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RAPAPORT... Rockwell Diamonds Inc. reported that production rose 2.6 percent year on year to 6,932 carats in the fourth quarter that ended on February 28. Revenue increased 7.8 percent to $13.1 million as the average price for goods sold jumped 22.2 percent to $1,544 per carat.
Carat production at the company's Middle Orange River operations rose 13 percent due to a higher volume of processed ore; however, carat recovery was lower. Diamond sales from this operation, excluding beneficiation, rose 24 percent year on year to $10.6 million, underpinned by the sale of 135.70-carat and 121.60-carat diamonds. Rockwell carried over rough inventory of 1,196 carats, including royalty contract miners' inventory of 693 carats, at the close of its fiscal year.
During the fiscal year that closed on February 28, Rockwell Diamonds sold $50.8 million worth of goods at an average price of $1,345 per carat, compared with revenue of $45.2 million and an average price of $1,484 per carat in the previous fiscal year.
James Campbell, the CEO of Rockwell, said, "Our Saxendrift operation performed to plan and delivered another increase in volume processed, helping to offset the impact of the lower grades. Carat production at Saxendrift increased 9 percent compared with fourth-quarter 2014 and included two high-value plus-120-carat diamonds. Saxendrift recorded a 43 percent improvement in diamond sales to $8.7 million. Although the volume of gravel processed at Niewejaarskraal increased 57 percent, with a 141 percent improvement in carat production, the grade remained below plan and subeconomic at current rates of plant throughput.
"We addressed this in the short term through transitioning mining to higher-grade Rooikoppie gravels toward the end of the quarter. We are reviewing our options with the focus on increasing the throughput rates. This will entail suspension of production while we undertake planning to refine our understanding of the orebody and, at the same time, expand the processing capacity to 180,000 cubic meters per month. Overall production will be impacted in the short term as a consequence, but the financial impact will be limited as Niewejaarskraal is currently incurring operating losses," he explained.
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