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Operating and FINANCIAL REVIEW

Sorter, Selma Indongo, uses a 3D scanner during training at the Diamond Academy, Kimberley, South Africa

2012

For more information and to download this document, please visit www.debeersgroup.com. Acknowledgements DeBeers UK Limited 2013. All rights reserved. DeBeers UK Limited is a company incorporated in England and Wales with registered number 2054170 and registered oce 17Charterhouse Street, London EC1N 6RA. DeBeers, A Diamond is Forever, DTC, and Forevermark are used under licence by DeBeers UK Limited. Prepared and produced by the DeBeers Group of Companies in partnership with Salterbaxter. Designed by Salterbaxter www.salterbaxter.com About this report
This report relates to the performance of De Beers sa and is designed to be read alongside our Report to Society 2012, to be released later this year. These reports form part of our annual reporting cycle and together cover the nancial and sustainability performance of the De Beers Group of Companies. Both reports adhere to Global Reporting Initiative Sustainability Reporting Guidelines and form part of our Communication on Progress to the United Nations Global Compact.

www.debeersgroup.com

Operating and Financial Review 2012

Contents

02

04

05

08

10

19

21

23

24

26

27

02 10 24

Our company

04 19 26

Introduction from the Chairman

05 21 27
01

CEO statement

08 23

Exploration

Production

Rough diamond sales

Brands

Financial highlights

Governance and risk

Sustainability

The Board and executive management

Operating and Financial Review 2012

Our company
De Beers was established in1888. It is the worlds leading diamond company, with unrivalled expertise in the exploration, mining and marketing of diamonds.

A global business

n  Countries in which De Beers

has mining operations.  Countries in which De Beers conducts exploration, mining and rough diamond sales, and operates downstream value-creating businesses.

2 4

Our mining entities and their operations


1

Canada
3,967 1,560
A B

Botswana

MINING, CanaDa 100% owned. Established 1998.


Tonnes treated 000 Carats recovered 000 A Snap Lake B Victor

DEBSWANA 50/50 joint venture with the Government of the Republic of Botswana. Established 1969.
Tonnes treated 000 Carats recovered 000 C Damtshaa D Orapa

21,873 20,216
E Letlhakane F Jwaneng
F

D E

Namibia

South Africa
N

NamDeb HoLDings 50/50 joint venture with the Government of the Republic of Namibia, on land and sea. Established 1994.
Tonnes treated 000 Carats recovered 000 G Atlantic 1 H  Alluvial Contractors

mining, soUtH africa (De Beers consoLiDateD mines (DBCM)) 74/26 (BEE partner Ponahalo Holdings). Established 1888.
Tonnes treated 000 Carats recovered 000 L Venetia M Kimberley

12,809 1,667
I Elizabeth Bay J Mining Area 1 K Orange River

13,691 4,432
N Voorspoed O  Namaqualand

M O

J K

02

Operating and Financial Review 2012 Our company

Together with our joint venture partners, De Beers mines for diamonds across Botswana, Canada, Namibia and South Africa. As part of the companys operating philosophy, the people of De Beers are committed to living up to diamonds by making a lasting contribution

to the communities in which they live and work. In the countries in which we have mining operations, this means carrying out protable business, while at the same time helping governments achieve their aspirations of turning natural resources into shared national wealth.

De Beers and the global diamond value chain


01 Exploration Modern exploration uses highly sophisticated technologies to determine the economic viability of deposits. De Beers exploration business currently focuses on Angola, Botswana, Canada, India and South Africa. 02 Production De Beers has both underground and open-pit mines. We commercially mine alluvial stones using onshore extraction techniques and specialised ships. Through Element Six (E6), our synthetic diamond supermaterials business, we supply tool and application manufacturers across a diverse range of global markets. 03 Rough diamond sales De Beers sorts and sells rough diamonds to independent customers known as Sightholders through our rough diamond sales operations: Global Sightholder Sales, NDTC and DTCB. Sightholders trade rough diamonds, and cut and polish diamonds prior to the manufacture of jewellery. We also sell rough diamonds to Sightholders and non-Sightholders, through our Auction Sales business. 04 Cutting, polishing and manufacturing Cutting and polishing of diamonds, and the manufacture of diamond jewellery, take place around the world, and are concentrated in the following major centres: Antwerp, Botswana, China, India, Namibia, New York, South Africa and Tel Aviv. De Beers Diamond Jewellers (DBDJ) has its own jewellery design and development capacity. 05 Brands We are involved in diamond retail through DeBeers Diamond Jewellers, an independently managed retail joint venture, and Forevermark, our proprietary diamond brand.

Company structure
Shareholders and corporate structure
Anglo American plc group 85% Government of the Republic of Botswana 15%

DB Investments (Lux) De Beers Group of Companies

De Beers across the diamond pipeline


Exploration
Exploration1

Production Mining
Canada South Africa (De Beers Consolidated Mines) 74% Debswana Diamond Company 50% Namdeb Holdings 50% Namdeb Diamond Corporation

Rough Diamond Sales Supermaterials


Element Six (E6) Technologies 100% Abrasives 60% Global Sightholder Sales Auction Sales

Brands
Forevermark De Beers Diamond Jewellers (DBDJ) 50%

Sightholder Sales, South Africa

De Beers Marine Namibia (Debmarine Namibia)

DTC Botswana (DTCB) 50% Namibia DTC (NDTC)

Shareholders Owned and controlled subsidiaries and divisions Joint ventures and independently-managed subsidiaries

50%

 xploration is undertaken through E a number of wholly owned and joint venture subsidiaries of De Beers

03

Operating and Financial Review 2012

Introduction from the Chairman


De Beers continues to invest in its leadership position and steer itself towards long-term growth.

Cynthia Carroll Chairman, De Beers Group

We are now several years on from the global financial crisis of 2008/2009 that shook the diamond industry. As the dust has settled, it has become increasingly clear that decades of a relatively stable diamond industry have given way to one that can change dramatically from year-to-year, and even from Sight-to-Sight. This new dynamic will shape the industry for decades to come, and De Beers is focused on identifying emerging risks, capturing and creating new opportunities, and ensuring that volatility doesnt necessarily mean instability. During 2012, challenging trading conditions in the rough and polished diamond sectors impacted on diamond prices and led to a 16 percent decrease in De Beers overall sales to US$6.1 billion (2011: US$7.3 billion). Despite the short-term market diculty, the company continued to position itself for long-term growth by strengthening its balance sheet and investing in its leadership position across the diamond pipeline. The long-term market opportunity for diamonds is clear. With production expected to plateau over the long-term, and demand continuing to rise driven primarily by growth in China De Beers is focused on maximising the value and life of its resource while expanding its reach into new markets. During 2012, De Beers progressed with several sizeable projects to both extend the life of its largest mines and add new production to its future portfolio. The Jwaneng Mine Cut-8 Project in Botswana, the Venetia Mine Underground Project in South Africa, and the Gahcho Ku Project in Canada, will together add approximately 240 million carats to De Beers production over the coming decades and create long-term employment opportunities. De Beers is also focused on securing long-term access to supply, a core part of which is understanding the aspirations of producer partners and putting those aspirations at the heart of the business strategy. In particular in Botswana, which accounts for approximately two-thirds of De Beers annual production, the migration of the companys London-based sales activities to Gaborone is on track for completion by the end of 2013.

The migration is a signicant commercial and logistical feat, and is one of the biggest undertakings in the history of De Beers. By the time the rst Sight takes place in Botswana at the end of 2013, the Government and people of Botswana will be taking a more active role in adding value to, and deriving value from, their precious natural resource. The economic opportunities presented by the migration, including the procurement of ancillary services, local skills development and the contribution to government revenues, make this an exciting moment for Botswana. De Beers is committed to working with all stakeholders to ensure the citizens of Botswana have the opportunity to fully benet from the opportunities created. In August, Anglo American completed the acquisition of a 40 percent shareholding in De Beers from the Oppenheimer family, thereby increasing Anglo Americans shareholding in De Beers to 85 percent. The integration of De Beers into Anglo American provides the company with the resources, capital and technical excellence needed to optimise a nite resource and deliver large-scale projects to bring new production on-line for the future. The integration process, which is largely focused on the ecient assimilation of services and processes, has made signicant progress and is nearing completion. With all Board approvals now received, all material issues relating to the integration should be concluded by the end of the rst quarter of 2013. 2013 marks De Beers 125th anniversary. Throughout its history, DeBeers model has been built on strong and mutually benecial partnerships. It is these partnerships that will continue to propel the business forward. In Botswana and Namibia, De Beers mines in equal partnership with the governments of those countries, and in South Africa, with its 26 percent BEE partner Ponahalo Holdings. In the midstream, De Beers works in partnership with its Sightholders, the worlds leading diamantaires, to add value to its diamonds. And further downstream, De Beers partners with leading retailers through Forevermark, and with the worlds pre-eminent luxury retailer, LVMH Mot Hennessy Louis Vuitton SA, in De Beers Diamond Jewellers. As De Beers looks toward a future of opportunity, the company will draw on the strength and support of Anglo American to maximise its leadership position and deliver value for its partners no matter what part of the diamond pipeline they participate in.

