Wednesday, January 30, 2013

Sotheby’s Jewelry Sales Top $460M in 2012

Jewelry sales for Sotheby's in 2012 surged to a record $460.5 million. The auction house stated that revenue from its jewelry sales was propelled by the success of private collections, exceptional diamonds and gemstones and historical jewels with noble provenance.  Sotheby’s jewelry auctions worldwide achieved an average of 84 percent sold by lot. Seventy-two lots sold for more than $1 million, with six surpassing the $5 million mark.
One highlight for the year came from a record sale of various-owner jewels at Sotheby’s Geneva, where the total achieved $108.4 million in May. sothebys auction
In the Americas, Sotheby’s experienced its  highest single-day total for jewelry in December when its New York auction achieved $64.8 million. Sotheby’s annual total of $114.5 million in Hong Kong marked the company’s second-biggest year of jewelry and jadeite sales in Asia.
During the year, Sotheby's auctioned jewelry from the collections of Brooke Astor, Estée Lauder, Evelyn H. Lauder, Charles Wrightsman and others, along with  two rare ''white glove'' auctions for private collections from Suzanne Belperron in Geneva in May, and a collection from Michael Wellby in London in December.
Specific highlights of lots sold included a 10.48-carat, deep blue briolette diamond (pictured), purchased by Laurence Graff for $10,860,146 or $1,036,273 per carat, and it achieved a world record price for any briolette diamond at auction. As part of its noble jewels sale, Sotheby's sold the Beau Sancy diamond (pictured below), a 34.98-carat, modified pear, double rose-cut stone with a history dating back 400 years for $9,699,618. The diamond was passed down through the royal families of France, England, Prussia and the House of Orange.
Another highlight of the year came from a Cartier bracelet that set a new auction record for a conch pearl jewel. It was formerly in the personal collection of Queen Victoria Eugenia of Spain (1887 to 1969) – the grandmother of Juan Carlos, the present king – and this bracelet was one of the most important jewels created by Cartier in the inter-war period -- it sold for $3,461,146.diamond auctions

An important platinum, emerald and 22.84-carat emerald-cut diamond ring from the estate of Brooke Astor sold for $1,202,500, but a 6.54-carat, internally flawless pink diamond ring from the collection of Evelyn H. Lauder sold for $8,594,500 in New York.

Sotheby's Hong Kong realized $12,720,000 for a highly important  8.01-carat, fancy vivid blue diamond ring,  $5,100,000 for diamond necklace by Nirav Modi and $3,340,000 for a very important and rare 9.08-carat pigeon's blood Burmese ruby and diamond ring by Cartier.

Tuesday, January 29, 2013

AG&J Identifies Synthetics Melee Mixed with Natural Diamonds

New York-based gemological lab, AG&J, recently received a large batch of allegedly natural diamond melee, however,  testing revealed that more than 5 percent of the batch was synthetic diamonds.
The client who submitted the diamonds claims the lot was purchased from a well-known trade source, with whom he had a long-standing business relationship. He had no idea synthetics were mixed in the lot. synthetic melee
With permission from their client, AG&J reports that a batch consisting of 4,566 round, full-cut diamonds weighing a total of 56 carats, ranging in size from 0.7-2.5mm, color ranging from fancy intense to vivid yellow with some brownish modifier, and a clarity range from VS to SI, was submitted to the lab at the end of December 2012.
Using their proprietary melee testing system, which analyzes each individual diamond, and not just a sampling, AG&J identified 243-HPHT grown synthetic diamonds. The remaining batch was natural and untreated.
Dusan Simic, the CEO of AG&J, believed that the data collected points to all the synthetic diamonds coming from one source, created to purposefully commit fraud.
“It was surprising that only four of the 243 synthetic diamonds showed weak magnetic properties, which are the results of metallic inclusions,” said Simic. “In my opinion, this indicates that the synthetic stones were not mixed into the batch accidentally. Non-magnetic diamonds were chosen on purpose because checking for magnetism is one of the quick, low-tech ways to screen melee for synthetics.”
The recent findings confirm the necessity in checking melee diamonds for synthetics, treatments and imitations. Simic stated, “It is crucial to check every single stone within a batch. Random screening is not enough. If the end consumer is purchasing jewelry with synthetic diamonds, believing they are natural, then the trade has not done its due diligence in ensuring the proper identity of diamonds traded and sold. Both our ethical obligation and reputation is in question if diamond melee is not screened.”
The AG&J (Analytical Gemology & Jewelry) Laboratory specializes in the identification of diamonds and their treatments. Seasoned in research and development, the lab concentrates on finding new identification procedures and consulting in HPHT and APHT treatment and technology. Responding to the trade’s concern of rapidly growing occurrences of synthetic and treated diamonds mixed in natural batches, and in mounted jewelry, AG&J developed a system for batch testing melee accurately in a cost-effective way. The system is based on internationally accepted diamond identification methods, such as: Raman spectroscopy, absorbance measurement in the UV-VIS-NIR range, and FTIR and photoluminescence.
AG&J provides melee-testing services, starting at $2 per stone. To further address this growing issue, the lab is currently developing a system to identify stones mounted in jewelry. “We hope to have the first prototype of this system working by mid-2013,” said Simic.


