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Financial and operational metrics⁽¹⁾

	Production volume	Sales volume	Price	Unit cost*	Group revenue*	Underlying EBITDA*	EBITDA margin*(6)	Underlying EBIT*	Capex*	ROCE*
	’000 cts	’000 cts(2)	$/ct(3)	$/ct(4)	$m(5)	$m		$m	$m
De Beers	32,276	33,357	146	58	5,602	1,100	47 %	620	565	7 %
Prior year	25,102	21,380	133	57	3,378	417	54 %	0	381	0 %
Botswana	22,326	n/a	152	32	n/a	464	n/a	407	72	n/a
Prior year	16,559	—	124	35	—	225	—	178	66	—
Namibia	1,467	n/a	565	359	n/a	101	n/a	68	91	n/a
Prior year	1,448	—	492	272	—	113	—	82	77	—
South Africa	5,306	n/a	113	45	n/a	241	n/a	82	309	n/a
Prior year	3,771	—	99	53	—	165	—	16	147	—
Canada	3,177	n/a	62	44	n/a	68	n/a	4	42	n/a
Prior year	3,324	—	58	36	—	92	—	40	31	—
Trading	n/a	n/a	n/a	n/a	n/a	515	11 %	505	4	n/a
Prior year	—	—	—	—	—	80	3 %	74	3	—
Other(7)	n/a	n/a	n/a	n/a	n/a	(289)	n/a	(446)	47	n/a
Prior year	—	—	—	—	—	(258)	—	(390)	57	—

⁽¹⁾ Prepared on a consolidated accounting basis, except for production, which is stated on a 100% basis except for the Gahcho Kué joint operation in Canada, which is on an attributable 51% basis.

⁽²⁾ Total sales volumes on a 100% basis were 36.3 million carats (2020: 22.7 million carats). Total sales volumes (100%) include De Beers Group’s joint arrangement partners’ 50% proportionate share of sales to entities outside De Beers Group from Diamond Trading Company Botswana and Namibia Diamond Trading Company.

⁽³⁾ Pricing for the mining business units is based on 100% selling value post-aggregation of goods. Realised price includes the price impact of the sale of non-equity product and, as a result, is not directly comparable to the unit cost.

⁽⁴⁾ Unit cost is based on consolidated production and operating costs, excluding depreciation and operating special items, divided by carats recovered.

⁽⁵⁾ Includes rough diamond sales of $4.9 billion (2020: $2.8 billion).

⁽⁶⁾ Total De Beers EBITDA margin shows mining EBITDA margin on an equity basis, which excludes the impact of non-mining activities, third‑party sales, purchases, trading downstream and corporate.

⁽⁷⁾ Other includes Element Six, Brands and consumer markets, acquisition accounting adjustments and corporate.

Markets

The diamond industry continued to recover from the impacts of the Covid-19 pandemic during 2021. In the first half of the year, consumer sales of diamond jewellery in the US and mainland China posted positive growth not only on the Covid-19 affected sales in 2020, but also in comparison to 2019 before the onset of the pandemic. Other global consumer markets initially saw a less pronounced rebound due to the uneven timing of pandemic impacts across the world, but the second half of 2021 saw a more positive recovery trend across the entire international diamond value chain.

The ongoing increase in consumer demand led to strong growth rates in consumer sales of diamond jewellery in the US, with holiday season sales increasing by about a third compared to 2020. The strength of demand was the result of an accumulation of savings by US consumers through the various lockdowns and restrictions on movement seen earlier in the pandemic; a pent-up demand for weddings and engagements; a strong desire for diamonds as meaningful gifts that symbolise personal connection; less luxury travel; and supported by ongoing marketing campaigns (including an increase in marketing effectiveness from De Beers).

The positive demand trends in retail underpinned the increased demand for polished diamonds and as a result, stocks of polished diamonds in cutting centres steadily declined during the course of the year. Lower supply and steady demand for polished diamonds from retailers supported growth in polished diamond prices.

As downstream and midstream demand conditions continued to improve, rough diamond production and prices increased throughout the year, following the significant reductions seen at the start of the pandemic. Midstream sentiment and rough diamond demand were robust throughout 2021.

Financial and operational overview

Total revenue increased significantly to $5.6 billion⁽¹⁾ (2020: $3.4 billion), with rough diamond sales rising to $4.9 billion⁽¹⁾ (2020: $2.8 billion), driven by positive sentiment and strong demand for diamond jewellery in key consumer markets. With midstream capacity recovering, despite the second wave of Covid-19 infections in India in the second quarter of 2021, on a consolidated basis, rough diamond sales volumes were significantly higher at 33.4 million carats (2020: 21.4 million carats). The average realised price rose by 10% to $146/ct (2020: $133/ct), primarily as a result of positive market sentiment which gave rise to an 11% strengthening of the average rough price index. Revenue also increased within De Beers’ other businesses, including Element Six.