Cynthia Carroll

04

Operating and Financial Review 2012

CEO statement
De Beers generates strong cash ow, continues to lower debt and expands project base despite challenging trading conditions.
While 2012 saw a continuation of the challenging trading conditions that began during the fourth quarter of 2011, De Beers continued to position itself for growth by strengthening its balance sheet and progressing several large scale projects. 2012 was an historic year for De Beers. Anglo Americans acquisition of a majority shareholding in De Beers opened up further opportunities for us as we integrate key areas of our operations. While De Beers ended its long association with the Oppenheimer family who gave so much to our business, integration with Anglo American will enable us to draw on the skill, resource and expertise of one of the worlds leading mining companies. Safety The safety of our employees is our priority, and we will tolerate nothing less than zero harm. While we have made important progress in driving a safety culture, De Beers sadly experienced three fatalities in 2012 (2011: seven). One of these incidents, a slope failure at Debswanas Jwaneng Mine, resulted in a seven-week suspension of pit operations to allow for a comprehensive geotechnical review to ensure it was safe for operations to recommence. Diamonds represent commitments that last a lifetime, but no diamond is ever worth a life. In 2011, I called for a full review of our safety culture. While I am pleased to report an improvement in our safety performance, with the lost-time injury frequency rate (LTIFR) falling to 0.13 (2011: 0.15), my team and I are committed to pushing for further improvements across the organisation.

Philippe Mellier CEO, De Beers Group

Free cash flow

US$697 million
(December 2011 US$816m) Third-party debt

US$722 million
(December 2011: US$1,177m) Third-party gearing

14.1%
Total tonnes treated Total carats removed LTIFR* LTISR

(December 2011: 22.3%)

Performance indicators
12 11 11/12

52,340 27,875 0.13 1.90

50,247 31,328 0.15 4.53

4% -11% 0.02 2.63

* Lost time injury frequency rate  Lost time injury severity rate

Financial indicators (US$m)


12 11* Variance %

Total sales EBITDA Operating prot Free cash ow Net interest bearing debt (excluding shareholders loans)

6,074 1,075 815 697 722

7,262 1,763 1,491 816 1,177

-16 -39 -42 -15 -39

* Comparatives have been restated on a pro-forma basis following changes in accounting policy for joint ventures and employee benets.

The processing plant at DBCMs Venetia Mine.

05

Operating and Financial Review 2012 CEO statement

Market overview The global economic volatility that began to impact the diamond market in the fourth quarter of 2011, continued to be felt throughout 2012. Consumer demand withstood market pressures relatively well with demand for diamond jewellery in the key markets of the US, China and Japan growing, albeit at a slower pace than in 2011. Further upstream, rough diamond prices remained level during the rst half of 2012. By the second half of the year, weaker polished prices, high levels of cutting centre stock and tightening liquidity in the midstream combined to reduce demand for rough diamonds, and trigger a rough diamond price correction during the third quarter. By the end of 2012, however, rough diamond prices stabilised, reecting a modest improvement in consumer demand during the holiday sales season in most major diamond jewellery markets. Performance After an exceptional performance in 2011, in which we posted 29 percent price growth, De Beers rough diamond prices decreased 12 percent between 1 January and 31 December 2012, in line with polished diamond prices. This price decrease, reecting diminished demand, changing product requirements from Sightholders and reduced availability of some goods, resulted in a 15 percent decrease in rough diamond sales to US$5.5 billion in 2012 (2011: US$6.5 billion). Despite these challenging market conditions, De Beers continued to be highly cash generative, with free cash ow of US$697 million (2011: US$816 million). De Beers also continued to signicantly reduce its net debt, which now stands at US$722 million (excluding shareholder loans) (2011: US$1.18 billion).

Production In light of prevailing diamond market trends, the companys stated strategy of producing to demand was maintained during 2012. De Beers recovered 27.9 million carats from our operations in Botswana, Canada, Namibia and South Africa (2011: 31.3 million carats). Producing in accordance with demand allowed the operations to continue the focus on maintenance and waste stripping backlogs introduced in 2011. The sale of Finsch Mine, which contributed 0.9 million carats in 2011, impacted year-on-year production totals. Production was also impacted by operational challenges, including the slope failure at Jwaneng Mine in the middle of the year. Projects and exploration The long-term fundamentals of the diamond industry remain strong, and De Beers continues to invest in all parts of the diamond pipeline to position the business for future growth. In Botswana, construction of the infrastructure at the Jwaneng Mine Cut-8 project was completed. Cut-8 will allow access to approximately 95 million carats of mainly high quality diamonds in approximately 80 milion tonnes mined1, and extend the life of the worlds richest diamond mine to at least 2028. As part of our 10-year sales agreement with the Government of the Republic of Botswana, De Beers successfully relocated its aggregation, quality assurance and Sight preparation functions to Botswana ahead of schedule. Migration will continue throughout 2013, and by the end of the year, De Beers will sell its worldwide production to international Sightholders from its new facilities in Gaborone. In South Africa, the Venetia Mine Underground Project was approved by the De Beers and Anglo American Boards. The environmental permitting process was completed during 2012, and nal outstanding regulatory clearances were obtained in February 2013. The project, which will commence during 2013, will extend the life of South Africas largest diamond mine beyond 20402. The project life of mine contains an estimated 96 million carats in approximately 130 million tonnes mined3. In Canada, the Environmental Impact Review documentation for the Gahcho Ku Project, in which we have a 51 percent interest, has been submitted for review, and the Review Panel is expected to issue a decision report in 2013. The Gahcho Ku life of mine is 11 years and contains an estimated 48 million carats in approximately 31 million tonnes mined4. De Beers increased expenditure on exploration in 2012 to US$59 million (2011: US$46 million), supporting work programmes in Angola, Botswana, Canada, India and South Africa to secure longer-term supply for the business. In October, we expanded our exploration footprint in Canada, signing an Option and Subscription Agreement with Peregrine Diamonds Ltd, in respect of early stage work on the Chidliak Project on Ban Island.
3

Tanker on the winter road heading to Snap Lake Mine.

This estimate of carats contains Indicated (24%) and Inferred (76%) Resources. Not all Inferred Resources may be upgraded to reserves, even after additional drilling. Further details appear in the 2012 Anglo American Plc Annual Report. The current mining rights expire in 2038; Venetia Mine will apply to extend the mining rights at the appropriate time in the future. 06

This estimate of carats contains Indicated (77%) and Inferred (23%) Resources. Not all Inferred Resources may be upgraded to reserves, even after additional drilling. Further details appear in the 2012 Anglo American Plc Annual Report. Details appear in the 2012 Anglo American Plc Annual Report.

Operating and Financial Review 2012 CEO statement

Brands Brands are increasingly important in consumer diamond markets, and De Beers continues to invest in its two downstream businesses. Forevermark continued to grow strongly in 2012, particularly in the core markets of China, Japan, India and the US. With launches in Canada and the UAE during the year, Forevermark is now available in more than 900 retail partners in 12 markets. De Beers Diamond Jewellers (DBDJ) continued to focus on expanding its store network in China, a market of signicant opportunity for high-end jewellery brands. New stores were opened in Shanghai and Nanjing, giving DBDJ ve outlets in China with an additional store scheduled to open in 2013. DBDJ currently has 43 stores in leading diamond consumer markets around the world.

Fig. 1

Consumer demand forecasts, 2012 and 2017 (US$ PWP *)


2012

USA 37% China/Hong Kong 13% India 9% Japan 10% Gulf 8% Rest of world 22%

2017 F

USA 34% China/Hong Kong 17% India 14% Japan 7% Gulf 9% Rest of world 19%

Note: These figures provide estimates and forecasts of the size and growth of main diamond consumer markets based on pipeline and consumer research commissioned by De Beers. 2012 results are preliminary. *Polished Wholesale Price

Outlook De Beers expects moderate growth in diamond jewellery demand in 2013. This will be supported primarily by a more positive picture emerging from China and India compared to 2012. Some upside is possible in the US, while trading conditions in other developed markets are likely to be challenging. The rough diamond manufacturing sector closed 2012 with high levels of inventory, particularly in the higher-end categories of diamonds, and faces continued pressure in terms of midstream liquidity. In the medium to long term, industry fundamentals are expected to strengthen as diamond production plateaus and demand continues to increase.

Philippe Mellier
Onboard the Debmar Atlantic mining vessel at nightfall.

07

Operating and Financial Review 2012

Exploration
De Beers is currently exploring for diamonds in Angola, Botswana, Canada, India and South Africa. Centralised laboratory and technical services for diamond exploration are located in South Africa.

Charles Skinner Head of Exploration

 As early and advanced-stage projects progressed, 11 new discoveries increased our portfolio to 169 kimberlites. In Angola, new mining laws produced improved investment conditions and advanced the prospect for profitable future diamond production.
Operating highlights In 2012, De Beers spent US$59 million (including US$9 million on marine and gold exploration which were managed under separate joint venture agreements) on exploration work programmes over ground holdings peaking at 16,195km2 (2011: US$46 million over 16,484 km2).1 A further US$11 million was spent in Angola on the resource evaluation of two kimberlite pipes that comprise the Mulepe-1 deposit. Exploration also provided specialist services and support to resource extension programmes for the Jwaneng and Orapa Mines (Botswana) and Victor Mine (Canada). Angola: Drill testing for diamond grade in the Lunda Northeast concession, was completed on 14 of the 22 priority pipes with results expected early in 2013. The concessions seven-year term expired in August 2012. Negotiations are underway for a Mineral Investment Contract under the more favourable terms and conditions set out in the new Angolan Mining Law, which came into force in late 2011. The conceptual study for the Mulepe-1 kimberlite was completed in November but indications suggest a stand-alone deposit is uneconomic under current assumptions.

The Superintendent of Environmental Assessment and Permitting for the Gahcho Ku Project (right) explains its features at a Community Hearing.