Monday, January 28, 2013

Diamonds probe rattles Zanu PF

The ongoing probe into alleged diamond money looting in Manicaland has rattled Zanu PF with the party now barring members from seeking donations ahead of President Robert Mugabe’s birthday. Manicaland provincial chairperson Mike Madiro along with four other Zanu PF provincial officials are embroiled in a $750 000 diamond fraud case after they allegedly sourced cash from diamond mining firms and pocketed the money.
Manicaland provincial chairperson Mike Madiro along with four other provincial officials
Mugabe has already asked the police to investigate the matter.

With Mugabe’s birthday a few weeks away, the 21st Movement on Tuesday last week launched its fundraising campaign but has barred other party functionaries from collecting donations on behalf of the movement following the Manicaland debacle.

Annually Zanu PF youths are dispatched around the country to help raise funds for Mugabe’s bash, but the diamond probe has put a stop to the old custom amid fears that the party could be exposed even more, analysts have said.

Teachers in rural areas are often forced to make donations to Zanu PF members for occasions such as Mugabe’s birthday bash.

Absalom Sikhosana, Zanu PF’s secretary for youth says party activists are now barred from seeking donations on behalf of Zanu PF.

“We want to have it as tight as possible because we do not want to bring the name of the movement into disrepute.

“In order to instil confidence in the exercise, only those who have been identified will spearhead the fundraising. This year’s fundraising committee will be chaired by Comrade Johnson Masawi while each of the 10 provinces is expected to have one focal point coordinating the fundraising,” said Sikhosana.

Analysts say Zanu PF is rattled by the display of dirty linen in public and is now seeking to preen its image ahead of a watershed election.

They said if junior members in Manicaland can extort such huge amounts from companies, politburo members and cabinet ministers should be getting far much more.

“Not only is the party rattled by the revealing probe, but the collection of money is extortion because in the majority of cases Zanu PF activists will be intimidating companies.

Thursday, January 24, 2013

Three Global Suitors After Murowa Diamonds

AT least three global resources giants are said to have expressed interest in Rio Tinto Plc's multimillion dollar Zimbabwean gem extraction operation, Murowa Diamonds, after the world's third largest mining and exploration firm announced last year that it planned to offload the business.
Rio Tinto, which trades its stock on the London and Australian stock exchanges, controls 78 percent shareholding in Murowa, an asset that produces over 300 000 carats per annum, while the Zimbabwe Stock Exchange-listed RioZim Limited controls the remainder.
"Three companies have expressed interest in the mine," a source close to both Murowa and Rio Tinto said this week.

"One of the companies was here (recently), carrying out due diligence processes. Others are still working on that," the source said.
Murowa management had also expressed interest in purchasing shareholding in the diamond mining firm but it was not clear if they would be able to secure funding.
But given the demands of the country's tough empowerment laws, management was likely to be roped in by potential suitors.
Government has been championing controversial polices that have seen foreign investors releasing at least 51 percent shareholding in local companies to indigenous business people.
The empowerment programme reached its climax recently when Impala Platinum's Zimbabwean operating unit, Zimplats Holdings Limited, transferred controlling shareholding to locals.
Zimplats is the country's largest mining firm, which employs over 9 000 workers.
Rio Tinto had indicated that it planned to leave the diamond industry in March 2012, effectively inviting bids for its gem assets, including two other operations in Canada and Australia, worth about US$1,2 billion.
It was not possible to establish the names of the firms gunning for Murowa this week.
However, the sources said they were all global resources operations with significant financial muscle.
Over a week ago, one of the firms was scouring through Murowa's books but the outcome of the discussions was closely guarded.
This newspaper could not establish if RioZim, which said in May it was ready to exercise its pre-emptive rights in Murowa, was among the front runners.
RioZim, which was created in 2004 following the exit of Rio Tinto, had opened talks with Rio Tinto to take over the 78 percent.
However, RioZim has spent the better part of the past 12 months battling to clear a US$50 million debt owed to local banks, and it badly needs to recapitalise its gold mines and develop its substantial coal and chrome concessions.
RioZim was keen to exercise its pre-emptive rights to acquire Rio Tinto's shares in Murowa, Harpal Randhawa, whose private equity group Global Emerging Markets (GEM) recently bought 25 percent of RioZim, was quoted as saying in May last year.
"We are now in discussions with Rio Tinto Plc to acquire the 78 percent of Murowa that they want to offload," the GEM official was quoted saying at an investment conference in Harare.

