De Beers posts $550m second cycle diamond sales as consumer demand continues revival

DE Beers recorded a year-on-year increase in second cycle diamond sales totaling $550m, providing further evidence the sector was back on its feet and recovering fast.

“We saw the continuation of good rough diamond demand during our second sales cycle of 2021 on the back of positive consumer demand for diamond jewellery,” said Bruce Cleaver, CEO of De Beers in a statement today.

Diamond jewellery retail sales during the first cycle, which takes in Christmas, Chinese New Year and Valentine’s Day, were “better than expected”, he added. Sales for the first cycle of the year were today formally recorded at $663m.

However, the market is set to enter a period of “lower seasonal demand”, said Cleaver. He added: “While the year has started positively, we recognise ongoing near-term uncertainty in the pace and shape of the recovery”.

Second cycle sales last year, just as Covid-19 disease was beginning to take grip globally, totalled $362m.

Covid-19 restrictions related to travel continue to impede business activity, especially in the diamond sector where diamantaires normally make personal visits to inspect goods.

De Beers said that in response to these conditions it continued to implement “a more flexible approach to rough diamond sales”. This includes extending the ‘Sight’ event beyond its normal week-long duration.

Diamond production guidance from De Beers, in which Anglo American has an 85% stake, has been adjusted to between 32 to 34 million carats for 2021 compared to guidance of 33 to 35 million carats previously.

Speaking at Anglo American’s 2020 results presentation in February, the group’s CEO, Mark Cutifani, said he expected diamond demand to continue to follow global GDP and personal disposable income which were expected to grow about 3% over the next decade “… as we better target advertising and key customer segments”.

De Beers reported underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $415m for the 2020 financial year, a 25% year-on-year decline. At 25.1 million carats, production was 18% lower year-on-year.