Alrosa increases exports to 77% of diamond sales in Q1
MOSCOW. May 15 (Interfax) - Exports accounted for 77% of Alrosa's rough diamond sales in the first quarter of 2012, and sales on the domestic market made up 23%, the Russian diamond miner's financial statement indicates.
A year earlier, exports made up 70% of Alrosa's rough diamond sales.
Rough diamonds increased to 96.4% of total sales in the first quarter of 2012, from 95.1% a year earlier, while cut diamonds dropped to 3.6% from 4.9%.
The company's revenue grew 40% year-on-year to 31.839 billion rubles in the first quarter.
The company sold 88.1% of exported rough diamonds on the free market, up from 83.1% a year earlier. These sales are primarily targeted at Alrosa's long-term clients - 19 jewelry and diamond cutting companies, including Steinmetz, Pluczenik, Rosy Blue and Diamond India. Alrosa holds trading sessions, usually three-day, once a month (on January 17-20, February 14-17 and March 14-19 in the first quarter), according to the company's website. Rough diamonds are sold in standard lots and boxes.
Large diamonds, weighing 10.8 carats or more, which are priced individually unlike smaller stones, sorted by weight, quality, color and form, are sold at international auctions. Such diamonds generated 7.1% of Alrosa's rough diamond sales, compared to 8% a year earlier. It was reported earlier that Alrosa earned $67 million at three auctions for large diamonds in the first quarter.
Another export channel is Almazjuvelirexport, through which by law Alrosa sells control batches of diamonds to determine their market price for sale of rough diamonds to state repository Gokhran. The proportion of sales through Almazjuvelirexport plunged to 2.5% in the first quarter from 7.4% a year earlier.
Sales of industrial diamonds accounted for 2.1% of Alrosa's sales.
On the domestic market, Alrosa has five long-term clients: Kristall and Kristalldiam in Smolensk, Ruiz Diamonds (a division of Lev Leviev's Ruiz group), Yakutia's EPL Diamond and Mosalmaz, but their share of total sales in Russia is just 12%. Alrosa did not sell any rough diamonds to Gokhran in the first quarter.
Jewelry quality diamonds weighing less than 10.8% accounted for 95.4% of domestic sales, compared to 97.2% a year earlier. Large diamonds accounted for 0.7% down from 1.4%.
Alrosa sells cut diamonds primarily on the export market, with domestic sales accounting for just 1.1% in the first quarter of 2012, compared to 0.6% a year earlier. The main markets for cut diamonds in the quarter were Belgium, Israel and Hong Kong, which accounted for respectively 44.1%, 25.7% and 11.1% of sales.
The Alrosa group, which in addition to the flagship company includes Alrosa Nyurba , Almazy Anabara, Severalmaz and a 32.8% stake in Angola's Catoca, plans to increase revenue by 15% to $5.074 billion in 2012. However, the company might lower its guidance for diamond production in 2012, which was previously 34.6 million carats.