Wednesday, January 23, 2013

Escom Mining to start mining diamonds in Angola soon

Escom Mining expects to start mining diamonds at the Luô concession and in the Tchegi region, following four years of prospecting, the chairman of the Angolan company, Hélder Bataglia said in Luanda according to state newspaper Jornal de Angola.
At the ceremony to celebrate the 32nd anniversary of Angolan state diamond company Empresa Nacional de Diamantes de Angola (Endiama), Bataglia said that production was expected to be good, but noted that the company preferred to wait for operations to be launched to go into details.
The chairman of Escom Mining said that conditions were in place to launch production and that appropriate staff and equipment were available.
Diamond prospecting was carried out over a five-year period and the company spent US$208 million on 14 concessions, which gave the company a clearer idea of the available reserves.
The company owns exploration rights on the 14 concession but, after prospecting at 12 of them, just two concessions were considered to be profitable. (

Tuesday, January 22, 2013

Zimbabwe Army Bartering Diamonds For Arms

Zimbabwe's Deputy Mines Minister has leveled serious accusations at the nation's armed forces, accusing it of colluding to trade the country's rough diamonds for weapons, Rough and Polished reports. Gift Chimanikire of the Movement for Democratic Change Party said that the nation was not earning as much as it should for its rough diamonds, because instead of being sold on the open market, they are being bartered for arms.

The diamond company doing the most mining activity in the Marange region, Anjin, is owned by China and the Zimbabwean Army in a 90%-10% split, and it is difficult to account for the dollar value of the army's share of the gems, since they are traded for weapons, according to Chimanikire. The Deputy Mines Minister said that as of 2 years ago, Anjin had amassed 5.8 million carats of rough diamonds that were not brought to tender in Harare.
Chimanikire recommended a change in the way diamonds were sorted in the country in order to quash corruption, according to Rough and Polished. The Deputy Minister criticized Zimbabwe's practice of sorting diamonds at the country's International Airport and advocated for the Zimbabwe Revenue Authority to audit transactions where the diamonds are produced to begin with.

Monday, January 21, 2013

Bharat Diamond Bourse Inaugurates Trading Floor

The Bharat Diamond Bourse (BDB) inaugurated its trading floor on Saturday, with an aim to widen the scope of trading within the complex and facilitate the operations of smaller companies and traders.

Anoop Mehta, the president of BDB, stated that over the past two years most of the larger diamond companies have relocated their operations to the bourse and several others are in the process of doing so. Currently, there are 425 offices of 300 companies operational within the premises, while work on the interiors of another 415 offices is nearing completion, he added.

“The opening of the SG Jhaveri Trading Hall will help accelerate this process of shifting the entire operations of the industry from the Opera House area to BKC,” Mehta said.

The trading hall is named after the late S.G. Jhaveri, who in the 1970s was one of the first to suggest setting up a diamond bourse in India and who worked toward that goal until his death in 1991. Union agriculture minister Sharad Pawar, who was instrumental in allocating the land on which the BDB occupies today, unveiled the statue of Jhaveri and inaugurated the trading floor.

“We are honoring a visionary and we are also celebrating a collective success in completing this complex and beginning of new chapter in our history,” Jhaveri’s son Kamlesh stated.

Pawar said that this facility would further boost the industry.

The BDB, located in the Bandra-Kurla Complex (BKC) in suburban Mumbai, occupies two million square feet of space and houses 2,500 diamond offices of various sizes. It offers facilities such as a trading hall, customs office, banking, restaurants, and security surveillance in the same complex.

