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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	31,865	24,682	147	71	4,267	72	48 %	(252)	623	(3) %
Prior year	34,609	30,355	197	59	6,622	1,417	52 %	994	593	11 %
Botswana	24,700	n/a	168	31	n/a	412	n/a	349	74	n/a
Prior year	24,142	—	193	32	—	614	—	537	70	—
Namibia	2,327	n/a	515	246	n/a	159	n/a	123	35	n/a
Prior year	2,317	—	599	293	—	181	—	149	34	—
South Africa	2,004	n/a	109	97	n/a	26	n/a	5	403	n/a
Prior year	5,515	—	134	42	—	413	—	315	378	—
Canada	2,834	n/a	85	48	n/a	35	n/a	(6)	63	n/a
Prior year	2,815	—	100	50	—	(10)	—	(68)	48	—
Trading	n/a	n/a	n/a	n/a	n/a	(104)	(3) %	(111)	2	n/a
Prior year	—	—	—	—	—	589	10 %	582	4	—
Other(7)	n/a	n/a	n/a	n/a	n/a	(456)	n/a	(612)	46	n/a
Prior year	—	—	—	—	—	(370)	—	(521)	59	—

⁽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 27.4 million carats (2022: 33.7 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 $3.6 billion (2022: $6.0 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

After strong demand in 2021 and 2022, global rough diamond demand fell significantly in 2023. With polished diamond inventories rising and increases in inflation and interest rates, jewellery retailers took a cautious approach to purchasing new stock. US consumer demand for natural diamonds was impacted by macro-economic challenges as well as rising supply of lab-grown diamonds – however, while sales of lab-grown diamonds to consumers increased, wholesale lab-grown prices continued to fall sharply, supporting further differentiation from natural diamonds. In China, economic challenges led to low consumer confidence, which lead to marginal consumer demand contraction off the subdued levels seen in 2022. In contrast, consumer confidence and demand growth in India were robust in 2023, especially towards the end of the year.

The retail slowdown led to already inflated midstream polished diamond inventories increasing over the course of the year, resulting in downward pressure on polished diamond wholesale prices. In response, the midstream industry in India implemented a voluntary moratorium on rough diamond imports into the country between 15 October and 15 December. De Beers supported its Sightholders by offering full flexibility for rough diamond allocations for Sight 9 and Sight 10 as the midstream sought to re-establish equilibrium. This resulted in very low rough diamond sales in the fourth quarter.

Overall, during the fourth quarter, industry conditions began to stabilise. Retail demand improved over the end of year holiday season, especially in the United States, helping to ease midstream inventory pressure. However, with ongoing macro-economic uncertainty, it is anticipated that recovery in rough diamond demand will be gradual.

Operational performance

Mining

Operational performance was strong in 2023. The new Venetia underground project delivered first production in June and will ramp up over the next few years.

Rough diamond production decreased to 31.9 million carats (2022: 34.6 million carats), due to planned lower production levels at Venetia as the operation transitions to underground.

In Botswana, production was broadly stable, with a 2% increase to 24.7 million carats (2022: 24.1 million carats), driven by the planned treatment of higher grade ore at Orapa.

Namibia production increased by 9% to 2.3 million carats (2022: 2.1 million carats), primarily driven by a full year of production from the Benguela Gem vessel (commissioned in March 2022) and the ongoing ramp-up and expansion of the mining area at the land operations.

South Africa production decreased by 64% to 2.0 million carats (2022: 5.5 million carats), due to the planned completion of the Venetia open pit in December 2022. Venetia continues to process lower grade surface stockpiles, while the new underground project commenced operations in June, and will ramp up over the next few years as development continues.

Production in Canada was stable at 2.8 million carats (2022: 2.8 million carats), with higher throughput offset by planned treatment of lower grade ore.

