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Diamond industry feels the pinch as De Beers Group reports 54% drop in revenue

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De Beers Group has announced a 54% year-on-year drop in revenue compared to the first half of 2019.

Last year its revenue totalled $2.6 billion (£1.98 billion) in Q1 and Q2, but this year topped out at $1.2 billion (£915 million) in the same period.

Its latest financial report began: “All parts of the diamond supply chain were severely impacted by the global lockdown measures introduced in response to the COVID-19 pandemic in the first half of 2020.”

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The company went on to say: “From February, the COVID-19 outbreak began to have a significant impact on diamond jewellery retail sales and supply chain. Jewellery retailer restocking has therefore been very limited, with many jewellers suspending all polished purchases and/or delaying payments to their suppliers.”

It added that year-on-year rough diamond sales volumes in the first half of 2020 decreased by 45%, from 15.5 million carats to 8.5 million carats.

Meanwhile, the average realised price decreased to $119 per carat (£90) from $151 (£115).

The company said that its recently reopened retail stores across the world are showing strong signs of recovery, boding well for the future.

It concluded its financial report: “The current market outlook is highly uncertain owing to the possibility of a second wave of COVID-19 infections, the ability of fiscal and monetary measures to continue to support employment and businesses in consumer countries, as well as the shape and strength of the global macro-economic recovery.

“In the longer term, the outlook for the diamond sector remains positive, and De Beers is accelerating its business transformation – from discovery and mining, to how we sell rough diamonds to customers and how consumers purchase diamond jewellery – to ensure it retains its prime position as the world’s leading diamond business.”

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Sam Lewis

The author Sam Lewis

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