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ROCKWELL DIAMONDS INCORPORATED - Rockwell first quarter dimond revenue, excluding Royalty Mining, up 31% as average carat values increase 109%

Release Date: 08/07/2013 14:30
Code(s): RDI     PDF:  
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Rockwell first quarter dimond revenue, excluding Royalty Mining, up 31% as average carat values increase 109%

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 FIRST QUARTER DIAMOND REVENUE, EXCLUDING ROYALTY MINING, UP
31% AS AVERAGE CARAT VALUES INCREASE 109%



July 8, 2013 Vancouver, BC – Rockwell Diamonds Inc. ("Rockwell" or
the "Company") (TSX: RDI; JSE: RDI;) announces a pleasing 31%
increase in revenue from diamond sales, excluding Contractors and
before any sales from beneficiation, for the first quarter of fiscal
2014 compared to the same period last year. This increase over the
same quarter last year occurs even though the Company placed its
Tirisano mine onto care and maintenance late in 2012 and sold its
Klipdam mine early in the quarter.

As a result of sales of high quality diamonds, Rockwell’s flagship
Saxendrift mine achieved a 48% year-on-year increase in average price
per carat received, with the value of sales up 56% year-on-year in
the first quarter. In addition, the first diamond sales from the
newly-commissioned Saxendrift Hill Complex were recorded, at an
average price per carat of US$3,668 from the sale of 130 carats.
Royalties in the first quarter to the Company totalled $134,749 on
diamond sales by the three royalty mining contracts at Tirisano on
revenue of $1.1 million.

Total revenue of US$6.6 million was recorded for the Company’s own
operations (excluding royalty mining contracts) from the sale of
3,257 carats at an average price of US$2,018 per carat compared to
US$5.0 million at an average value of US$962 for the same period in
fiscal 2013. Total carats sold from its own operations declined by
38% from 5,229 carats as the Company transitioned its production
focus exclusively to operations in the Middle Orange River region
which typically yield gem-quality diamonds. The sale of several
large, high-valued diamonds recovered in this region contributed to
the 109% increase in average price per carat from a year ago.

Diamond sales and revenue for the Company’s operations for the
quarter ended May 31, 2013 is as follows:

                                                         Price per carat
                    Carats             Revenue (US$)
                                                              (US$)
                                                                     Q1
              Q1 2014      Q1 2013   Q1 2014   Q1 2013   Q1 2014
                                                                   2013
 Saxendrift      2,148     2,037 5,485,585     3,516,185   2,553    1,727
 Saxendrift
                   130         -    476,818          -    3,668        -
 Hill Complex
 Tirisano           83     1,007     41,943    313,712      505       311
 Klipdam           895     2,185    569,645  1,200,803      636       550
 Total from
 own             3,257     5,229 6,573,991   5,030,700    2,018       962
 operations
 Saxendrift
                     -     1,005          -    857,090         -      853
 tailings
 Contractors*    1,730         - 1,077,982           -      623         -
 Total sales     4,987     6,234 7,651,873   5,887,790    1,534       944
*Contractors refers to gravel processed by independent royalty
contractors and sold through the Company’s tender process.
THE SALIENT FEATURES OF THE FIRST QUARTER DIAMOND SALES ARE:

- Carats sold from the Saxendrift operation increased 5% to 2,148
carats at an average price of US$2,553 per carat, resulting in a 56%
increase in revenue from diamond sales to US$5.5 million. The average
price per carat improved by 48% during the quarter, reflecting the
sale of a number of large, high quality diamonds that were recovered
during April 2013.

- Sales from the Saxendrift Hill Complex amounted to 130 carats at an
average price of US$3,668 per carat. Revenue from diamond sales from
Saxendrift Hill Complex for the period amounted to US$476,818.

- The remaining 83 carats from Tirisano’s inventory were sold at an
average value of US$505 per carat, generating total revenues from
diamond sales of $41,943 for the first quarter.

- Sales for the first quarter from Klipdam totalled 895 carats at an
average value of US$636 per carat, compared to 2,185 carats at an
average value per carat of US$550 in the comparable quarter. The
decline in carats sold is the result of the decision to sell the mine
at the end of March 2013, subsequent to which operations were
suspended. Total inventory of 53 carats was carried over to the
second quarter.

- A total of 1,730 carats derived from the three royalty mining
contracts operating at the Tirisano property were sold in the first
quarter. The value of these sales is $1.1 million at an average price
of $623 per carat. The Company’s 12.5% royalty from these sales was
applied against the care and maintenance costs at Tirisano. An
inventory or 370 carats was carried forward to the second quarter.

NOTABLE STONES
Rockwell continued to produce large stones at all operations,
including the recovery of 44 stones exceeding 10 carats during the
first quarter as described below:

- Saxendrift: 30 stones exceeding 10 carats, with the three largest
stones weighing 52.91 carats, 59.50 carats and 72.41 carats.

- Saxendrift Hill Complex: four stones exceeding 10 carats, including
a 53.16-carat stone.

- Klipdam: Four stones exceeding 10 carats.

These diamonds were channelled into the Company’s beneficiation joint
venture with Steinmetz Diamonds (SD), which delivers value-added
future revenues to Rockwell for stones larger than 2.8 carats that
have been polished and sold by SD.

“The high quality of diamond sales for the first quarter provides
further justification of our strategy to focus Rockwell’s production
growth to high potential assets in the Middle Orange River region,”
commented James Campbell, CEO and President, Rockwell. “We are
pleased to produce a 31% increase in revenue from diamond sales from
our own operations - before any beneficiation income. This
performance is underpinned by a 109% increase in our average diamond
values, more than making up for the 38% reduction in total carats
sold. It included several high quality diamonds from our flagship
Saxendrift operation and the newly commissioned Saxendrift Hill
Complex mine. As the operations at Saxendrift Hill Complex and
Niewejaarskraal (currently in commissioning) are established and
reach their nameplate capacity, we are positioned to make up the
sales shortfall from Tirisano and Klipdam.”

Campbell added that: “Moreover, the royalty mining contracts are
performing well. Our 12.5% royalty from these diamond sales is set to
contribute more meaningfully going forward with the addition of two
new contracts at Tirisano and a further agreement reached for
Zwemkuil, another Rockwell property in the Middle Orange river
region.”



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.


8 July 2013
Johannesburg
Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)

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