Revenue Decline#
Gem Diamonds has reported a 36% drop in revenue for the year 2025, totaling $98.4 million. This decline is attributed to ongoing weakness in the prices of rough diamonds, which are uncut and unpolished stones, along with low demand in the market.
Financial Losses#
The company experienced a net loss of $63.4 million, translating to a loss of $0.68 per share. Additionally, it reported a pretax loss of $81 million, while its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at $3.9 million. Adjusted EBITDA is a measure of a company's overall financial performance, excluding certain expenses.
Factors Behind the Decline#
The revenue drop was influenced by a combination of factors, including high inventory levels and macroeconomic challenges. The company noted that the decline was driven by fewer diamonds being sold and a higher proportion of lower-quality stones from its Main Pipe ore, which is a type of diamond-bearing rock. This resulted in fewer large, high-value diamonds being available for sale.
Future Outlook#
In response to these challenges, Gem Diamonds initiated a Business Resilience Programme in the second half of 2025 aimed at reducing costs and conserving cash. While this program, along with some royalty relief, helped mitigate the revenue decline, the company anticipates continued weakness in the diamond market throughout 2026. Gem Diamonds is also working to renew its group credit facilities before they expire in December 2026, positioning itself for potential recovery when market conditions improve.