Financial performance

Due to the downturn in industry conditions from 2022 to 2023, total revenue decreased to $4.3 billion (2022: $6.6 billion), with rough diamond sales decreasing to $3.6 billion (2022: $6.0 billion). Total rough diamond sales volumes decreased by 19% to 24.7 million carats (2022: 30.4 million carats). The average realised price decreased by 25% to $147/ct (2022: $197/ct), reflecting a larger proportion of lower value rough diamonds being sold, as well as a 6%, decrease in the average rough price index.

Underlying EBITDA decreased to $72 million (2022: $1,417 million) as a result of significantly lower sales volumes, coupled with a lower average realised price (impacted by both the mix of products sold and a lower average rough price index) which negatively impacted margins in the trading business. The current year results incorporate an inventory write-down of $0.2 billion on rough stock. The increase in unit cost to $71/ct (2022: $59/ct), was primarily driven by lower production volumes from Venetia as the underground operations ramp up.

Capital expenditure increased by 5% to $623 million (2022: $593 million), due to the ramp-up of the Venetia underground project as well as the continued execution of other life-extension projects, including Jwaneng Cut-9.

An impairment of $1.6 billion (before tax and non-controlling interests) to the carrying value of De Beers has been recognised within special items and remeasurements, reflecting the near term adverse macro-economic outlook and industry-specific challenges. Please refer to note 9 in the financial statements for further details.

De Beers and the Government of the Republic of Botswana have signed Heads of Terms setting out the key terms for a new 10-year sales agreement for Debswana’s rough diamond production (through to 2034) and the new 25-year Debswana mining licences (through to 2054). De Beers and the Government of Botswana are working together to progress and then implement the formal new sales agreement and related documents including the mining licences. In the interim, the terms of the most recent sales agreement remain in place. The new arrangements constitute a related party transaction under the UK Listing Rules, given that both Anglo American and the Government of Botswana are shareholders in De Beers, and therefore will be subject to approval by Anglo American's shareholders in due course.

De Beers Jewellers delivered a stable sales performance given the global macro-economic headwinds and challenging Chinese sector.

Market outlook

Industry conditions are expected to remain challenging in the short term, but the long term outlook is favourable. Midstream and retail demand stabilised towards the end of 2023, but inventories of rough diamonds reportedly grew at producers globally. Over the course of 2024, assuming a measured approach from producers to the release of upstream inventory, the high midstream inventory levels seen in 2023 are expected to decline as retailers replenish their stocks.

Limited consumer demand growth and ongoing retailer caution are anticipated ahead of an expected return to growth into 2025.

The ongoing focus on diamond provenance – especially given the expected introduction of Russian diamond import restrictions by G7 nations – has the potential to reinforce demand for De Beers’ rough diamonds, supported by the blockchain Tracr™ platform. The global supply of rough diamonds is anticipated to continue to decline owing to the maturity of major mines and limited new discoveries.

The wholesale prices of lab-grown diamonds are falling sharply, leading to financial challenges at some leading lab-grown diamond producers. These price declines are expected to lead to further substantial reductions in retail prices (with De Beers’ Lightbox brand testing significantly lower prices for its products). This will further reinforce consumers’ understanding of the fundamental differences between lab-grown and natural diamond jewellery.

Operational outlook

2025 guidance was reduced at the December investor update, reflecting the ramp-up profile at Venetia underground as well as deferral of an expansion project at Gahcho Kué (Canada) into 2026.

Venetia is processing lower grade surface stockpiles while the operation transitions to underground. This will continue as the underground production slowly ramps up following the first production blast in mid-2023. It is expected to ramp up to steady-state levels of c.4 million carats per annum (Mctpa) production over the next few years.

Near term unit cost will be impacted by a low carat profile from Venetia as the underground project ramps up and is subsequently expected to reach a steady-state of c.$75/ct from 2026.

These impacts are reflected in the three-year guidance provided at the December 2023 Investor Update presentation, which is unchanged. Production guidance for 2024 is 29–32 million carats (100% basis) and 2024 unit cost guidance is c.$80/ct. However, De Beers will assess options to reduce production in response to prevailing market conditions.