Botswana: Drill testing of the Orapa satellite pipes in the mine lease areas was concluded on behalf of Debswana. Early stage reconnaissance geophysics and drilling continued in the Kang, Lerala and Palapye prospecting licences, with no new discoveries made. Canada: Core drilling was completed for microdiamond samples on the two Alpha satellite pipes at Victor Mine, and reconnaissance sampling was carried out over target areas in Quebec and Ontario. Exploration assisted the De Beers/Mountain Province joint venture Gahcho Ku Project, interpreting data from the airborne gravity survey. Following agreement with Peregrine Diamonds Ltd, De Beers has retained rights to enter a joint venture in 2013 on the Chidliak Project on Ban Island and technical due diligence has begun on the 61-kimberlite cluster.

1

This gure has been restated to reect peak ground holdings area in 2011, rather than the year-end gure, which has been reported as a standard in previous years.

08

Operating and Financial Review 2012 Exploration

Ground holdings as at 31 Dec (km2)


Venture km2 12 km2 11 Variation

Angola Botswana Canada India South Africa

0 7,804 170 0 455

3,017 7,655 248 2,128 325

-100% 2% -31% -100% 40%

Performance indicators
12 11 11/12

LTIFR LTISR Exploration expenditure (US$m)

0.64 0.31 59.0

0.15 1.03 46.0

0.49 -0.72 16.0

India: Early-stage geological modelling, terrain mapping and reconnaissance sampling continued in 2012. In the Mahabubnagar licence area, further discoveries brought the portfolio to 22 kimberlites, and testing of priority pipes for diamond potential is underway. The Mahabubnagar reconnaissance permit period expired during the year, however, application is underway for the prospecting licence and a number of other reconnaissance permit applications remain pending. South Africa: Ground geophysical surveys were completed in the Finsch area, and targets selected for drill testing. South Africa remains highly prospective and specialist reviews of the historical databases continued in 2012. Several of the De Beers prospecting licence applications are pending. ECOHS overview In 2012, Exploration worked 1.5 million man hours (2011: 1.4 million) and traversed more than a million kilometres by road, often in dicult and remote areas. Five lost-time injuries (LTIs) were reported, taking the LTIFR to 0.64 (2011: 0.12). An improved safety culture encouraged increased reporting, with incidents rising from 192 (2011) to 528 (2012) of which nine were high potential. Outlook De Beers remains focused on exploration projects with the potential to deliver carat production within three to ve years, and on building a strong discovery pipeline at the early stage. In Botswana, South Africa and India, technical reviews of the databases, licence applications and reconnaissance phase work will take priority. De Beers has retained rights to enter a joint venture in 2013 with Peregrine Diamonds Ltd on the Chidliak cluster in Canada and, in the interim, is conducting assessments of pipe sizes and microdiamond grades of the kimberlites discovered. In Angola, new mineral legislation, improving investment conditions and high prospective potential, oer De Beers new and promising opportunities for exploration concessions.

Geophysical Survey in Angola.

09

Operating and Financial Review 2012

Production
Canada
Victor Mine: Production was steady at Victor Mine in 2012. A preliminary desktop assessment indicated that more work would be required in order to improve the economics of the identied diamond-bearing kimberlites adjacent to current operations. Accordingly, the business is pursuing an aggressive cost management plan and started a scoping study to investigate ways to enable the mining of the identied kimberlites adjacent to Victor and thus extend Victor Mines forecast life to beyond 2018.
Tony Guthrie CEO, Mining, Canada

 In 2012, our focus was to improve the operational performance of our key mining assets in Canada, and pursue extensions and growth opportunities that fit with the existing portfolio.
In Canada, De Beers operates Snap Lake Mine in the Northwest Territories and Victor Mine in northern Ontario. De Beers is a joint venture partner with Mountain Province Diamonds on the Gahcho Ku Project, Northwest Territories, which is currently in the permitting phase. De Beers also has an option agreement with Peregrine Diamonds Ltd on the Chidliak Project on Baffin Island in northern Canada. Operating highlights De Beers recovered 1.56 million carats in Canada in 2012 (2011: 1.66 million). Of the total carat recovery, Victor Mine delivered 0.69 million (2011: 0.78 million) and Snap Lake Mine produced 0.87 million (2011: 0.88 million). In all, 3.97 million tonnes of ore were treated (2011: 3.55 million). Victor Mine treated 3.05 million tonnes (2011: 2.73 million). Snap Lake Mine treated 0.92 million tonnes (2011: 0.81 million). Decreased carat production reected the dual impact of a lower than expected ore grade and challenging water management issues at Snap Lake Mine.

Snap Lake Mine: Production was hindered by surface and underground water issues, requiring additional capital investment and management focus in early 2012. In addition, carat recovery decreased marginally from the previous year due to higher than expected ore dilution and lower than expected ore grade. Intensied mining and treating redressed some of the production issues. Preliminary investigations commenced to develop asset optimisation opportunities for execution during 2013. Although De Beers was successful in handling the spring melt, underground ows at Snap Lake Mine hampered productivity. De Beers strives to continually improve water management and to work within the discharge parameters of the water licence. Snap Lake Mine received a new eight-year water licence in 2012. Gahcho Ku Project: Following the nalisation of the feasibility study in 2010, Gahcho Ku has received De Beers Board approval, subject to satisfactory completion of the permitting process and receipt of certain regulatory clearances. The Environmental Impact Statement was updated in April, and the nal phase of the Environmental Impact Review by the Mackenzie Valley Environmental Impact Review Board is underway. Public hearings in Yellowknife and in local Aboriginal communities were held in December, and the review panel is scheduled to le its recommendation for Federal Ministerial Approval in 2013.

2012 production statistics (000)


Mines Snap Lake Victor Total
Tonnes treated Carats recovered

918 3,049 3,967

870 690 1,560

Performance indicators
12 11 11/12

LTIFR LTISR Mining licence area (ha) Tonnes treated (000s) Carats recovered (000s)

0.24 0.23 7,236 3,967 1,560

0.19 1.03 7,236 3,545 1,660

0.05 -0.80 0.00 422 -100

10

Operating and Financial Review 2012 Production

ECOHS overview De Beers retained its record in Canada since it began mining in the country in 2008, reporting no loss of life incidents for the fth consecutive year. Snap Lake Mine recorded three LTIs; Victor Mine one; and Gahcho Ku none. The LTIFR was 0.24 (2011: 0.19), mainly due to rst-quarter injuries at Snap Lake. By the end of the year, Snap Lake Mine had operated 1.3 million hours, or 290 days, without any LTIs. Victor Mine suered one injury in August, following 3.0 million LTI-free hours, and nished the year with over 390,000 more LTI-free hours. Risk-based interventions, training and a strong reporting culture focused on near hit reporting, remain a core part of the safety strategy. Exploration, the corporate oce, Snap Lake and Victor Mines maintained OHSAS18001 certication. All Canada operations remained ISO14001 certied. De Beers corporate social investment activities in Canada are focused on education, the arts, community development initiatives, and health projects, either directly or through Impact Benet Agreements. Outlook De Beers will continue to focus on safe and protable operations, projects and exploration activities in Canada. Analysis of extension options at Victor Mine will continue, along with the optimisation of assets both at Snap Lake and Victor Mines. 2013 is expected to be a landmark year for the Gahcho Ku Project as it plans to move from the permitting phase toward construction and production. The work programme and investment review for the Chidliak Project are expected by December 2013. These activities will together enhance the companys industry leadership in Canada.
www.canada.debeersgroup.com

Underground pumping station, Snap Lake Mine.

11

Operating and Financial Review 2012 Production

South Africa
Although production was unaected by the labour unrest experienced in other South African mining sectors, DBCM management closely monitored events and communicated with employees to ensure stability was maintained. DBCM and the National Union of Mineworkers signed a two-year wage agreement in August 2011. Consequently, the company suered no direct impact from the wildcat strikes and subsequent violent clashes. In addition, the retention of skilled supervisory and managerial employees a key risk for the business, improved signicantly during 2012. The Board of De Beers sa approved the Venetia Underground Project in July, following completion and assurance of the feasibility study in the rst half of the year. The Venetia Environmental Impact Assessment was approved in July and the Department of Mineral Resources (DMR) sanctioned the companys amended Environmental Management Plan in October. Final regulatory clearances were obtained in February 2013. The approximately US$2 billion capex investment will convert the open-pit mine into an underground venture and extend the life of mine beyond 20405. In 2012, the asset package for the purchase of Namaqualand Mines by Emerald Panther Investments (EPI) was adjusted to enhance its aordability. Under the new agreement, DBCM will retain responsibility for continued rehabilitation work in the Buels Marine Mining Rights area. EPI will acquire the balance of the Namaqualand Mines mining and prospecting rights along with the associated environmental rehabilitation liabilities. As with the sale of Finsch Mine to an empowerment consortium in 2011, the sale supports De Beers strategy in South Africa to divest of late-life mines in order to release capital for other sustainable, long-term investments. The Peace in Africa mining vessel charter arrangement with De Beers Marine Namibia (Debmarine Namibia) ended in November, and the vessel was subsequently sold to Debmarine Namibia. De Beers continues to view South Africa as prospective, and registered three prospecting rights in the Northern Cape, which were granted during the year. De Beers continues to fast track programmes dependent on the granting of exploration rights. ECOHS overview De Beers recorded 11 LTIs in 2012 (2011: six) and a LTIFR of 0.22 (2011: 0.10) in South Africa. No loss of life incidents occurred. During the year the company introduced a more robust health and safety data collection system and strengthened the reporting culture in line with its uncompromising commitment to Zero Harm. Since implementation of the Safety Risk Management Programme in 2010, 5,677 employees have been trained.

