Gem Diamonds Limited (LSE: GEMD) ('Gem Diamonds' or the 'Company' or the 'Group') provides the following Trading Update detailing the Group's operational and sales performance from 1 January 2020 to 30 June 2020 ('H1 2020' or the 'Period').

Highlights

The Group reduced its net debt position by US$4.6 million to US$5.5 million (H2 2019: US$10.1 million).

Average price for the Period was US$1 707 per carat (H2 2019: US$1 576 per carat).

16 diamonds sold for more than US$1.0 million each, generating revenue of US$29.4 million during the Period (H2 2019: 12 diamonds sold for more than US$1.0 million each, generating US$26.6 million of revenue).

LetSeng returned to its standard treatment capacity during Q2 2020 after temporarily suspending operations for 30 days in line with the Lesotho Government's regulations to curb the spread of the Covid-19 virus.

The smaller sized diamonds from the June tender have been carried over and will be sold in September. The average dollar per carat for H1 2020 includes an estimated value of these diamonds.

Covid-19

In compliance with the Lesotho Government's lockdown order, LetSeng temporarily suspended operations between 28 March and 26 April 2020 (the lockdown period) and placed the mine on care and maintenance.

The Group has implemented a wide range of precautions to protect its employees and contractors, based upon expert advice. These Covid-19 health and safety measures include thermal screening, X-ray screening, Polymerase Chain Reaction (PCR) screening, promotion of sanitation measures, appropriate social distancing, compulsory wearing of face masks and the provision of Personal Protective Equipment.

To date, LetSeng's advanced screening protocol has resulted in 74 suspected Covid-19 cases. As part of the Covid management strategy, all suspected cases have been safely transferred to their respective residences for self-quarantining and thus no suspected positive cases remain on mine site. Sadly, two employees have subsequently passed away whilst in quarantine, but these have yet to be confirmed by the National Health Authority as Covid-19 related deaths.

LetSeng continues to provide support to its workforce and surrounding communities and assistance to the Government in its efforts to curb the spread of the virus in Lesotho.

There has been one positive case reported from the Gem Diamonds office in Johannesburg and this employee has fully recovered.

In addition to the two successful tenders held in Q1 2020, a third tender was successfully concluded in Antwerp during June 2020, in strict compliance with Covid-19 health and safety protocols.

The full impact of the Covid-19 pandemic on LetSeng's operations and production outlook for 2020 remains uncertain. Revised guidance will be released when the Company has greater clarity on the market environment.

Gem Diamonds' CEO, Clifford Elphick, commented: 'The positive sales results during the Period demonstrate the continued demand for LetSeng's high quality diamonds with an average price of US$1 707 per carat, despite the challenging global conditions. This, together with the pro-active cost control and cash preservation measures implemented across the Group, has resulted in positive cash flow generation during the Period.

We are also pleased that LetSeng has quickly returned to its standard treatment capacity post the lockdown period, as well as ramping up waste mining activities from July.

Gem Diamonds continues to ensure that the Group's safety protocols relating to Covid-19 are strictly adhered to and that appropriate support is provided to employees.''

Contact:

Ollie Mills

Tel: +44 (0) 208 434 2643

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.

ABOUT GEM DIAMONDS

Gem Diamonds is a leading global diamond producer of high value diamonds. The Company owns 70% of the LetSeng mine in Lesotho and is currently in the process of selling its 100% share of the Ghaghoo mine in Botswana. The LetSeng mine is famous for the production of large, exceptional white diamonds, making it the highest dollar per carat kimberlite diamond mine in the world.

(C) 2020 Electronic News Publishing, source ENP Newswire