Wrap Text
Rockwell achieves higher prices for third quarter diamond sales
ROCKWELL DIAMONDS INCORPORATED
(A company incorporated in accordance with the laws of British
Columbia, Canada)
(Incorporation number BCO354545)
(Formerly Rockwell Ventures Inc.)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI ISIN: CA77434W2022
Share code on the TSX: RDI CUSIP Number: 77434W103
Share code on the OTCBB: RDIAF
ROCKWELL ACHIEVES HIGHER PRICES FOR THIRD QUARTER DIAMOND SALES ON
THE BACK OF BETTER QUALITY STONES FROM SAXENDRIFT
January 2, 2013 Vancouver, BC – Rockwell Diamonds Inc. ("Rockwell" or
the "Company") (TSX: RDI; JSE: RDI;) today announced a 23% improved
revenue from diamond sales, before any sales from beneficiation, for
the third quarter fiscal 2013 compared to the same period last year.
Total proceeds of US$7.4 million were generated compared to US$6.0
million for the same period a year ago and US$ 6.8 million for the
second quarter. A total of 4,043 carats were sold at average price of
US$1,821 per carat; and although the number of carats sold was 25%
lower, the sale of several high quality stones underpinned the 64%
increase in the average price per carat over a year ago.
Diamond sales and revenue for the Company’s operational mines for the
quarter ended November 30, 2012 is as follows:
Price per
Carats Revenue (US$)
carat (US$)
Q3 Q3
Q3 2013 Q3 2012 Q3 2013 Q3 2012
2013 2012
Saxendrift +
1,647* 1,761 2,912,196 3,332,902 1,768 1,892
Saxendrift
Extension
Saxendrift 10,70
284 - 3,039,812 - -
Bulk X-ray 4
Tirisano 214 1,625 74,383 1,272,214 348 783
Klipdam 1,490 1,990 982,957 1,356,388 660 681
Other** 408 - 352,055 - 863 -
Total sales 4,043 5,376 7,361,403 5,961,504 1,821 1,109
* Comprising 566 carats from Saxendrift and 1,081 carats from
Saxendrift Extension Project
**Other refers to gravel processed by independent contractors and
sold through the Group’s tender. These carats are excluded from grade
calculations.
THE SALIENT FEATURES OF THE THIRD QUARTER DIAMOND SALES ARE AS
FOLLOWS:
Carats sold from the Saxendrift Complex, comprising the Saxendrift
Mine, the Saxendrift Extension and the Bulk X-ray plant increased by
10% to 1,931 carats at an average price of US$3,082 per carat. The
average carat value of US$1,768 for Saxendrift was down 7% on the
same period last year, largely, because of the third quarter product
mix. This price drop compared well to the 15% decline in the global
market price for rough diamond prices in the +2 carat category that
comprises most of the mine’s production.
Sales of diamonds recovered from the Bulk X-ray plant, also at
Saxendrift, generated total proceeds of $3.0 million from the sale of
284 carats, including a 145-carat rough diamond whose sale increased
the average price per carat from the plant to US$10,704.
Diamond sales from Tirisano totaled 214 carats; mining operations of
Tirisano were placed on care and maintenance in the first week of
December 2012, due primarily to persistent industrial relations
issues.
Carats sold from Klipdam declined 25% for the quarter to 1,490 carats
while the average value declined only marginally to US$660 per carat.
In line with expectations, the grade was down 25% quarter on quarter
as mining migrated out of the high-grade portion of the channel.
NOTABLE STONES
The Company continued to produce large stones at all its operations:
51 stones exceeding 10 carats were recovered during the third
quarter:
Number of
+10 carat Number/Description of +50 carat stones
stones
5 stones including a 63.21-carat fancy
Saxendrift +
yellow, sawable, clean and a 77.84-carat
Saxendrift 17
makeable shape; commercial color and clean
Extension
rough
Saxendrift 3 stones including a 145.51-carat,
3
Bulk X-ray makeable, gem color, clean
Tirisano 2 -
One 73.52-carat fancy yellow; sawable,
Klipdam 20
spotted stone
These diamonds were channelled into the Company’s beneficiation joint
venture with Steinmetz Diamond Group (SDG), which delivers value
added future revenues for Rockwell’s stones that are larger than 2.8
carats, once they have been polished and sold by SDG. Rockwell now
has over 5,500 carats in the beneficiation pipeline.