Phillip Barton, CEO, DBCM

 We are on course to secure the future of De Beers presence in South Africa by making a significant investment in Venetia Underground, improving efficiency, maximising our assets and identifying new opportunities. Our robust business model will drive sustainable operations beyond 2038.
In South Africa, De Beers operates through De Beers Consolidated Mines (DBCM), a 74/26 Black Economic Empowerment (BEE) partnership with Ponahalo Holdings. DBCM manages Venetia Mine, Voorspoed Mine and the Kimberley tailings dumps, and is in the process of selling Namaqualand Mines and the Rooipoort Mining Right to consortiums with strong BEE credentials. Operating highlights In 2012, De Beers recovered 4.43 million carats in South Africa (2011: 5.44 million). The reduced output was partly the result of the sale of Finsch Mine in September 2011, which contributed 0.94 million carats during 2011. De Beers mined 57 million tonnes of waste and ore in 2012 (2011: 49 million tonnes) and treated 14 million tonnes (2011: 16 million tonnes). Revised mining plans and the application of timely projects to accelerate production successfully improved wastestripping rates. However, production was nonetheless impacted by an industry-wide technical skills shortage and an unreliable supply of earthmoving equipment at Voorspoed and Venetia. An initiative undertaken with suppliers to boost the ecient use of such equipment resulted in incremental increases in output.

The current mining rights expire in 2038; Venetia Mine will apply to extend the mining rights at the appropriate time in the future.

12

Operating and Financial Review 2012 Production

2012 production statistics (000)


Mines Tonnes treated Carats recovered

Venetia Voorspoed Namaqualand (production suspended) Kimberley Total

5,618 2,797 0 5,276 13,691

3,066 611 0 755 4,432

Performance indicators
12 11 11/12

LTIFR LTISR Mining licence area (ha) Tonnes treated (000s) Carats recovered (000s)

0.22 5.06 1,005,730 13,691 4,432

0.10 2.60 1,005,730 15,525 5,443

0.12 2.46 0 -1,834 -1,011

All active operations retained the ISO14001 certication and no major environmental incidents were reported. OHSAS18001 certication was also retained across DBCM mines. The management of our employee health and surveillance remains eective, with no occupational disease recorded for 2012. The Namaqualand towns of Kleinzee and Koingnaas were proclaimed in 2012, having been closed mining towns since 1929 and 1970, respectively. Handover of the municipal services to the relevant local authorities remains on track for 2013. In June 2012, De Beers Zimele, the business enterprise initiative established in 2009 to support small enterprise and job creation, launched the Venetia Mine Hub. De Beers Zimele now includes ve business hubs in communities close to De Beers operations, aiming to fund and create 3,000 local jobs in start-up small, medium and micro businesses by 2015. To date, 1,240 jobs have been created. DBCMs corporate social investment programme covers a range of community, educational and environmental projects. Investment is made with due consideration of the needs and priorities of the local community, following extensive engagement with the community, NGOs and local government. The three primary focus areas are education, health and community strengthening. DBCMs HIV and Aids treatment programmes remain relatively static with a total of 265 members, of whom 56 percent were previously employees. In 2012, 25 new patients joined the programmes and four people resigned. Outlook In 2013, DBCMs Secure our Future strategy will focus on four areas: people, operations, continuous business improvement and asset optimisation. The sale of Namaqualand Mines will complete a programme of rationalisation and ensure that investment is concentrated on sustainable operations.
www.debeersgroup.com

Waste conveyor distribution house on top of the tailings dump, Venetia Mine.

13

Operating and Financial Review 2012 Production

Botswana
During the suspension of pit operations, production was sustained from surface ore, albeit at a lower rate. Jwaneng recovered 8.17 million carats, 23 percent less than in the prior year (2011: 10.64 million). This was mainly as a result of the slope failure. Debswana completed the Jwaneng Cut-8 infrastructure project on schedule, including the establishment and handover of workshops for earth-moving equipment. During 2012, 57 million tonnes of waste were moved (2011: 31 million tonnes). Cut-8 will provide access to approximately 95 million carats of mainly high quality diamonds in approximately 80 million tonnes mined6, and extend the life of the worlds richest diamond mine to at least 2028. Execution of the Modular Tailings Treatment plant commenced during 2012 with procurement of long lead items. Construction will continue through 2013. The Jwaneng Resource Extension Project is progressing, albeit slightly behind schedule due to the operational challenges at Jwaneng. Orapa, Letlhakane and Damtshaa Mines (OLDM): The OLDM complex produced 12.04 million carats during the year (2011: 12.25 million). Ore tonnes mined amounted to 16.7 million (2011: 16.2 million). Carat production includes 0.19 million carats from Damtshaa Mine which was on care and maintenance during 2011. Despite the loss of earthmoving equipment due to re, the mine plan was well executed. Resource extension projects for the Orapa, Letlhakane and Damtshaa Mines continued throughout the year and are on plan. Morupule Coal Mine: Following the successful completion of the Coal Mine Expansion Project during the year, a three-month technical completion test began in November. Production from the extended mine will supply thermal coal to the new Morupule B power station. The project, which started in 2010, has increased Botswanas coal mining capacity from one million tonnes to 3.2 million tonnes a year.

Jim Gowans CEO, Debswana Diamond Company

 We have made good progress in 2012, continuing Debswanas transformation journey to a cost-efficient and agile mining company. Following a slope failure at Jwaneng Mine, we reviewed our procedures and recommitted ourselves to a Zero Harm culture.
In Botswana, De Beers operates through Debswana, a 50/50 joint venture partnership between the Government of the Republic of Botswana and De Beers. Debswana operates the Jwaneng, Orapa, Letlhakane, and Damtshaa diamond mines and the Morupule Coal Mine, the sole operating coal mine in Botswana. Operating highlights Debswana recovered 20.22 million carats in 2012, down 2.67 million carats on the previous year (2011: 22.89 million). The company treated 21.87 million tonnes (2011: 22.89 million). The reduced carat yield was in part due to ore grade challenges in the treatment plants and delays in production due to a slope failure in June. During the year, Debswana bolstered its asset management plan to improve the availability of physical assets, minimise risk and identify cost eciencies. The benets are expected to come on stream in 2013. Jwaneng Mine: On 29th June, a slope failure at Jwaneng Mine tragically claimed the life of an employee. The company suspended mining from the pit for seven weeks to ensure the safety of our employees, and allow the Botswana Department of Mines to conduct formal investigations. Debswana immediately instigated its own technical studies to understand the root causes of the incident and assess various mining recovery options. All initial recommendations from internal and external investigations into safety procedures, slope monitoring processes and skills competency have been implemented.

2012 production statistics (000)


Mines Tonnes treated Carats recovered

Orapa Mine Letlhakane Mine Damtshaa Mine Jwaneng Mine Total

12,251 2,220 1,387 6,015 21,873

11,089 764 191 8,172 20,216

Performance indicators
12 11 11/12

LTIFR LTISR Mining licence area (ha) Tonnes treated (000s) Carats recovered (000s)

0.09 2.06 41,273 21,873 20,216

0.19 10.15 41,276 22,889 22,890

-0.10 -8.09 -3.00 -1,016 2,674

This estimate of carats contains Indicated (24%) and Inferred (76%) Resources. Not all Inferred Resources may be upgraded to reserves, even after additional drilling. Further details appear in the 2012 Anglo American Plc Annual Report.

14

Operating and Financial Review 2012 Production

It supports the countrys objective to generate sucient electricity for its own needs. Debswana made progress with a three-year strategy, launched in 2011, to transform the business into a more cost-ecient and agile mining organisation. The companys objective is to achieve global mining benchmark performance standards in all production and support areas by the end of 2013, and consistently deliver superior shareholder value. In 2012, initiatives were focused on improving performance in mining, treatment, maintenance and the supply chain. Achievements included implementation of a process to track production performance at shorter intervals so that deviations can be addressed rapidly, and a system to ensure that contractors deliver optimum value. ECOHS overview The year proved to be challenging with regard to safety. Regrettably, two loss of life incidents occurred in 2012 (2011: one). In March, an employee was struck by lightning at Jwaneng Mine. In June, a slope failure, also at Jwaneng Mine, resulted in the death of an employee. Debswana has an uncompromising stance on safety any injury is unacceptable. All the mines run initiatives to marshall employees behind a common culture of Zero Harm. A rigorous process is deployed to rapidly report and investigate every incident, identifying root causes, initiating remedial action and disseminating learnings. In 2012, the LTIFR was 0.09 (2011: 0.19). A total of 11 LTIs were recorded (2011: 13). The reduction of lost time injuries through engagement, training and culture change remains a priority. All mining operations retained their OHSAS18001 and ISO14001 certication in 2012. Debswanas corporate social investment programmes includes social, economic and environmental projects, spanning healthcare, community enrichment, arts and culture, entrepreneurship, education, sports development and eco-tourism. Debswana is the countrys largest private sector employer. Of the total workforce, over 95 percent of employees are Botswana citizens. Outlook Debswana will focus on implementing its enhanced asset management plan and a business-wide culture of safe, high performance. Improved waste stripping and the ecient use of machinery and equipment will position the company to respond to any upturn in demand.
www.debswana.com

Haul trucks at Orapa Mine.

