Firestone Diamonds smashes expectations with first sale
Fledgling diamond miner Firestone has promised more riches are in store after beating expectations for its first ever sale of gemstones from Lesotho.
Aim-listed Firestone, which specialises in rare yellow diamonds from the landlocked southern African country, raised $8.14m (£6.5m) at a sales tender in Antwerp last week.
The miner began production last October, and will pursue an “aggressive” six-month ramp-up, according to chief executive Mr Brown, moving into higher-quality ore that should mean even bigger diamonds.
Despite deliberately targeting lower-grade rocks for its first production run, Firestone still turned up one diamond that sold for more than $1m in its first tender.
The sales process attracted 90 bidders, with 38 making purchases.
Firestone Diamonds’ plant in Lesotho
Mr Brown said his management team’s experience in the industry helped it deliver an “outstanding result” in its first tender. “We understand the market, we know who to sell to and who to speak to, and we ignore all the noise and hype,” he said.
After a tough couple of years, the diamond market is showing signs of growth, with industry leader De Beers recently reporting strong sales numbers.
Mr Brown - a former De Beers chief executive and CFO, who took the helm of Firestone in 2013 and steered it through a refinancing - said the diamond market had enjoyed “a better start to 2017 than we could have hoped for”.
Firestone is 25pc owned by the Lesotho government, which has been trying to capitalise on the country’s natural diamond wealth. It is home to the world’s most valuable diamond mine on a price per-carat basis - the Letseng mine, run by London-listed Gem Diamonds.
Analysts at Peel Hunt said: “The first sale of white and yellow goods from the new Liqhobong mine can be viewed as a success with all of the 75,936 carats that were offered for sale being sold.“
Mirabaud analysts added: “We view this initial sale as very strong, and well ahead (by 20-30pc) of our expectations at this point. In particular we are highly encouraged to see the presence of a $1m stone so early in the project’s life.”
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