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Fading sparkle, fading hopes
BRC DiamondCore has announced the implementation of a "strategic suspension...
BRC DiamondCore has announced the implementation of a "strategic suspension of bulk sampling at its projects in South Africa’s Northern Cape province in view of current depressed diamond prices". In early trading in Toronto on Wednesday, the BRC DiamondCore stock price halved, leaving the fall from its record stock price at 97%, compared to a weighted average fall of 83% for the global diamonds sector.Diamond stocks are among the worst performing in the mining space, alongside stocks specialising in nickel, silver, tin, zinc, platinum and copper.BRC DiamondCore said that "all plant and equipment will be maintained and receive appropriate refurbishment in anticipation of a resumption of bulk sampling operations" at its Silverstreams alluvial project in early January 2009, with its Paardeberg East kimberlite and De Kalk alluvial projects expected to resume operations as diamond prices recover.Investors were given detailed information on the dramatic falls in diamond prices on 17 November, when London-listed Gem Diamonds, one of the world’s leading diamond miners, announced painful trading and operational updates, including the jarring news that the company may even post losses for the year to December 31 2008.The massive contraction in revenues at Gem Diamonds was illustrated by numbers released for its 70%-held Letšeng mine in Lesotho, famed for producing the highest value per carat output of any kimberlite diamond pipe in the world. The revenue for Letšeng diamonds has fallen from an average USD 2,512/carat in first-half 2008 to an average USD 1,382/carat, so far, in the fourth quarter. The average price per carat achieved at Letšeng in 2007 was USD 1,997/carat, compared to an industry average of USD 81/carat.On 17 November BRC DiamondCore announced a net loss of CAD 7.5m for the three month period ended 30 September 2008, and a net loss of CAD 12m for the nine month period, including a stock-based compensation expense of CAD 1.6m. On 30 September the company had CAD 6.1m in debt, and cash and cash equivalents of CAD 1.2m. Its debt is guaranteed by major shareholder Banro, the gold junior with gold interests in the Democratic Republic of the Congo. Banro has experienced a 92% overall contraction in its stock price.
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Selected diamond stocks |
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Stock |
From |
From |
Value |
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price |
high* |
low* |
USD bn |
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Bonaparte Diamonds |
AUD 0.04 |
-71.3% |
43.3% |
0.005 |
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Diamondex |
AUD 0.07 |
-86.3% |
100.0% |
0.008 |
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Target Resources |
GBP 0.03 |
-88.6% |
0.0% |
0.005 |
|
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Kimberley Consolidated |
ZAR 0.28 |
-81.3% |
40.0% |
0.012 |
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African Consolidated |
GBP 0.06 |
-82.4% |
0.0% |
0.020 |
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GBP 2.63 |
-78.4% |
39.8% |
0.244 |
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Shore Gold |
CAD 0.37 |
-92.6% |
48.0% |
0.054 |
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GBP 0.74 |
-52.3% |
8.8% |
0.201 |
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Mountain Province |
CAD 0.01 |
-73.9% |
24.1% |
0.064 |
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Firestone Diamonds |
GBP 0.22 |
-89.3% |
25.7% |
0.020 |
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African Diamonds |
GBP 0.36 |
-62.1% |
20.0% |
0.040 |
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Rockwell Diamonds |
ZAR 0.90 |
-80.0% |
20.0% |
0.021 |
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Trans Hex |
ZAR 3.45 |
-69.1% |
7.8% |
0.036 |
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Tawana |
ZAR 0.36 |
-55.1% |
71.4% |
0.004 |
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Pangea Diamondfields |
GBP 0.01 |
-98.6% |
0.0% |
0.001 |
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Namakwa Diamonds |
GBP 0.39 |
-78.9% |
0.0% |
0.068 |
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Kopane Diamonds |
GBP 0.02 |
-88.3% |
15.4% |
0.005 |
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Diamondcorp |
GBP 0.35 |
-64.1% |
0.0% |
0.019 |
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Stornoway Diamonds |
CAD 0.09 |
-88.2% |
5.9% |
0.018 |
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Vaaldiam Resources |
CAD 0.02 |
-97.6% |
50.0% |
0.003 |
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CAD 4.99 |
-87.9% |
4.6% |
0.243 |
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CAD 0.23 |
-96.7% |
15.0% |
0.005 |
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Averages/Total |
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-80.1% |
23.8% |
1.083 |
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Weighted averages |
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-82.5% |
20.7% |
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Diversifieds with diamonds |
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GBP 12.21 |
-66.8% |
19.2% |
24.198 |
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GBP 10.11 |
-54.1% |
38.2% |
92.978 |
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GBP 11.18 |
-84.4% |
1.8% |
23.824 |
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