15

Operating and Financial Review 2012 Production

Namibia
Namdebs commitment to sustainable post-mine land use was spearheaded in 2012 with the commencement of building work on a government-approved asbestos disposal facility at Southern Coastal Mines. The project combines bunker construction and land lling to safely remove the asbestos generated during the demolition of old redundant infrastructure. The facility remains on track for completion in 2013.
Inge Zaamwani-Kamwi CEO, Namdeb Diamond Corporation

 Our strategy to streamline production and chart unexploited potential, both on land and at sea, positions the business for the future.
In Namibia, De Beers operates through Namdeb Holdings (Pty) Limited, a 50/50 joint venture between the Government of the Republic of Namibia and De Beers. The core business is diamond exploration and mining along the south-western coast and inland areas of the Karas Region. Land operations are conducted by Namdeb Diamond Corporation (Proprietary) Ltd (Namdeb) and marine operations by De Beers Marine Namibia (Debmarine Namibia). Both are wholly owned subsidiaries of Namdeb Holdings. Operating highlights In 2012, Namdeb Holdings recovered 1.67 million carats (2011: 1.34 million) and treated 12.8 million tonnes of ore from 1.57 million hectares under licence (2011: 8.29 million tonnes under 1.57 million hectares). Debmarine Namibia produced a record 1.1 million carats from 10km of ocean oor (2011: 0.99 million carats from 8.1km2), despite adverse weather conditions at sea. Namdeb produced 0.56 million carats (2011: 0.35 million carats). Construction of the Red Area Complex at Southern Coastal Mines started in 2012. The complex is a state-of-the-art recovery and sorting facility and is expected to come on stream in the second half of 2013, replacing Mining Area 1s existing plant. The complex will deliver more secure and ecient processing of all land and marine production. Land operations: Elizabeth Bay Mine restarted operations in January, but experienced a delay in commissioning, in part due to technical challenges. The resulting lapse in production was oset by increased output from the Southern Coastal and Orange River Mines. Work continued on other extension projects, which are set to boost the life of conventional land operations to at least 2023. The US$34 million Sendelingsdrif Mine Project proceeded to plan. Sendelingsdrif is expected to replace production from Daberas Mine toward the end of 2013; from 2014 the mine will produce an estimated 45,000 carats annually from approximately 3.5 million tonnes mined, extending the Orange River operations to at least 20207.
16

Namdeb has developed systems and techniques to accelerate beach accretion, or the formation of areas of coastal sediment, in a bid to gain ground beyond current limitations. Programmes using the Beachcomber dredge and oating treatment plant in Southern Coastal Mines also progressed well. Marine operations: The strong production performance by Debmarine Namibia was mainly due to eciency improvements, new mining tools, and the early commissioning and ramp-up of the Grand Banks vessel, which was remobilised during the year following an extended lay-up. The sampling vessel, Coral Sea, continued to identify resources that will full the marine mining plan for at least two years. Coral Sea will continue sampling in 2013 to ensure sustainable growth in reserves and mine plan levels. The chartered vessel, Explorer, successfully tested a new sampling tool for use in coarse gravel and will again be chartered for 150 days in 2013 to conduct exploration sampling across Atlantic 1. In 2012, Peace In Africa was acquired from De Beers at a cost of US$79 million. Capacity enhancements to the Peace In Africa and the Debmar Atlantic will be implemented during 2013 to target currently un-mineable areas within Atlantic 1. The revision of the eet maintenance strategy is in progress, in line with industry best practice asset management principles. Both land and marine operations negotiated two-year wage agreements with the Mineworkers Union of Namibia in 2012.

2012 production statistics (000)


Mines Tonnes treated Carats recovered

Alluvial Contractors Elizabeth Bay Mining Area 1 Orange River Atlantic 1 Total

N/A 1,672 6,959 4,178 N/A 12,809

22 210 252 76 1,107 1,667

Performance indicators
12 11 11/12

LTIFR LTISR Mining licence area (ha) Tonnes treated (000s) Carats recovered (000s)
7

0.20 5.06 1,578,908 12,809 1,667

0.17 5.31 1,578,908 8,288 1,335

0.03 -0.25 0 4,521 332

The mining licence expires in 2020. Further details appear in the 2012 Anglo American Plc Annual Report.

Operating and Financial Review 2012 Production

Project 2050, a land mining plan initiated in 2010, sets a course for long-term protable diamond production in Namibia. Following several years of planning and investment, both land and marine operations now have a good understanding of the unexploited ore bodies within licence areas. Namdeb Holdings operates an innovative o-shore probe drilling system to explore marine sites adjacent to land-based activities, and continues to research advanced equipment for both on- and o-shore operations. ECOHS overview Tragically, one loss of life incident occurred at Southern Coastal Mines following a vehicle accident in March. Vehicle accidents are Namdeb Holdings number one safety risk, with eight recorded in 2012 (2011: seven). During the year, a reinforced safety improvement plan was launched and employees attended Safety Risk Management training. Five LTIs were recorded (2011: four). The LTIFR rose to 0.20 (2011: 0.17). All operations retained OHSAS18001 and ISO14001 certication. Namdeb Holdings HIV and Aids management programme continued in 2012. Since 2004, employees and their partners have had access to free anti-retroviral therapy. HIV and Aids prevalence surveys are conducted on-site every two years, in addition to regular screening for early identication of chronic and acute illness. Namdeb Holdings corporate social investment programme supports education, sustainable tourism and national heritage projects. In 2012, Namdeb Holdings facilitated the proclamation of Oranjemund, a formerly closed town, wholly managed by Namdeb and established in 1936 for employees to live near the mining area. A town council was elected and in 2013 Namdeb Holdings will continue to support the development of infrastructure and municipal services. Outlook In the coming year, Debmarine Namibia will look to increase operational eciencies through the advancement of exploration sampling and the implementation of new resource models and technological improvements to mining tools and technical systems. Namdeb will continue to focus on maturing the 2050 vision through ongoing exploration, sampling, beach accretion and development of technologies to mine the mid-water. As land and marine extension projects gather momentum, the company is condent it will secure capital for future development and return long-term shareholder value.
www.debeersgroup.com

The Debmar Atlantic mining vessel, moored o the Namibia coastline.

17

Operating and Financial Review 2012 Production

Element Six
Construction of the worlds largest diamond supermaterials research and development facility in Oxford, UK, began in May. The Global Innovation Centre on schedule to open in 2013 will provide a world-class research environment for E6 scientists, engineers and technicians, as well as create over 50 new jobs. In the UK, E6 won the prestigious 2012 Queens Award for Enterprise in Innovation for its partnership with the British audio brand Bowers & Wilkins. The award recognised the commercial development of a synthetic diamond tweeter dome used in the Bowers & Wilkins Diamond 800 Series range of speakers. LEAN and Six Sigma methodologies were further implemented globally to encourage manufacturing excellence at lower cost. The multi-year programme increased oil and gas yields and manufacturing velocity, as well as providing signicant improvements to E6s single crystal production process in 2012. ECOHS overview E6 recorded an LTIFR of 0.23 in 2012 (2011: 0.42). LTIs dropped for the fourth consecutive year to a record low of six (2011: 12). This follows the implementation of a new safety culture in 2008 that instigated systematic safety trainings, established safety best practices and employee empowerment, as well as ubiquitous reporting across the Group. E6 aspires to Zero Harm and will maintain a critical focus on health and safety through 2013 to keep the momentum going. There were no major environmental issues in 2012. All main operations hold ISO18001 certication and most are ISO14001 certied. Outlook The supermaterials landscape is expected to remain challenging in 2013 due to uncertain end-market conditions. In this context management is taking measures to further optimise operations as well as reduce costs without jeopardising strategic priorities. E6 is condent that its investments and leadership in innovation, product portfolio, manufacturing and world-class customer service position it well for future growth.
www.e6.com

Cyrus Jilla CEO, Element Six

 2012 was a challenging year, with trading slowing sharply in the second half. E6 focused on cost reductions while delivering a record year for safety and making strong progress on strategic priorities.
Element Six (E6) supermaterial solutions are used in applications such as cutting, grinding, drilling, shearing and polishing, while the extreme properties of synthetic diamond beyond hardness are already opening up new applications in a wide array of industries such as optics, power transmission, water treatment, semiconductors and sensors. Operating highlights While performance varied across E6s four divisions, overall sales declined marginally in 2012, reecting weaker demand and volatility in a number of key end-user industries (including automotive, personal electronics and photovoltaic). In response, E6 focused on cost containment and made signicant progress against strategic objectives: the business continued to develop geographic reach, manufacturing excellence, product innovation and a culture of behavioural-based employee safety. Progress in 2012 focused on a platform of capabilities and growth opportunities that position E6 well for the future. In 2012, E6 opened its rst US manufacturing facility in Silicon Valley, Santa Clara, from which new commercial applications for chemical vapour deposition (CVD) technology will be produced. It also successfully brought to market a new diamond-tipped road maintenance pick (D-Power), which extends the life of standard picks more than 40 times and provides numerous further benets to customers. The business also continued to build its share in a number of key regions, most notably North America and Asia. At the end of the year, E6 acquired Schlumbergers Megadiamond cutting tools business, strengthening its leadership in precision machining.

Road-milling drum equipped with E6 diamond-tipped DPower road picks.

