DeBeers Expects Positive Fiscal Year Profits
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From Israel Diamond Industry Portal:
I can’t wait to see this happen in reality. Keep in mind, DeBeers reduced mining output in the first quarter by ninety percent and it’s not like they expect Q3 and Q4 to make up for Q1. They claim themselves that while they feel a recovery is underway, it will be a muted recovery nonetheless, and “regular” diamond trading levels will only return sometime in mid- to late 2010. So how do they still expect to have a profitable year with such a massive decline in production? Cost cutting, of course!
The De Beers diamond company said it plans to cut $1.5 billion in operating and capital expenditures in 2009, Reuters reported.
The diamond exploration company said it will achieve a positive interim and full year bottom line despite slashing diamond output by 90% in the first quarter, according to the Reuters report.
Cutting $1.5 billion in expenses is a massive amount. I would love to know how they intend to accomplish that number.
