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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	34,609	30,355	197	59	6,622	1,417	52 %	994	593	11 %
Prior year	32,276	33,357	146	58	5,602	1,100	47 %	620	565	7 %
Botswana	24,142	n/a	193	32	n/a	614	n/a	537	70	n/a
Prior year	22,326	—	152	32	—	464	—	407	72	—
Namibia	2,137	n/a	599	293	n/a	181	n/a	149	34	n/a
Prior year	1,467	—	565	359	—	101	—	68	91	—
South Africa	5,515	n/a	134	42	n/a	413	n/a	315	378	n/a
Prior year	5,306	—	113	45	—	241	—	82	309	—
Canada	2,815	n/a	100	50	n/a	(10)	n/a	(68)	48	n/a
Prior year	3,177	—	62	44	—	68	—	4	42	—
Trading	n/a	n/a	n/a	n/a	n/a	589	10 %	582	4	n/a
Prior year	—	—	—	—	—	515	11 %	505	4	—
Other(7)	n/a	n/a	n/a	n/a	n/a	(370)	n/a	(521)	59	n/a
Prior year	—	—	—	—	—	(289)	—	(446)	47	—

⁽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 33.7 million carats (2021: 36.3 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 $6.0 billion (2021: $4.9 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, and corporate.

Markets

The first half of 2022 saw largely positive trading conditions throughout the diamond pipeline; the year started with retailers restocking following strong consumer demand for diamond jewellery sales over the 2021 holiday season. While the start of Russia’s invasion of Ukraine and the imposition of related formal sanctions, as well as self-sanctioning, on Russian diamonds created uncertainty in the sector, healthy consumer demand, particularly in the US, led to polished price growth and robust demand for rough diamonds in the first half of the year. De Beers’ focus on enhanced provenance assurance for its rough diamonds helped underpin solid demand.

By June, the global economic picture was more uncertain, owing to interest rate increases by advanced economies’ central banks to combat accelerating inflation. With a weaker economic outlook, consumer demand for diamond jewellery in the US softened in the second half of 2022, though it remained above pre-Covid-19 levels. Amid this economic uncertainty, retailers restocked more cautiously, causing midstream polished diamond inventories to build up through the second half of the year, putting downward pressure on polished prices and softening demand for rough diamonds. In China, the heightened Covid-19 restrictions from the second quarter onwards impacted diamond jewellery retail sales, resulting in negative demand growth for the year.

Financial and operational overview

Total revenue increased to $6.6 billion (2021: $5.6 billion), with rough diamond sales rising to $6.0 billion (2021: $4.9 billion), reflecting strong demand for rough diamonds, particularly in the first half of the year, with the midstream replenishing stocks following strong consumer demand over the 2021 holiday season. Rough diamond sales volumes totalled 30.4 million carats (2021: 33.4 million carats). The average realised price rose by 35% to $197/ct (2021: $146/ct), driven by growth in the rough price index, as well as selling a larger proportion of higher value rough diamonds in the first half of the year. The average rough price index increased by 23%, reflecting overall positive consumer demand for diamond jewellery, particularly in the first half of the year.

Underlying EBITDA increased by 29% to $1,417 million (2021: $1,100 million), reflecting overall positive consumer demand for diamond jewellery. Unit costs were broadly flat at $59/ct (2021: $58/ct), as rising inflation and higher input costs were offset by the benefits of higher production and favourable exchange rates.

Capital expenditure increased by 5% to $593 million (2021: $565 million), largely due to the Venetia underground project, which is expecting first production in 2023, and the continued execution of life-extension projects, including Jwaneng Cut-9 and at the Namibian land operations.

Operational performance

Mining

Rough diamond production increased by 7% to 34.6 million carats (2021: 32.3 million carats), reflecting strong operational performance and higher planned levels of production to meet continued strong demand for rough diamonds, particularly in the first half of the year.

In Botswana, production increased by 8% to 24.1 million carats (2021: 22.3 million carats), owing to strong plant performances at both Jwaneng and Orapa, as well as planned higher grade at Orapa.

Namibia production increased by 46% to 2.1 million carats (2021: 1.5 million carats), primarily due to the commissioning of the Benguela Gem diamond recovery vessel, which was delivered ahead of schedule and below budget, as well as the treatment of higher grade ore at the land operations.

South Africa production increased by 4% to 5.5 million carats (2021: 5.3 million carats), due to the treatment of higher grade ore from the final cut of the open pit at Venetia. The mining of the open pit was completed in December and the mine will transition to underground operations in 2023.

Production in Canada decreased by 11% to 2.8 million carats (2021: 3.2 million carats), due to the treatment of lower grade ore and the impact of tight labour markets.

Brands and consumer markets

Despite the near term economic uncertainty, De Beers Jewellers have continued to focus on developing their geographic footprint in China, with underlying demand for branded diamond jewellery expected to remain strong following the removal of Covid-19 related restrictions.

Operational and market outlook

Early indications are that the 2022 holiday season was robust, with diamond jewellery sales remaining above pre-Covid-19 levels, though below the record level seen in 2021. However, continued softening in global macro-economic conditions could see a contraction in consumer spending and demand for diamond jewellery, which may result in lower demand for rough diamonds in the near term. This may be partly mitigated by an increase in demand for diamond jewellery in China, following the removal of Covid-19 restrictions in late 2022.

De Beers continues to invest in its leading ability to provide source assurance for its diamonds at scale, underpinned by the Tracr™ blockchain platform. This proprietary technology provides an immutable record of a diamond’s provenance, a key priority for consumers, underpinning confidence in natural diamonds.

De Beers considers that increased focus on diamond provenance by a number of US-based jewellery businesses and global brands has the potential to underpin continued demand for De Beers’ rough diamonds in the medium and longer term. Consumer desire for natural diamonds remains robust in key consumer markets, and over the medium term the global supply of rough diamonds is expected to decline slightly owing to limited new discoveries, supporting the value growth potential for natural diamonds.

Production guidance for 2023 is 30–33 million carats (100% basis), subject to trading conditions.

2023 unit cost guidance is c.$80/ct.