“The 23% year-on-year increase in diamond sales for the third quarter
is a step in the right direction, reflecting improved operational
efficiency and enhanced by several rare and high quality stones that
were recovered. In particular, our operations in the Middle Orange,
which are the engine of Rockwell’s future growth, produced a number
of diamonds exceeding 50 carats in size; there was a 64% increase in
average price over a year ago to US$1,821 per carat, in part because
of that. The first cash flows from our royalty mining contracts were
also realized,” said Rockwell President and CEO James Campbell.
Commenting the diamond market, Campbell said: “Following weakness
during the first part of the year, the diamond market started the
third quarter on a cautious note. However, Rockwell experienced high
level of interest at final tenders for the year, underpinning a
willingness to pay slightly higher prices for our product. We are
optimistic for next year, although the momentum of the market will be
largely dependent on strong Christmas sales and further restocking of
inventories. With an inventory of 2,704 carats carried forward into
the fourth quarter, we are well placed to take advantage of any
possible restocking trend.”
For further information on Rockwell and its operations in South
Africa, please contact
James Campbell CEO
+27 (0)83 457 3724
Stéphanie Leclercq
Investor Relations
+27 (0)83 307 7587
ABOUT ROCKWELL DIAMONDS:
Rockwell is engaged in the business of operating and developing
alluvial diamond deposits, with a goal to become a mid-tier diamond
production company. The Company has two operational mines, which it
is progressively optimizing, as well as a third mine which will come
into production in the first quarter of 2013. Rockwell also has two
development projects and a pipeline of earlier stage properties with
future development potential. The operations are based on high
throughput processing capability and Saxendrift, the flagship mine
has among the lowest unit costs in the industry, as a result of
implementing fit for purpose technologies.
The Company is known for producing large, high quality gem stone
diamonds comprising a major portion of its diamond recoveries and has
a beneficiation joint venture that enables it to participate in the
profits on the sale of the polished diamonds.
Rockwell also evaluates merger and acquisition opportunities which
have the potential to expand its mineral resources and production
profile and would provide accretive value to the Company.
No regulatory authority has approved or disapproved the information
contained in this news release.
Forward Looking Statements
Except for statements of historical fact, this news release contains
certain "forward-looking information" within the meaning of
applicable securities law. Forward-looking information is frequently
characterized by words such as "plan", "expect", "project", "intend",
"believe", "anticipate", "estimate" and other similar words, or
statements that certain events or conditions "may" or "will" occur.
Although the Company believes the expectations expressed in such
forward-looking statements are based on reasonable assumptions, such
statements are not guarantees of future performance and actual
results or developments may differ materially from those in the
forward-looking statements.
Factors that could cause actual results to differ materially from
those in forward-looking statements include uncertainties and costs
related to exploration and development activities, such as those
related to determining whether mineral resources exist on a property;
uncertainties related to expected production rates, timing of
production and cash and total costs of production and milling;
uncertainties related to the ability to obtain necessary licenses,
permits, electricity, surface rights and title for development
projects; operating and technical difficulties in connection with
mining development activities; uncertainties related to the accuracy
of our mineral resource estimates and our estimates of future
production and future cash and total costs of production and
diminishing quantities or grades of mineral resources; uncertainties
related to unexpected judicial or regulatory procedures or changes
in, and the effects of, the laws, regulations and government policies
affecting our mining operations; changes in general economic
conditions, the financial markets and the demand and market price for
mineral commodities such and diesel fuel, steel, concrete,
electricity, and other forms of energy, mining equipment, and
fluctuations in exchange rates, particularly with respect to the
value of the US dollar, Canadian dollar and South African Rand;
changes in accounting policies and methods that we use to report our
financial condition, including uncertainties associated with critical
accounting assumptions and estimates; environmental issues and
liabilities associated with mining and processing; geopolitical
uncertainty and political and economic instability in countries in
which we operate; and labour strikes, work stoppages, or other
interruptions to, or difficulties in, the employment of labour in
markets in which we operate our mines, or environmental hazards,
industrial accidents or other events or occurrences, including third
party interference that interrupt operation of our mines or
development projects.
For further information on Rockwell, Investors should review
Rockwell's home jurisdiction filings that are available at
www.sedar.com.
Johannesburg
2 January 2013
Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)
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