Namakwa Diamonds Increases Loss for FY11

Namakwa Diamonds reported a net loss of $76.7 million in the fiscal year that ended on August 31, 2011, compared with a loss of $30.5 million one year earlier. The greater loss was the result of refocusing development on the Kao mine in Lesotho . Revenues rose 14 percent to $93.3 million while cost of sales rose 19 percent to $95.2 million and expenses more than doubled to $44.5 million.
”Our prime focus for the current financial year is to ramp up the development of the Kao project into steady-state phase 1 production,” said Richard Collocott, Namakwa’s chief executive. ”Our goal is to deliver value, reduce costs and conserve cash to enable Kao to become the world class asset that we believe it to be.”

The company expects to commission phase 1 mining at Kao in November and is hoping that output from the mine will reach 200,000 carats in fiscal 2012.

Group production for the past year rose 55 percent to 128,191 carats with output at its alluvial miens in the Democratic Republic of the Congo (DRC) up 94 percent to 77,872 carats while its South Africa production fell 1 percent to 38,092 carats. Additional production came from provisional mining at Kao.

During the year, Namakwa suspended third party trading and closed all its diamond trading joint ventures. The trading division was restructured to act as a marketing and distribution platform for the sale of its mined rough production.

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