De Beers Profits Soar 33 Percent

De Beers announced its profits soared more than 33 percent over the past year—a number that may rankle its customers who complain they are losing money on their sight boxes.

The company’s operating profit over fiscal year 2014 climbed 36 percent to $1.4 billion, and revenue grew 11 percent to $7.1 billion, according to a statement from majority owner Anglo American. More than 90 percent of its revenue came from rough diamond sales, which rose 12 percent to $6.5 billion. 

Anglo CEO Mark Cutifani said De Beers accounted for 28 percent of its profits, making it the second largest contributor.

In a corporate video, CEO Philippe Mellier said the United States was strong for more of the year, although “the selling season around Christmas was a little below what we were expecting.”  

He admitted the market showed some weakness in the back third of the year, because of a lack of liquidity. But he said the market is seeing some “green chutes,” and the company expects a rebound.

He also said that the Forevermark brand was available in 20 percent more stores than the prior year and that its De Beers retail chain had done “pretty well” but did not give specifics on sales or profits.

In an audio interview, head of strategy Bruce Cleaver said that the company had spent more than $60 million building technology to detect synthetics, adding that undisclosed synthetics were a big concern of the company.

Cleaver later told Bloomberg he hopes the company can start instituting price increases this year, once the market improves.

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JCK News Director