De Beers’ sales for the first six months of 2004 totaled $2.9 billion, 2.16% higher than the equivalent period in 2003, slightly below analyst forecasts.
A statement noted that the DTC raised its prices twice during those six months, and the cumulative effect is that rough prices are 14% higher than the year before. The higher prices led to a big jump in the diamond account, to $5.8 billion from $4.8 billion last year.
Headline earnings for the six months were $4.2 billion, 12.8% higher than for the first half of 2003.
A De Beers statement said that retail sales of diamond jewelry in consumer markets grew around 7 to 8% during the first half of the year. It said that “the trade is optimistic that the strong consumer demand will continue through the second half and expectations are that retail sales for the year as a whole will be comfortably ahead of 2003.” Cutting center debt had not increased and will hopefully be reduced in the second half, it said.
Reports noted that the growth of sales had not been met with a growth in output, and said De Beers was having trouble meeting demand. Gary Ralfe told the Financial Times that De Beers had not meet its target of lifting capacity by 7 percent this year, and output dipped 2.6% in the first six months. One place it can’t go for diamonds right now is its stockpile, which the interim results said now stands $1.4 billion, down from $1.8 billion.