De Beers reports strong H1 growth

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EBITDA doubles on H1 2009 as market recovers.

De Beers has reported strong growth for H1, 2010, with EBITDA doubling on the same period last year, to US$762 million.

Sales of rough diamonds increased on the previous year by 84 percent in H1, 2010, to $2.6 billion. This was attributed to higher demand from retail markets, particularly India and China, in addition to restocking by the trade.

The carats recovered also more than doubled from the first half of last year to 15.4 million, due to an increased demand from DTC Sightholders.

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Production and operating costs also rose by almost half to $699, as a result of increased production across the Group. De Beers reduced its cost base globally by 45 percent in 2009 and staffing levels by 25 percent. It claims many of those gains have become permanent without affecting growth and has announced it intends to continue focusing on cash management, and efficiency improvements, this year.

De Beers chairman Nicky Oppenheimer said: “This time last year, in the midst of the global recession, we transformed our business – taking short-term pain for long-term gain. One year later, our results for the first half of 2010 show the success we’ve had in managing costs, creating operating efficiencies and improving our balance sheet.

“With renewed demand driving significant increases in production, prices and sales, we are now focused on securing the recovery while insulating the business from further market volatility.”

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