Theimminentarrivalofthegift-givingseasoninthemajorUSmarketshouldprovidesomestimulustopricesintheshortterm,butthesupplystrategyofthemajorproducersinanilliquidandfullysuppliedmarket,aswellastheaftermathofHurricaneSandyintheUSmayhaveanimpact,thecompanyadded。

ProductionatthecompanysLesothooperationshavebeenhamperedbyseverewintersnowconditions,withtheamountoforeminedinthethirdquarterdown13%onayearearlier,whileoretreatedwasdown8%andcaratsrecoveredweredown9%。

CaratsfromLesothosoldduringthethirdquarterweredown10%onayearearlier,leadingtoa38%declineinthevalueofsalesto$34。

4mfrom$55。

2mtheyearbefore。

TheEllendaleoperationsachievedanoverallaveragepriceof$618percaratinthethirdquarter,downfrom$1,015percaratinthecorrespondingquarterof2011。

CaratproductionatEllendalewasup28%overthecorrespondingperiodin2011。

Thegrouphas$94。

0mcashasatOctober31st,ofwhich$79。

0misattributabletoGemDiamonds。

ProjectKholocontinuesandcertainoftheworkstreamshavebeenprioritisedwithaviewtotheacceleratedenhancementofrevenue。

Inthisregardnewsecondarycrusherswithimprovedlinerprofileswillbeinstalledinthecurrentplantsin[thefirsthalfof]2013withtheobjectofreducinglargestonedamagethusimplementingoneofthekeystrategicobjectivesofProjectKholoearlierthanoriginallyplanned。

Thishastheadvantageofpotentiallyachievingrevenueimprovementthroughrelativelylightcapitalexpenditure,commentedCliffordElphick,ChiefExecutiveOfficerofGemDiamonds。

ItispleasingtoseegoodprogressatGhaghoowiththeerectionoftheplantandmillprogressingwellandwiththetunnelconstructionresumedandprogressingalbeitataslowerratethanexpectedduetotheadversegroundconditionsencountered,Elphickadded。

JH

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