Underlying EBITDA increased to $1,100 million (2020: $417 million), reflecting the improvement in sales driven by the recovery in demand. Unit costs were broadly flat at $58/ct (2020: $57/ct), as the benefit of higher production volumes was offset by an increase in input costs and unfavourable exchange rates.

Capital expenditure increased by 48% to $565 million (2020: $381 million), as spend returned to more normalised levels following the deferral of sustaining projects during 2020 in response to Covid-19. The execution of Venetia Underground (in South Africa) and Jwaneng Cut-9 (in Botswana) life extension projects continued to progress, and the mine life extension of the Namibian land operations was approved during the year. The new AMV3 vessel for Namibia, now named the Benguela Gem (the largest and most advanced diamond recovery vessel ever built), arrived in Cape Town in September 2021 to complete preparations for its commissioning in the first quarter of 2022.

⁽¹⁾ Total revenue and rough diamond sales for 2019 were $4.6 billion and $4.0 billion respectively.

Operational performance

Mining and manufacturing

Rough diamond production increased by 29% to 32.3 million carats (2020: 25.1 million carats) primarily due to the lower levels of production in 2020 as a result of the impact of Covid-19 related lockdowns and lower demand due to the pandemic. Despite the operational issues and heavy rains in southern Africa in the first quarter of 2021, production was increased to meet the stronger demand for rough diamonds.

In Botswana, production was 35% higher at 22.3 million carats (2020: 16.6 million carats) as production was increased in response to stronger prevailing demand. Production at Jwaneng increased by 71% to 12.9 million carats (2020: 7.5 million carats) due to the planned treatment of higher grade ore, and as a result of Covid-19 related lockdowns in the previous year. Production at Orapa increased marginally by 5% to 9.4 million carats (2020: 9.0 million carats), despite the impact of heavy rainfall at the beginning of the year and the planned closure of Plant 1 in late 2020.

In Namibia, production was broadly in line at 1.5 million carats (2020: 1.4 million carats), reflecting an increase from the remobilisation of most vessels in late 2020, partly offset by planned maintenance.

In South Africa, production increased by 41% to 5.3 million carats (2020: 3.8 million carats), owing to the impact of the Covid-19 lockdowns in the first half of 2020 and the planned processing of higher grade ore from the final cut of the Venetia open pit.

In Canada, production was marginally lower at 3.2 million carats (2020: 3.3 million carats), mainly due to a temporary Covid-19 related shutdown in the first quarter of 2021.

Brands and consumer markets

2021 saw a strong recovery in consumer demand for De Beers’ branded diamond jewellery from De Beers Jewellers and De Beers Forevermark, with both achieving double digit retail growth year-on-year. De Beers also continued to expand its retail stores in 2021, including its new flagship store in Old Bond Street, London and new stores in China and Qatar.

In August 2021, De Beers Group announced its new ‘One De Beers’ approach and its focus on establishing De Beers as a ‘purpose-led’ brand. De Beers has now launched its new brand campaign built around a widening interpretation of the phrase ‘I do’, itself the embodiment of one of the most time-honoured expressions of intent and values.

Expectations for retail restocking in early 2022 are encouraging following the strong retail sales of diamond jewellery over the holiday season. The growth in consumer demand for diamond jewellery is expected to continue, driven by the US, primarily due to continued economic recovery, higher accumulated savings and postponed marriages. Rough diamond demand is expected to remain steady as the midstream continues to operate with lower stock levels, manufacturing below full capacity but using a faster manufacturing cycle. While there continue to be risks relating to the effects of Covid-19 across the pipeline, geo-political uncertainty and cost inflation pressures, sentiment in the midstream is expected to remain positive on the back of anticipated strong US retailer restocking in the first quarter.

The longer term evolution of the diamond value chain continues, including a sustained focus on inventory balance, the efficient distribution of diamonds throughout the pipeline, increased online purchasing, and a greater focus on the provenance and sustainability credentials of companies and their products. De Beers is well positioned to take advantage of these changes. The long term outlook for diamond jewellery demand remains positive.

Production guidance for 2022 is 30–33 million carats (100% basis), subject to trading conditions and the extent of further Covid-19 related disruptions. Unit cost guidance for 2022 is c.$65/ct, reflecting the impact of inflation.