18

Operating and Financial Review 2012

Rough diamond sales


Global Sightholder Sales
In 2012, as part of the relocation, De Beers successfully transferred its aggregation, quality assurance and Sight preparation functions to Botswana, two months ahead of schedule. The business remains on track to complete migration by the end of 2013. Thereafter, all sales to international Sightholders, and domestic Botswana Sightholders, will be carried out in Gaborone.
Varda Shine Executive Vice President, Global Sightholder Sales

 We continued to evolve our rough diamond distribution strategy, while delivering the first phases of the migration of our London-based sales activities to Botswana.
De Beers is the worlds largest supplier of rough diamonds, by value. With activities in sorting, valuing, sales and diamond beneficiation, it operates in the UK and South Africa, and through 50/50 joint ventures with the Governments of the Republics of Botswana and Namibia, respectively. Operating highlights Global sales were US$5.5 billion in 2012 (2011: US$6.5 billion). The decrease in sales was a result of diminished demand and changing product requirements from Sightholders, as well as reduced availability of some goods. Against a backdrop of macroeconomic uncertainty, the industry was impacted by constrained liquidity in the midstream, high cutting centre inventories and changing retailer stocking patterns. Of total global sales, US$1.1 billion was sold in-country (2011: US$1.2 billion). This was in line with De Beers beneciation commitments to producer governments, which recognise the need to create shared value from diamonds through sustainable partnerships. Botswana is a prime example of how long-term partnerships can create mutual value. The strength of the partnership between DeBeers and the Government of the Republic of Botswana was rearmed through the signing of a 10-year agreement in September 2011 for the purchase of Debswanas production. The agreement underpins Botswanas strategy to build a sustainable downstream diamond economy and secures De Beers continued access to the largest supply of diamonds in the world. As part of the milestone agreement, De Beers agreed to transfer its London-based rough diamond sales activity, including professionals, skills, equipment and technology, from London to Gaborone by the end of 2013.

In March, De Beers began a new three-year Supplier of Choice contract period, and introduced an updated allocations and replanning process. The updated process will see customers demonstrated demand have more inuence on their allocations of rough diamond supply during the contract period. ECOHS overview Global Sightholder Sales UK operations maintained ISO14001 and OHSAS18001 certication in 2012. Global Sightholder Sales in South Africa retained ISO14001 certication and is working toward OHSAS18001 certication. Once OHSAS18001 has been obtained at DTC Botswana (DTCB) and Namibia DTC, attention will turn to achieving ISO14001. There were three LTI incidents at DTCB in 2012, but none of the other entities in the Global Sightholder Sales network reported any LTIs in the year under review. Outlook The rough diamond manufacturing sector closed 2012 with reportedly high levels of inventory, particularly in the higher-end categories of diamonds, and faces continued pressure in terms of liquidity. In the medium to long term, industry fundamentals are expected to strengthen as diamond production plateaus and demand continues to increase. De Beers expects moderate growth in diamond jewellery demand in 2013. This will be supported primarily by a more positive picture emerging from China. Some upside is possible in the US, while trading conditions in other markets are likely to be challenging. De Beers will complete the migration of its Londonbased sales activities to Botswana by the end of the year, supporting the transformation of Botswana into a leading diamond centre and bringing broader benets to the southern Africa region.
www.debeersgroup.com

A senior sorter inspects diamonds at Harry Oppenheimer House, Kimberley.

19

Operating and Financial Review 2012 Rough Diamond Sales

Auction Sales
Competition in the provision of short-term rough diamond buying opportunities is intensifying as more players adopt the auction sales and pricing approach. De Beers strategy is to build further capability and add value for customers in existing and new markets. In 2012, the business scaled back its trading activities following the 2011 expansion of customer viewing facilities in Antwerp, Israel and Hong Kong and the opening of a new oce in Dubai. With a strengthened global team also in place, Auction Sales is well equipped to support customers with timely information, sales completions and follow through. These developments position the business well to capture spot sale prices that better reect short-term global supply and demand. Cost management was an important focus in 2012. Even so, planning went ahead on a number of strategic initiatives to strengthen the business in 2013 and beyond. ECOHS overview Auction Sales reported no LTIs in 2012 (2011: 0). Outlook Macroeconomic challenges continue to unsettle demand for rough diamond products. However, a strong pipeline of innovation such as enhancements to the sales mix and improved buyer support should bear fruit in 2013, and buoy demand for De Beers products. The outlook, though cautious, remains optimistic.
www.diamdel.com

Neil Ventura Senior Vice President, Auction Sales

 Following a year of record results and expansion in 2011, we moderated our trading activities in 2012 in light of subdued buyer demand, and pursued plans to boost performance in the years to come.
De Beers is a market leader in rough diamond spot sales. Competitive sales involve small, medium and large manufacturing, retail and trade business buyers worldwide, optimising an industry-first online auction capability. De Beers Auction Sales is headquartered in Antwerp, with additional offices in Tel Aviv, Hong Kong and Dubai. Operating highlights Following exceptional demand for rough diamonds in 2011, and record revenues for Auction Sales, sustained growth proved more challenging in 2012. Demand improved steadily in the rst quarter, with India-based buyers accounting for the most robust growth. This trend cooled over the year, however, mainly due to global economic uncertainty. Auction Sales achieved revenues of US$356 million in 2012 (2011: US$405 million), down 12 percent. The decrease in sales was as a result of subdued buyer activity. De Beers ran 151 online auctions in 2012 (2011: 134) and presented 3,807 lots for sale (2011: 2,614). Lots featured rough diamonds spanning the full product range in terms of size, colour, quality and shape. Auctions attracted bids from 331 business buyers (2011: 281), with 235 discrete winners emerging (2011: 182). De Beers pioneered online international auctions of rough diamonds in January 2008 when it introduced auction sales in addition to traditional direct sales. Since then, it has secured bids from 504 dierent companies, of which 357 have been successful.

Rough diamonds being prepared for Auction Sales viewings.

20

Operating and Financial Review 2012

Brands
Forevermark
Forevermarks promise that each diamond is beautiful, rare and responsibly sourced was brought to life publicly through an integrated PR, advertising, online marketing and in-store merchandising campaign. Designed to build consumer anity, the messaging focused on the promise behind each Forevermark diamond and the signicant promise moments in consumers lives. Forevermarks rst TV advertisements were aired in India and the US, helping to increase consumer awareness by nearly 25 percent in India, with visits to www.forevermarkdiamonds.com in the US increasing more than tenfold between October and December 2012. ECOHS overview De Beers commitment to the communities and countries in which it mines is exemplied by Forevermark, which accredits only diamonds from sources that adhere to the brands high business, social and environmental standards. Less than one percent of the worlds diamonds are eligible for the Forevermark programme. Every Forevermark diamond is crafted by a select diamantaire, who undergoes annual third-party independent audits. Collections are exclusively available through carefully selected authorised Forevermark jewellers, which are also required to comply with the brands standards. In 2012, Forevermark again maintained ISO18001 certication and reported zero LTIs. Outlook Forevermark will continue to build brand awareness and consumer demand while expanding to more cities, particularly in China, India and the US. The successful licensee model is forecast to open doors in several new markets, raising the brands availability by approximately 25 percent globally in 2013.
www.forevermark.com

Stephen Lussier CEO, Forevermark

 Consumers place great faith in our promise that each Forevermark diamond signifies beauty, rarity and responsible sourcing. The brands standards of quality and integrity helped differentiate our growing presence in established and new markets.
Forevermark is the proprietary diamond brand, and the principal consumer marketing arm, of the De Beers Group of Companies. Available through authorised jewellers around the world, each Forevermark diamond is inscribed with the brand icon and a unique identification number providing evidence that it has met the brands high standards of quality and provenance. The patented inscription technology was developed by the De Beers research and development team. Operating highlights Forevermark strengthened its footing in core markets in 2012. The number of stores licensed to retail Forevermark diamonds grew by 40 percent to over 900 higher-end jewellers worldwide. The brand expanded its presence in the existing core markets of China and Japan, cemented its entry to the US and India, and launched into two new licensee markets: Canada and the United Arab Emirates. The licensee model continued to support entry into new markets, with appointment of the Middle Easts leading international jeweller Damas as exclusive Authorised Forevermark Jeweller in the UAE. In Canada, 28 jewellers were selected as the rst retailers to carry Forevermark diamonds. The Forevermark Diamond Institute in Antwerp responded to growing global consumer demand by signicantly increasing its inscription and grading capacity. Extended production areas facilitated a rapid lift in grading (51 percent) and inscription outputs (33 percent). The Forevermark Diamond Institute continues to invest in research and development, enabling it to detect all synthetic and treated gems, and delivering on the promise of a fully natural diamond.

The Forevermark inscription, unique to each Forevermark diamond.

21

Operating and Financial Review 2012 Brands

DeBeers Diamond Jewellers


DBDJ creates designs that express the natural beauty and timeless quality of the diamond, and is strategically positioned as The Jeweller of Light. The company commissioned London-based designer Rolf Sachs to create a store window concept encapsulating the brands image for the 2012 festive season. Titled Breathing Light, the display featured in stores globally after making its debut in London.
Franois Delage CEO, De Beers Diamond Jewellers

 After a year of strong growth in 2011, we consolidated our global presence, successfully launched a new high jewellery collection, and continued to build the brands image as the Jeweller of Light.
De Beers Diamond Jewellers (DBDJ) is an independently managed 50/50 joint venture partnership between De Beers and LVMH Mot Hennessy Louis Vuitton SA. The global DBDJ network consists of 43 stores across 13 countries. Operating highlights DBDJ strengthened a growing presence in continental China in 2012 with its rst store openings in Shanghai and Nanjing. The company is well placed to meet strong demand for luxury diamond jewellery in China following inaugural store launches in Beijing, Dalian and Tianjin during 2011. The brand renovated and repositioned stores to better engage with the market, including the companys assets at Shinjuku Isetan in Tokyo and Harrods in London. DBDJ closed stores on Rodeo Drive (Los Angeles) and at Royal Exchange (London), as well as its franchised outlet in Kiev (Ukraine). The network now numbers 14 stores in East Asia, 10 across the US, nine in Japan, seven in Europe and three in the Middle East. The brand continued to communicate its international reputation for expertise, old traditions and a contemporary creative vision. DBDJ unveiled Imaginary Nature, a new high jewellery collection of eight unique pieces inspired by the natural world. In addition, the existing lines of Aura, Adonis Rose, Azulea and Enchanted Lotus remained popular and proved strong sellers in 2012. In the UK, DBDJ created the diamond-studded Talisman Crown in celebration of The Queens Diamond Jubilee. The crown features a mix of 974 rough and polished diamonds and a 73 carat diamond centerpiece. It was exhibited at Harrods before touring DBDJ stores in London, Beijing, Shanghai, Hong Kong and New York.

