Clifton Movirongo

Namib Desert Diamonds (Pty) Ltd (NAMDIA) has declared a N$80 million dividend payable to the Government of Namibia for the financial period 2019/2020.

The company’s full year profit after tax amounted to N$95.2 million, down 41 percent from prior year’s N$161.9 million, with N$63 million paid in taxes to the Ministry of Finance.

NAMDIA also paid export levy amounting to N$19 million for the period under review.

“NAMDIA performed relatively well during 2019/2020, despite an extremely challenging year for the diamond industry. This positive financial performance is attributed to a well-executed strategy that focuses on revenue maximization for Namibian diamonds; optimization of the sales strategy and robust internal processes and procedures,” said NAMDIA Chairperson Bryan Eiseb.

He said the company having considered the volatile economic and market conditions, had resolved to defer its dividend payment for the 2020 financial year.

“For the 2020 financial year the board after having considered the current economic conditions, resolved not to declare a dividend. Though, the company is financially in a stable condition. The Namibian nation does not need to worry,” said Eiseb.

“The board may consider its position in future depending on evolving dynamics of our economy and the diamond industry at large.”

He said the company had set up the NAMDIA Foundation through which all its Corporate Social Investment (CSI) programmes will be channelled.

“During the year NAMDIA has intensified their efforts towards Corporate Social Investment. They have established the NAMDIA Foundation where all CSI programmes will be implemented. The focus areas include health, education, and sports as nation building initiatives,” Eiseb said.

NAMDIA CEO Kennedy Hamutenya lamented the negative impact that synthetic diamonds are having on rough natural diamonds.

“Even De Beers our biggest partner, has gone into synthetics. So we find ourselves in a situation where synthetics are taking up a portion of the rough natural rough diamonds business. Because of low demand, we have high inventory of polished diamonds. If we have polished diamonds in the pipeline that are not moving, there’s a backward domino effect to our business, that means also there is low demand for rough diamonds,” he said.

Hamutenya added that the weak downstream sentiment related to macroeconomical and geopolitics factors, including US-China trade tensions, the impact of Hong Kong protests and certain macroeconomic issues affecting consumer confidence in India, weighed down on the diamond industry.