“Our bourse is moving forward at a very important moment, and the massive manufacturing edifice that we have built up will be further strengthened by the development of this new trading infrastructure," Mehta noted.


Sunday, January 20, 2013

De Beers Confident Angola Search Will Reap Diamonds

De Beers said it’s confident of finding a gem deposit in Angola that will allow it to more than recoup the $250 million it has spent on exploration, Bloomberg reported.
The country is a “high priority” for De Beers, which has allocated a $30 million annual prospecting budget that’s unlikely to diminish soon, Pedro Lago de Carvalho, De Beers’s business manager in the country, said in a January 16 interview.
De Beers has found diamonds in a 3,000 square-kilometer concession near Lucapa in the Lunda North province. The site is the only remaining concession out of five De Beers has explored in the country since 2005, Lago de Carvalho said.
De Beers pulled out of Angola in 2001 after losing the right to sell more than $800 million of gems. It went through three arbitration rounds with Endiama EP, the state diamond company, before returning in 2005, said the Bloomberg report.
The results of evaluation studies of three ore bodies known as kimberlites at Mulepe, about 800 kilometers east of Luanda, are expected in about two months, and will be followed by meetings with Endiama to decide how to proceed, Lago de Carvalho said.
De Beers has a 49% share in the Mulepe concession, with Endiama holding the rest, according to an exploration deal signed before a new mining law enacted in late 2011.

Thursday, January 17, 2013

India's Polished Diamond Exports -37% in December

India’s polished diamond exports declined 37 percent year on year to $950 million in December 2012, the Gem & Jewellery Export Promotion Council (GJEPC) reported Thursday. By volume, polished exports fell 44 percent to 2.025 million carats during the month, while the average price ‎per carat jumped 14 percent to $469.12.

Imports of polished diamonds to India fell 49 percent to $581.24 million during December. Net polished exports, representing the excess of exports over imports, rose by 2 percent to $368.72 million.

Rough imports to India surged 35 percent to $1.762 billion during the month, while rough ‎exports fell 39 percent to $79.31 million. Net rough imports, representing rough imports less exports, increased 43 percent to $1.683 billion.

India’s December net diamond account, representing total exports less total imports, recorded a deficit of $1.314 billion, compared with a deficit of $817.34 million one year ago.

Polished Trade Slumps in 2012
For the calendar year, India’s polished exports declined 37 percent year on year to $16.986 billion with the average price of the polished exports up 15 percent to $504.94 per carat. Polished imports slumped 72 percent to $5.592 billion in 2012.

Weak demand from overseas markets and the import duty on polished diamond restrained the overall trade during the year. In January 2012, the government imposed a 2 percent tax on the import of cut and polished diamonds, after more than five years of duty free imports.

According to trade officials, the government’s move was aimed at curbing the widespread practice of round-tripping – whereby companies seek to boost turnover by the frequent import and export of the same diamonds in order to get additional bank financing – and the introduction of the import tax has helped curb round-tripping.

Rough imports rose 4 percent in 2012 to $14.986 billion, while rough exports declined by 10 percent to $1.525 billion during the year.

India’s 2012 net diamond account held a deficit of ‎‎$2.067 billion, however, this was much narrower than the deficit of $5.724 billion in the previous year.


Wednesday, January 16, 2013

Paragon Diamonds: Chairman Doyle's blue-print all about adding value

The arrival of Martin Doyle in September as deputy chairman of Paragon Diamonds (LON:PRG) was a fairly low key affair.

