De Beers enjoys retail boost

Click to follow
The Independent Online
DE BEERS, the South African mining group, saw 1993 pre-tax profits rise 21 per cent from dollars 491m to dollars 595m on the back of rising diamond jewellery sales, Reuters reports.

The company, which controls 90 per cent of the world's diamond market, said there were signs that retail sales of the gem were back on track after several disappointing years.

Total diamond sales by De Beers' Central Selling Organisation for 1993 were a record dollars 4.37bn, up 28 per cent from dollars 3.42bn.

CSO sales for the second half of 1993 increased to dollars 1.82bn from dollars 1.63bn. The figures include a year's contribution from the Venetia mine.

The company said: 'After maintaining a high level in the recessionary years of 1990 to 1992, preliminary indications are that retail diamond jewellery sales resumed a rising trend in 1993.'

The CSO has had problems with diamonds from Russia since the break-up of the Soviet Union. There have been accusations that Russian diamonds have been sold directly in Antwerp, the main outlet for the gem, and not through the CSO as had been agreed.

De Beers' profits were equivalent to earnings per share of 157 cents, up from 129 cents. De Beers' 1993 combined net profit rose to dollars 873m from dollars 757m. The total dividend is increased 7 per cent to 84.4 cents, from 79.1 cents.

Spending on prospecting and development was dollars 90m (dollars 132m) and interest was lower at dollars 52m (dollars 73m), reflecting lower borrowings and rates.

Redemption of investments in preference shares and the lower value of the rand saw combined income from outside the diamond industry fall to dollars 172m from dollars 211m. Combined diamond stocks rose by dollars 359m to dollars 4,124m, and net current assets were dollars 71m (dollars 179m).