ECOHS overview DBDJ received full certication to Responsible Jewellery Council (RJC) standards in January 2012. RJC certication enables DBDJ to demonstrate this commitment at a time when more consumers demand assurance of the integrity of the supply chain. Outlook DBDJ will continue to deploy select store openings, relevant marketing and targeted customer promotion to build future growth. New franchise stores will open in Azerbaijan, Malaysia and Canada in early 2013. An ongoing priority is to maximise returns from existing stores and closely manage inventories, costs and working capital. The companys strategy is to become the denitive diamond jewellery destination, both for solitaires and image collections, while growing its credentials in High Jewellery.
www.debeers.co.uk

Imaginary Nature, the new High Jewellery collection by De Beers.

22

Operating and Financial Review 2012

Financial and production highlights


2012 snapshot
For the year ended 31December 31 December 2012 US$m 31 December 2011* US$m Variance %

Total sales EBITDA Operating profit Underlying earnings** Free cash flow Net interest bearing debt (excluding shareholders loans)

6,074 1,075 815 506 697 722

7,262 1,763 1,491 993 816 1,177

-16 -39 -45 -49 -15 -39

* Comparatives have been restated following changes in accounting policy for joint ventures and employee benefits. ** Underlying earnings is profit for the financial year attributable to equity shareholders of the Company before special items and remeasurements.

Production statistics
31 December 2012 Tonnes (000) 31 December 2011 Tonnes (000)

Total tonnes treated South Africa Kimberley Mines and Contractors Venetia Mine Voorspoed Mine Finsch Mine Namaqualand Mines and Contractors Namibia Land Sea Botswana Jwaneng Mine Orapa Mine Letlhakane Mine Damtshaa Mine Canada Snap Lake Mine Victor Mine

52,340 13,691 5,276 5,618 2,797 12,809 12,809 N/A 21,873 6,015 12,251 2,220 1,387 3,967 918 3,049
31 December 2012 Carats (000)

50,247 15,525 4,834 5,189 2,434


3,068

8,288 8,288
N/A

22,889 6,537 13,250 3,102

3,545 814 2,731


31 December 2011 Carats (000)

Carats recovered South Africa Kimberley Mines and Contractors Venetia Mine Voorspoed Mine Finsch Mine

Namaqualand Mines and Contractors


Namibia Land Sea Botswana Jwaneng Mine Orapa Mine Letlhakane Mine Damtshaa Mine Canada Snap Lake Mine Victor Mine

27,875 4,432 755 3,066 611 1,667 560 1,107 20,216 8,172 11,089 764 191 1,560 870 690

31,328 5,443 778 3,147 580 938 1,335 345 990 22,890 10,641 11,158 1,091 1,660 881 779

23

Operating and Financial Review 2012

Governance and risk


De Beers Socit Anonyme (the Company, or De Beers) was formally incorporated in the Grand Duchy of Luxembourg in November 2000. It is the holding company of all De Beers Group operations.
The Company is managed and controlled from its head office in Luxembourg where the Board and Executive Committee meet to attend to the business of the Group. Its commercial activities are carried out by a number of subsidiaries, investments and joint ventures, which it finances in different parts of the world. Together, these subsidiaries, investments and joint ventures constitute the De Beers Group of Companies. Taxes and royalties to governments are paid by each of the dierent subsidiaries and joint ventures in a manner consistent with the requirements of the jurisdiction in which they operate. De Beers prepares annual independently audited statutory accounts of both the Company and the Group in accordance with International Financial Reporting Standards. These are lodged with the Registre du Commerce and other authorities in Luxembourg, as well as being sent to each of the shareholders directly. These accounts are submitted to the Annual General Meeting of shareholders of the Company, held in March each year. Appointment of Board members The Articles of Incorporation relate to the legal establishment and registration of De Beers as a joint stock corporation in Luxembourg. As the legal constitutional instrument, it allows for a minimum of three and a maximum of 20 directors. The shareholders are responsible for the appointment and removal of directors in accordance with the provisions of the Shareholders Agreement and the Articles of Incorporation. The shareholder groups of Anglo American plc and the Government of the Republic of Botswana are entitled to nominate four and two persons respectively, for appointment to the Board. Accordingly, six directors, all of whom are non-executive directors, including the current Chairman, have been appointed as directors after their nomination as such by the shareholders. Additional directors may be appointed by the shareholders by majority consent or majority vote at the Annual General Meeting of shareholders, up to the maximum of 20 directors. Two non-executive directors have been appointed to the Board in this manner. Composition and independence As of 31 December 2012, the De Beers Board consisted of 11 directors. Of them, eight are non-executive directors and three serve in executive capacity and are members of the Executive Committee. The role of Chairman, a non-executive director, is quite distinct from that of the Chief Executive Ocer. During 2012, Nicky and Jonathan Oppenheimer, Mark Berry, Baron David de Rothschild and James Teeger resigned from the Board. Brian Beamish and Peter Whitcutt joined the Board on 28 September 2012. Mr J S Iita, representing the Government of the Republic of Namibia (GRN), also resigned as a member of the Board with eect from 26November 2012. The GRN, acting under the provisions of the Diamond Sorting, Valuing, Sales and Marketing Agreement dated 18May 2011 between the GRN, the company and other parties,

Fitter operators working on a pump bearing assembly, Voorspoed Mine.

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Operating and Financial Review 2012 Governance and risk

nominated Mr K Kahuure as a director of the Company and he was appointed as such by the Board with eect from 27November 2012. Structures under the Board In 2008, the Board adopted a Board Charter which, among other things, sets out the mandate of the Board and those powers reserved to it. The Board is responsible for the Groups system of governance and is ultimately accountable for the strategic direction of the business and all activities across the Group. This includes setting risk management policy, reviewing the eectiveness of risk management processes, recommending enhancements and ensuring eective succession planning. It also provides oversight of, and consultation to, the dierent business entities across the De Beers Group of Companies on governance structures and on the identication, appointment and training of directors. The De Beers Board is supported in its decision-making by six committees: the Executive Committee, the Audit Committee, the ECOHS Committee, the Investment Committee, the Remuneration Committee and the Treasury Committee. Although not an ocial committee under the Board, the Principles Committee provides further review and scrutiny on the extent to which the De Beers Group of Companies contributes to sustainable development and operates in conformance with its principles.

 The shareholders and Board recognise that engaging risk is at the core of the business. The Board reviews reputation and sustainability performance and risks on, at least, an annual basis in line with the formal risks review process.
Risk management The shareholders and Board recognise that engaging risk is at the core of the business. The Board reviews reputation and sustainability performance and risks on, at least, an annual basis in line with the formal risk review process. Detail on these risks is presented in the introductory statement of the Chairman and performance review of the Chief Executive Ocer, as well as in our Report to Society 2012, which will be published in May 2013. De Beers is governed by a risk framework through which risks are proactively identied, engaged and managed. This includes taking advantage of opportunities and protecting capital, talent management, income and assets by mitigating the adverse impacts of risk.

The DTCB building, Gaborone.

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Operating and Financial Review 2012

Sustainability
Operating in a responsible and sustainable manner requires a balance between delivering good nancial returns, and addressing the risks that may aect the sustainability of the business and societies in which we work.
Contributing to sustainable development Our understanding of sustainability is shaped by the societal imperatives of our partner governments and communities. This includes helping to dene the role of business in contributing to a vision of an ever more prosperous Africa, and supporting sustainable partnerships in Canada. We aim to maximise our contribution to sustainable development through beneciation activities to support downstream diamond sector activity in producer countries, community social investment, and local enterprise generation through preferential procurement. Our approach to sustainability is focused on managing and mitigating those risks that can aect our commercial interests by impacting on our access to supply or undermining consumer condence in diamonds. These risks relate primarily to: ensuring our social licence to operate, conict diamonds, social and environmental conditions in mining and cutting and polishing operations, the use of diamonds by criminal syndicates, and issues around product integrity. Managing sustainability risks We prioritise and categorise sustainability risks into ve key areas: economics, ethics, employees, communities and environment. Extensive stakeholder engagement processes help us to assess the relevance and materiality of each risk and to develop appropriate management responses. Ongoing stakeholder engagement is one element of a broader sustainability management framework, which also includes the Principles Committee, the Environment, Community, Occupational Health and Safety (ECOHS) Committee (at Board level) and local ECOHS functions (operating at business and community level). The Principles Committee is a management committee that provides guidance and oversight to the Executive Committee and Business Unit CEOs to ensure that the De Beers Group of Companies engages proactively with sustainability issues and related long-term risks. The ECOHS Committee and associated peer groups act in the same way, providing strategic direction and assurance on ECOHS disciplines to the business units. Our Best Practice Principles Assurance Programme (BPPs) also drives sustainability performance by providing a comprehensive third-party veried assurance programme to ensure the eective management of key risks. The BPPs outline strict requirements regarding compliance to the Kimberley Process and associated System of Warranties. They also set out clear minimum standards of performance against a range of other criteria including social, environmental, labour, and health and safety standards, and product integrity requirements including the disclosure of synthetics, treatments and simulants. All entities within the De Beers Group of Companies, as well as all Sightholders and signicant contractors, are required to comply with the BPPs.