But the Scotsman’s vast industry experience – he is a 35-year veteran of De Beers - is already being put to good use quietly behind the scenes.
Having now taken on the role of chairman, the strategy he is helping to craft reflects this background.
It marries the processes you’d expect to find at the world’s largest diamond producer with the junior’s desire to add value at each stage of the exploration process.
It will also draw on experts in the field of micro-diamond analysis and resource modelling as Paragon assesses the huge, but as yet untapped potential of the Lemphane project in Lesotho.
This is a low-grade kimberlite that it is hoped will yield some very high value stones.
But the plan is also about turning the AIM-listed prospector into a multi-project play.
So Doyle’s blueprint will also draw on all the other assets in the Paragon portfolio, though there could be acquisitions to bolster the pipeline.
The company currently has the promising Kaplamp Lamproite project in Zambia which “can’t lie there doing nothing” as well as assets in Botswana and Tanzania.
To date the focus has been on Lemphane, where bulk sampling work is being carried out, and Motete, a dyke deposit 10 kilometres from the flagship project.
The most recent news flow has come from Motete, which has the potential for early cash flow.
While the samples taken so far from the dyke are encouraging, Doyle believes the company’s cash resources should be spent bringing potential company-maker Lemphane up to the same stage of development.
“There’s clearly higher-value, larger stones [at Motete] and the next step in the resource development process would be to increase that parcel size to 1,000 carats,” Doyle told Proactive Investors.
“However, this is going to cost quite a lot of money. So I think from a portfolio management viewpoint we have to get Lemphane up to a similar level of decision-making so we can take an informed decision on both projects.”
Near-term, the challenge will be bringing Lemphane along the exploration curve towards resource definition – and this will have its challenges.
That said it sits in a fairly prolific diamond region with the world-renowned Letšeng mine less than 30 kilometres away and the promising Liqhobong deposit almost on the doorstep.

At six hectares it is about the size of the satellite pipe at Letšeng, which means “the tonnage is there if we can get the [diamond] valuations”, says Doyle.
“But there are quite a few pitfalls along the way if you don’t get the sampling right,” the Paragon chairman adds.
“In Lemphane our expectation is the grade will be low. Our expectation also is there will be high value diamonds.
“We have had some initial indications that this is the case but nothing concrete.”
So the next year-and-a-half will be spent attempting to firm up this assertion.
Paragon is currently bulk sampling some 35,000 tonnes of ore taken from near surface to gain an idea of the potential grade and diamond quality of Lemphane.
However, Doyle is keen to know about the internal geology of the pipe – to discover whether the grade and diamond quality continues, and perhaps even improves, at depth.
This means drilling out samples from deep down in the kimberlite for microdiamond analysis.
In that endeavour Paragon can call on the expertise of Johan Ferreira, a leading light in this specialist area of resource estimation.
A team directed by Matthew Field of AMEC, another world renowned figure in his field, will be used to define the size and extent of the resource.
“This will give us a picture of the internal geology of the pipe.  It will also give us better certainty of its shape and depth and therefore its tonnage,” says Doyle.
A contractor will carry out an initial 2,000 metres of drilling although the group is hoping to acquire its own rig.
Paragon will also look to assess the liberation characteristics of the kimberlite in order to anticipate potential diamond recovery challenges before going into production.
The crucial juncture will come at some point next year when the group has to decide whether to take a bulk sample from lower down the kimberlite.
To establish the diamond value assortment could potentially be a large and quite expensive undertaking in a low grade kimberlite, although modern sampling and statistical techniques can reduce this.
“How to actually do this we have not decided at this point,” Doyle says.
Just to get to this resource definition stage is likely to cost US$4.5mln, and the bulk sample “at least as much again”, the Paragon chairman reveals.
An alternative might be a trial mining period as part of a planned lead-in to full scale production.
The company is still assessing how it will finance the work required just to get to resource definition at Lemphane.
But on funding Doyle is a pragmatist. “If you don’t have the money to execute the project properly, don’t even start,” he says.
“You might have three-quarters of the money. Still don’t start. You won’t have the answers people want.
“You want to put the portfolio together in a way that it is only advanced with properly informed decision making. That way there is no re-work or recycling.”
Meanwhile, defining a resource may actually prove to be an end in itself.
“We are a finder and developer. We don’t currently have the full team with experience of building and running [a large mine],” says Doyle, although that can obviously be changed.
“We have to determine what we want to be. And I think we want to be a resource developer. The real value creation for companies and shareholders comes at the early stage of development.”

Tuesday, January 15, 2013

Harry Winston to Use Swatch Cash for Diamonds

Harry Winston Diamond Corp. (HW)’s $1 billion sale of a luxury unit to Swatch Group AG (UHR) provides the cash to invest more in diamond mining, a business that last year was more than twice as profitable as jewelry.
Chairman and Chief Executive Officer Robert Gannicott said yesterday the Toronto-based company is interested in buying the 60 percent stake of the Diavik mine it doesn’t already own from Rio Tinto Group.
“The margins you can generate at the mining level are better than they’ve been achieving at the retail level,” said Edward Sterck, a London-based analyst at BMO Capital Markets. As minority shareholders in Diavik in northern Canada, “they have quite good visibility of the outlook and I guess that they view it as being something that potentially would be more profitable in the near to midterm.”
The sale of the luxury unit could make the company more attractive to investors looking for exposure to diamond mining, said Des Kilalea, an analyst at RBC Capital Markets in London.
“If you were a mining investor who was a bit irritated with the confusion of the luxury brand, this is something that would suit you,” Kilalea said yesterday by phone. “Suddenly you have a Canadian-focused diamond producer, and you don’t have a focused diamond producer at all in Canada at the moment.”
 Harry Winston to Use Swatch Cash for Diamonds

