The woozy U.S. economy sank De Beers’ diamond sales in the first half of the year, causing the numbers to plunge 25% from 2000 figures. Overall sales for the first half were $2.619 billion, still higher than the first-half tallies for both 1999 and 1998. A company statement noted that worldwide diamond jewelry retail sales are likely to be 5% to 7% lower this year than last.
In a press conference following release of the results, managing director Gary Ralfe noted that there was a surplus of polished in the .2-ct. to .75-ct. range and said the Diamond Trading Company (De Beers’ marketing arm) was removing from its sight boxes the rough that produces polished stones of that size.
The company also noted that if the European Commission approves its venture with LVMH, the chain’s first store would open by Christmas 2002, later than De Beers had originally estimated. Ralfe admitted that he was “unhappy” about the fact that the EC had opened a Stage II investigation of the De Beers-LVMH venture.
Considering that De Beers is now a private company and under no obligation to release such information, it’s remarkable that these figures were announced at all. Analysts took this as an encouraging sign that De Beers would fulfill its pledge not to “disappear under a veil of secrecy” now that it’s private.
“De Beers transparency—may it last forever,” exclaimed South Africa’s Business Day.