per share.

• Cash from operating activities reached $28.8 million.

Outlook and guidance

• Carats recovered guidance raised to 98,000–101,000; carats sold guidance increased to 100,000–103,000.

• Waste stripped guidance reduced to 5–6 million tonnes; ore treated guidance unchanged.

• Capital spend guidance set at $5–$7 million, trending to the lower end.

• Decarbonisation target of 30% by 2030 reaffirmed.

• Focus for H2: extend revolving credit facilities, further reduce mining and treatment costs, and review long-term mine plan.