Expansion Plans

Harry Winston has been looking to expand its diamond assets after BHP Billiton Ltd. (BHP) and Rio Tinto, the world’s two biggest mining companies, announced they would consider getting out of the industry. Harry Winston agreed in November to buy BHP’s 80 percent stake in the Ekati mine in northern Canada as well as its global sales and sorting operations.
Buying Ekati would boost Harry Winston’s production to make it the fourth-biggest diamond miner by sales in 2013, up from seventh place, according to BMO forecasts. The company may rise to third place, behind industry leaders De Beers and OAO Alrosa, if it bought Rio Tinto’s Diavik stake, Sterck said.
Harry Winston rose 4.4 percent yesterday in Toronto, the most since November, after the deal was announced, bringing its gain in the past 12 months to 38 percent. The shares gained 0.9 percent to C$15:03 at 1:26 p.m. today.
The company reported sales of $290.1 million and operating profit of $48.7 million for its mining unit in the fiscal year ended Jan. 31, compared with $411.9 million and $19.4 million for the jewelry business.

‘Debt Free’

Harry Winston will sell its luxury retail unit to Swatch for $750 million and as much as $250 million in assumed debt, it said yesterday in a statement. The company, which renamed itself from Aber Diamond Corp. in 2007 after acquiring the luxury jewelry brand a year earlier, said it will be known as Dominion Diamond Corp. when the Swatch transaction closes.
The sale will enable it to complete the Ekati acquisition “debt free,” Gannicott, 65, said yesterday in a phone interview.
“It gives us headroom in our credit facility to do another transaction as well, so we are certainly going to be looking for other things to do,” Gannicott said. Rio’s stake in Diavik is “an obvious one for us to look at as long as the price is right.”
Rio said in March it would consider options for its diamond assets, which include its Diavik stake, the Argyle mine in Australia and 78 percent of Murowa in Zimbabwe, because the mines no longer fit its strategy. Harry Winston, which has a right of first refusal on Rio’s stake in Diavik, is less interested in the company’s Australian and African assets, Gannicott said.

Canada Focus

“We are more focused in the part of the world that we know best, which is northern Canada,” he said.
Harry Winston reported today that the Diavik mine plan under review for calendar 2013 forecasts production of about 6 million carats, which compares with 7.2 million last year.
Yesterday’s announcement probably makes Harry Winston a frontrunner to buy Rio’s stake in Diavik, said BMO’s Sterck.
It’s difficult to see who the other buyers would be, given that De Beers, a unit of London-based Anglo American Plc (AAL), “has got quite a few different pots on the boil at the moment,” while Mirny, Siberia-based Alrosa is probably more focused on investing in Russian assets, he said.

“It kind of ends up being Harry Winston or perhaps a surprise third party,” Sterck said.
Alrosa isn’t interested in buying Rio Tinto’s diamond assets, said Jane Kozenko, a spokeswoman for Russia’s diamond mining monopoly. Alrosa has studied Rio and BHP’s diamond assets and “found them not interesting” as the mines are near the end of their lives and extensions will be expensive and technically complicated, Kozenko said.

‘Under Pressure’

A London-based spokesman for Rio Tinto declined to comment yesterday on Gannicott’s statements. David Prager, a De Beers spokesman, declined to comment today on whether the company would consider new acquisitions in Canada.
Harry Winston’s renewed focus on mining may position it as an alternative to De Beers for diamond explorers seeking partners, said John Kaiser, owner of Kaiser Research Online, a Moraga, California-based mining information service.
Mountain Province Diamonds Inc. (MPV)’s 49 percent stake in the Gahcho Kue diamond project in Canada’s Northwest Territories may be of interest to Harry Winston, Kaiser said. De Beers operates the mining development.
“Harry Winston will now be under pressure to replace its depleting diamond resource,” Kaiser said yesterday by telephone. “It can no longer just rely on, well, ’when we run out of diamonds we can still be Harry Winston the jewelry retailer.’”

