VANCOUVER, Sept. 26, 2011 /CNW/ - Rockwell Diamonds Inc ("Rockwell" or
the "Company") (TSX: RDI; JSE: RDI; OTCBB: RDIAF) announces the results
of second quarter sales of its diamond production from South African
Total proceeds of $7.0 million were generated from the sale of 3,223
carats. The average price per carat for the quarter was USD $2,187,
demonstrating the high quality of stones sold.
US $ Revenue
Recovery and beneficiation of notable stones:
Production across the Company's operations, which was disappointing in
June and July 2011, recovered strongly in August 2011. In particular,
373 carats were recovered at Rockwell's Saxendrift mine on August 2,
2011 which was a daily record at the mine. Large stones produced by
each of the operations during the second quarter are as follows:
Klipdam produced 14 stones exceeding 10 carats; and
Saxendrift produced 32 stones weighing more than 10 carats, of which 11
stones exceeded 20 carats
These stones have been passed into the Company's beneficiation joint
venture with the Steinmetz Diamond Group which delivers value added
revenues for Rockwell's stones that exceed 2.8 carats.
During the quarter the high quality stones sold through the
beneficiation joint venture with Steinmetz Diamond Group, included the
a 128.67 carat perfect sawable; fancy yellow with high clarity stone;
a 21.52 carat gem quality; clean D/E color stone;
a 33.51 carat octahedral, clean, H/I colored stone; and
a 179.95 carat makeable, clean brown colored stone.
Further details pertaining to the beneficiation revenues will be
disclosed with the second quarter earnings announcement which will be
made on or about October 17, 2011.
Rough Diamond Market:
Although prices remain strong overall, the diamond market has been
impacted by uncertainty in the financial markets in the second quarter
of fiscal 2012. During June and July 2011, prices for both rough and
polished diamonds increased, as higher pricing in the downstream
industry was led by speculative activity. Producers followed suite,
with rough prices achieving all time record levels at the end of July
2011, leading into the summer vacation period. Polished prices
continued to rise, but the pace remains slower than for rough diamonds,
resulting in the continued disconnect between the cost of rough
diamonds and polished prices.
As global financial markets corrected in August 2011, diamond traders
were left holding expensive inventory in uncertain markets. By the end
of August, prices had corrected but are expected to stabilize following
the Hong Kong diamond show and the next De Beers sight later this
Commenting on the latest diamond sales, James Campbell, CEO, Rockwell
"We are pleased that the high quality of our current production has
supported higher selling prices. While the underlying diamond market
has increased by some 25% per carat for diamonds such as those
typically produced by Rockwell in the past twelve months, our average
price for the quarter has more than doubled. This is a clear
demonstration that the diamonds which we have presented for sale are of
a superior quality and in high demand."
"At the end of August, Rockwell focused its sales on larger diamonds
through our beneficiation JV which benefits from Steinmetz's ability to
manufacture to achieve value of polished product. We had been
anticipating the short term price consolidation that has occurred in
August 2011. Our products were not sold at a discount to drive sales."
"We produced 46 stones exceeding 10 carats from our two operational
mines, which included 11 rough stones weighing more than 20 carats.
This is an indication that our diamond value management focus, which
prioritizes the production of quality tons, is starting to pay off."
About Rockwell Diamonds:
Rockwell is engaged in the business of operating and developing alluvial
diamond deposits, with a goal to become a mid-tier diamond mining
company. The Company has three existing operations, which it is
progressively optimizing, two development projects and a pipeline of
earlier stage properties with future development potential. Rockwell is
also at an advanced stage of completing the acquisition of the Tirisano
Rockwell also evaluates merger and acquisition opportunities which have
the potential to expand its mineral resources and production profile
and would provide accretive value to the Company.
No regulatory authority has approved or disapproved the information
contained in this news release.
Forward Looking Statements
Except for statements of historical fact, this news release contains
certain "forward-looking information" within the meaning of applicable
securities law. Forward-looking information is frequently characterized
by words such as "plan", "expect", "project", "intend", "believe",
"anticipate", "estimate" and other similar words, or statements that
certain events or conditions "may" or "will" occur. Although the
Company believes the expectations expressed in such forward-looking
statements are based on reasonable assumptions, such statements are not
guarantees of future performance and actual results or developments may
differ materially from those in the forward-looking statements.
Factors that could cause actual results to differ materially from those
in forward-looking statements include uncertainties and costs related
to exploration and development activities, such as those related to
determining whether mineral resources exist on a property;
uncertainties related to expected production rates, timing of
production and cash and total costs of production and milling;
uncertainties related to the ability to obtain necessary licenses,
permits, electricity, surface rights and title for development
projects; operating and technical difficulties in connection with
mining development activities; uncertainties related to the accuracy of
our mineral resource estimates and our estimates of future production
and future cash and total costs of production and diminishing
quantities or grades if mineral resources; uncertainties related to
unexpected judicial or regulatory procedures or changes in, and the
effects of, the laws, regulations and government policies affecting our
mining operations; changes in general economic conditions, the
financial markets and the demand and market price for mineral
commodities such and diesel fuel, steel, concrete, electricity, and
other forms of energy, mining equipment, and fluctuations in exchange
rates, particularly with respect to the value of the US dollar,
Canadian dollar and South African Rand; changes in accounting policies
and methods that we use to report our financial condition, including
uncertainties associated with critical accounting assumptions and
estimates; environmental issues and liabilities associated with mining
and processing; geopolitical uncertainty and political and economic
instability in countries in which we operate; and labour strikes, work
stoppages, or other interruptions to, or difficulties in, the
employment of labour in markets in which we operate our mines, or
environmental hazards, industrial accidents or other events or
occurrences, including third party interference that interrupt
operation of our mines or development projects.
For further information on Rockwell, Investors should review Rockwell's
annual Form 20-F filing with the United States Securities and Exchange
Commission www.sec.com and the Company's home jurisdiction filings that are available at www.sedar.com.
SOURCE Rockwell Diamonds Inc.
For further information:
For further information on Rockwell and its operations in South Africa, please contact
| James Campbell || || || CEO || || || +27 (0)83 457 3724 |
| Stéphanie Leclercq || || || Investor Relations || || || +27 (0)83 307 7587 |