‘Nothing Else’

Mountain Province will evaluate any proposals from third parties “on their merit” and decide whether they are in the interest of shareholders, Patrick Evans, CEO of the Toronto- based company, said by phone today.
“If Harry Winston or, as it’s going to be called, Dominion Diamonds, decides once it’s closed its transaction with Swatch that it does want to make a proposal to us, we would be happy to consider it once the value of our asset has been fully defined, which we expect will be in the course of the next six months,” he said.
Harry Winston is prepared to look at other acquisition opportunities, Gannicott said.
“There’s nothing else that is actually looking for a buyer at the moment,” he said yesterday. “But we’d always be interested in other things where we have got the relevant skill set.”
Rough diamond prices fell 16 percent last year after three consecutive annual gains, according to an index from data provider, as purchases were delayed because of high inventory levels and a lack of available credit.

‘Discrete Investment’

Prices are still “relatively elevated” on a historical basis and will probably rise over the rest of the decade, Sterck said.
While demand for diamonds in Europe remains “a little bit shaky,” key markets including the U.S. and Japan remain stable and consumption is rising in emerging markets, especially China and India, Sterck said.
The sale of Harry Winston’s jewelry unit makes sense given that the company got a “pretty good price,” RBC’s Kilalea said.
“You’ve got two so totally discrete investment universes that it was hard always to see the correct value coming through in the share,” Kilalea said. “Ultimately a split in the company I think was inevitable.”
To contact the reporters on this story: Liezel Hill in Toronto at; Christopher Donville in Vancouver at
To contact the editors responsible for this story: Simon Casey at; David Scanlan at

Monday, January 14, 2013

2013 Golden Globes red carpet jewelry

2013 Golden Globes: Best jewelry

Jessica Alba was one of the luckiest — and probably most well-guarded — starlets at the 2013 Golden Globes, thanks to her $5.8 million diamond necklace Mrs. Winston by Harry Winston necklace. (It more than made up for her orange feathered clutcj; so that's what happened to the Lorax.)

Statement earrings were a big trend of the night, with enormous bejeweled drops sported by Jennifer Lopez, Debra Messing, Megan Fox and Alyssa Milano.
 2013 Golden Globes: Best jewelry
Other favorites from the evening: Connie Britton's wristful of Lorraine Schwarz diamond-encased bangles, Nicole Kidman's antique blue enamel and gold snake bangle from Fred Leighton, and Julianne Moore's Bulgari diamond chandelier earrings in yellow gold.

Not everyone reached for the glitter: Zooey Deschanel accented her retro-style Oscar de la Renta gown with an oversized Kwiat pearl necklace and bracelet.

Sunday, January 13, 2013


Rockwell Diamonds reported increased revenues from diamond sales for the fourth consecutive quarter in the third quarter of fiscal 2013.

The miner, which has several operations in South Africa, recorded diamond sales of US$7.4 million, up 23 percent from the third quarter of the previous year.
Including beneficiation revenues of US$1.6 million in the third quarter, the company reported total revenue of US$8.8 million.
The miner said that beneficiation revenues recovered well after a slow second quarter that had been characterized by particularly slow trading in the northern hemisphere summer.
The firm says it has carried over an inventory of 2,704 carats into the fourth quarter to "take advantage of any possible restocking trend".
It adds that the beneficiation pipeline, comprising some 5,500 carats "provides further potential for valued added downstream revenues".
Total cash costs increased 37 percent from the second quarter to US$9.6 million. This led the company to optimize Klipdam, including the introduction of a contract miner at a fixed unit cost, and to place the operations of Tirisano on care and maintenance after the management team had explored all possible avenues to operate the mine profitably using the existing infrastructure.
The firm reported a 10-percent rise in sales volume from the Saxendrift operation to 1,931 carats at a significantly improved average price of US$3,082 per carat versus US$1,892 per carat a year ago.
Of significant benefit was the sale of a 145-carat rough diamond recovered from old Saxendrift recovery tailings which sale increased the average price per carat from the Bulk X-ray plant to US$10,704.
Carats sold from Klipdam declined 25 percent for the quarter to 1,490 carats with a slightly lower average value of US$660 per carat.
The grade was down 25 percent on the quarter as mining moved out of the high-grade portion of the channel.
Diamond sales from Tirisano totaled 214 carats, significantly under budget.
Looking Forward
The company said it is optimistic that with improving diamond prices since the beginning of November 2012 after prices declined by 15-20 percent in the first half of the 2012 calendar year, the market is positioned to increase by a few percent in 2013.
"This view is supported by good interest at the Hong Kong show in November 2012 and increased attendance at open market tenders," the firm says in a statement. "Reflecting this trend, Rockwell also experienced higher attendance at its closing tenders for 2012 supporting higher prices and providing some evidence of a more stable market than in previous years."
The company started the fourth quarter with 2,704 carats in inventory, positioning it to take advantage of any possible restocking trend. In addition, inventory in the beneficiation joint venture with Steinmetz Diamond Group of more than 5,500 carats, creates upside potential for further value-added revenue for Rockwell.
The miner has developed a blueprint for the construction of new processing plants at its high potential projects in the Middle Orange River region, based on the success of the fit-for-purpose technologies, including the in-field screen, Bulk X-ray and single particle sorter plant implemented at Saxendrift.
Initiatives to increase and extend the mine life of Rockwell's Middle Orange River properties include the construction of a new mine at the Saxendrift Hill complex, utilizing Bulk X-ray technology with a monthly processing capability of 100,000 m3 and the pre-feasibility study for Wouterspan is progressing on schedule.
Possible developments during calendar 2013 include installing an in-field screen at the Saxendrift Extension project and assessing the development of a mine similar to the Saxendrift Hill complex at the company's Niewejaarskraal project.

Thursday, January 10, 2013

Tiffany's Christmas-Season Comps Flat, Revenue +4%

Tiffany & Co. reported that worldwide sales increased 4 percent year on year to $992 million for the Christmas season, which included the months of November and December 2012. However, comparable-store sales were flat.
Sales in the Americas region rose 3 percent year on year to $516 million and on constant-exchange-rate basis sales increased 2 percent. Tiffany recorded a comparable-store sales decline of 2 percent for its New York flagship store and in branch stores. Internet and catalog sales rose 4 percent.
In the Asia-Pacific region, revenue increased 13 percent to $187 million and comparable-store sales jumped 7 percent, both increases were due to growth in Greater China. In Japan, total sales plunged 5 percent to $153 million, but same-store sales rose 1 percent. tiffany results
Tiffany stores in Europe experienced a 2 percent increase in revenue at $119 million, however results were mixed by country and same-store sales were flat.
Revenue from other regions, increased 114 percent to $17 million, largely reflecting the conversion in July of five Tiffany & Co. stores in the United Arab Emirates from independently-operated distribution to company-operated retail stores.
Michael J. Kowalski, the chairman of Tiffany & Co., acknowledged that Christmas-season sales were at the ''low end'' of guidance and therefore Tiffany expects net earnings for the year ending on January 31 to be at the lower-end of the forecast in the range of $3.20 to $3.40 per diluted share.
''Looking forward, we are formulating plans for continued store expansion and new product introductions in 2013,'' Kowalski added. ''We will provide detailed financial guidance when we report our full year results in March but, due to uncertainty about general economic conditions in all our major markets, management is planning sales growth conservatively for 2013 and at this point expects net earnings growth of 6 percent to 9 percent.''
The Zale Corporation stated this morning that its Christmas-season same-store sales rose 2.3 percent year on year, while total revenue was flat at $567 million.

Zales branded stores, consisting of Zales Jewelers and Zales Outlet, posted a same-store sales increase of 3.1 percent year on year, while Gordon's Jewelers  posted a comparable-store sales increase of 2.2 percent. Canada's fine jewelry brands, consisting of Peoples Jewellers and Mappins Jewellers, posted a comparable-store sales increase of 2.7 percent. Same-store sales at Piercing Pagoda rose 1.7 percent.
Zale's guidance for the second-fiscal quarter suggested gross margin to remain the same from one year ago at  50.5 percent with operating margin up approximately 7.5 percent, or 100 basis points higher than one year ago as a result of improved leverage on selling, general and administrative expenses.

For the fiscal year, Zale expects to achieve a profit, according to its statement.

"This Christmas season, we focused on driving bottom line improvement," said Theo Killion, Zale's chief executive. "Our comp performance, combined with an expected 100 basis point operating margin improvement, brings us closer to our goal of achieving positive net income for the fiscal year."