Extensive stakeholder engagement processes help us to assess the materiality of sustainability issues and to manage them appropriately.
Annual Report to Society More information on our sustainability approach can be found in our award-winning annual Report to Society, which can be accessed at www.debeersgroup.com/sustainability. The 2012 Report to Society will be available online and for order in hard copy from May 2013.

White rhinos at Orapa Game Park Makgadikgadi, which became part of the Diamond Route in March 2012.

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Operating and Financial Review 2012

The Board and executive management


Cynthia Carroll MSc, MBA Chairman Born in 1956, Cynthia Carroll is Chief Executive of Anglo American plc. She was appointed to the Board of De Beers on 1 March 2007 by the Anglo American shareholder, and became Chairman on 28 September 2012. Currently she is Board Chairman of Anglo American Platinum, a member of the Board of BP plc. and a director of DB Investments. Brian Beamish BSc (Mechanical Engineering) Born in 1956, Brian Beamish is Group Director, Mining and Technology at Anglo American plc. He was appointed as non-executive director to the Board of De Beers on 28 September 2012 by the Anglo American shareholder. He is also a director of DB Investments. He is a member of the Anglo American Safety and Sustainable Development and Investment Committees. Mr Beamish has more than 35 years of mining industry experience in various commodities and geographies and spent over 20 years at Anglo American Platinum, including four years as executive director of operations, between 1996 and 1999.

Bruce Cleaver BSc Applied Maths, LL.B Born in 1965, Bruce Cleaver was appointed to the Board on 23 July 2008. Mr Cleaver is Executive Head, Strategy and Corporate Aairs for the Group, and is currently responsible for strategy, commercial and legal matters as well as Exploration. He holds directorships within the Group, including De Beers Consolidated Mines Proprietary Limited and Namdeb Holdings (Proprietary) Limited, and serves on the Executive, Investment and Treasury Committees.

Ren Mdori PhD Born in 1957, Ren Mdori was appointed to the Board of De Beers on 7 February 2007, by the Anglo American shareholder. He is the Finance Director of Anglo American plc, and a director of Anglo American Platinum , DB Investments and Petrofac Limited.

Philippe Mellier BMEng, MBA Born in 1955, Philippe Mellier was appointed to the Board on 19 July 2011, following his appointment as Chief Executive Ocer of De Beers in May 2011. Mr Mellier holds directorships across the Group, including De Beers Consolidated Mines Proprietary Limited, De Beers Diamond Jewellers Limited, Debswana Diamond Company (Proprietary) Limited and Namdeb Holdings (Proprietary) Limited. He chairs Element Six SA and Element Six Abrasives SA as well as the De Beers Executive and Investment Committees, and is a member of the ECOHS Committee.

Gareth Mostyn BA (Hons), ACA Born in 1972, Gareth Mostyn was appointed to the Board on 8 February 2012. A qualied Chartered Accountant, Mr Mostyn joined De Beers as the Chief Financial Ocer in January 2012. Mr Mostyn is also a director of De Beers Consolidated Mines Proprietary Limited, Debswana Diamond Corporation (Proprietary) Limited, Element Six SA, Element Six Abrasives SA and De Beers Diamond Jewellers Limited, and serves on the Executive, Investment and Treasury Committees.

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Operating and Financial Review 2012 The Board and executive management

Kahijoro Kahuure MSc Born in 1959, Kahijoro Kahuure was appointed to the Board on 27 November 2012, having been nominated by the Government of the Republic of Namibia, where he is Permanent Secretary, Ministry of Mines and Energy. He is also a Commissioner of the Permanent Okavango River Water Commission (OKACOM), the leader of the Namibian Delegation to the OrangeSengu River Basin Commission (ORASECOM) and the Vice Chairman of the Executive Board of the Centre for Technical Agriculture and Rural Cooperation in Wageningen, Holland.

Boikobo Paya BSc, MPhil Born in 1964, Boikobo Paya was appointed to the Board on 17 November 2010 by the Government of the Republic of Botswana shareholder group, where he is the Permanent Secretary, Ministry of Minerals, Energy and Water Resources. He serves on the ECOHS Committee and is a director of DB Investments, Debswana Diamond Corporation (Proprietary) Limited and DTC Botswana (Proprietary) Limited.

Barend Petersen B Compt (Hons), CA (SA) Born in 1960, Barend Petersen was appointed to the Board on 6 February 2008, elected by majority consent of shareholders at the AGM. He is the Executive Chairman of De Beers Consolidated Mines Proprietary Limited and chairs the ECOHS Committee. Mr Petersen is also a director of Anglo American South Africa and Alexander Forbes Equity Holdings.

Solomon Sekwakwa BA, MA Born in 1960, Solomon Sekwakwa was appointed to the Board on 4 February 2009 by the Government of the Republic of Botswana shareholder group. Mr Sekwakwa is the Permanent Secretary, Ministry of Finance and Development Planning, Government of the Republic of Botswana. He serves on the Investment Committee, and is a director of DB Investments and Debswana Diamond Corporation (Proprietary) Limited. Mr Sekwakwa is also a director of the Bank of Botswana and the Botswana Development Corporation.

Peter Whitcutt BCom (Hons), CA (SA), MBA Born in 1965, Peter Whitcutt is Group Director, Strategy and Business Development at Anglo American plc. He was appointed as nonexecutive director to the Board of De Beers on 28 September 2012 by the Anglo American shareholder. He is the Chairman of the De Beers Audit Committee and a member of the Investment Committee. He is also a director of DB Investments. He joined Anglo American in 1990 within the corporate nance division and worked on the merger of Minorco with Anglo American, the listing of Anglo American in 1999 and the subsequent unwinding of the cross holding with De Beers. Mr Whitcutt was appointed group head of nance in 2003, CFO of Base Metals in August 2008 and to his present position in October 2009.

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Operating and Financial Review 2012

Executive committee

Philippe Mellier, Chairman CEO, De Beers

Phillip Barton CEO, DBCM

Athene van Mazijk Executive Head, Human Resources, De Beers

Bruce Cleaver Executive Head, Strategy and Corporate Aairs, De Beers

Jim Gowans CEO, Debswana

Tony Guthrie CEO, Mining, Canada

Cyrus Jilla CEO, Element Six

Stephen Lussier Executive Vice President, Marketing, De Beers

Pat Lowery Executive Head, Technical, De Beers

Gareth Mostyn CFO, De Beers

Varda Shine Executive Vice President, Global Sightholder Sales

Inge Zaamwani-Kamwi CEO, Namdeb

Other committees
ECOHS Committee Barend Petersen, Chairman Dorian Emmett (co-opted) Samantha Hoe-Richardson (co-opted) Philippe Mellier Boikobo Paya Investment Committee Philippe Mellier, Chairman Bruce Cleaver Gareth Mostyn Solomon Sekwakwa Peter Whitcutt Remuneration Committee Chris Corrin (co-opted), Chairman Cynthia Carroll Mervyn Walker (co-opted) Audit Committee Peter Whitcutt, Chairman Solomon Sekwakwa Ian Botha (co-opted) Treasury Committee Gareth Mostyn, Chairman Mike Changfoot Bruce Cleaver Bernard Olivier Adrian OSullivan Doug Smailes (co-opted)

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Contact us
Angola De Beers Angola Prospecting, Ltd Caixa Postal no 4031 Luanda - Angola Tel: +244 (0) 222 63 8800 Fax: +244 (0) 222 63 8861 Botswana De Beers Holdings Botswana Main Mall PO Box 404331 Gaborone Tel: +267 (0) 361 5200 Fax: +267 (0) 395 9106 De Beers Botswana Debswana House Main Mall Private Bag 00380 Gaborone Tel: +267 (0) 390 2991 Fax: +267 (0) 390 2990 DeBeers Prospecting Botswana Debswana PO Box 404331 Gaborone Tel: +267 (0) 391 9962 Fax: +267 (0) 395 9106 Debswana Diamond Company PO Box 329 Gaborone Tel: +267 (0) 361 4200 Fax: +267 (0) 3180778 Diamond Trading Company Botswana Private Bag 0074 Gaborone Tel: +267 (0) 364 9000 Fax: +267 (0) 395 1150 Canada DeBeers Canada 900-250 Ferrand Drive Toronto, ON M3C 3G8 Tel: +1 (0) 416 645 1710 Fax: +1 (0) 416 429 2462 India DeBeers India Advanced Business Centre 83 Maker Chambers VI Nariman Point, 400 021 Mumbai Tel: +91 (0) 22 2283 2971/27 Fax: +91 (0) 22 2283 2823 Luxembourg DeBeers Socit Anonyme BP591, L-2014 Luxembourg Tel: +352 (0) 264 8711 Fax: +352 (0) 264 871 303 Namibia Namibia Diamond Trading Company PO Box 23316, Windhoek, 9000 Tel: +264 (0) 61 204 3222 Fax: +264 (0) 61 204 3263 Namdeb Diamond Corporation PO Box 1906 Windhoek, 9000 Tel: +264 (0) 61 204 3333 Fax: +264 (0) 61 204 3334 De Beers Namibia PO Box 23132 Windhoek, 9000 Tel: +264 (0) 61 204 3444 Fax: +264 (0) 61 204 3445 South Africa DeBeers Consolidated Mines PO Box 616 Kimberley, 8300 Tel: +27 (0) 53 839 4111 Fax: +27 (0) 53 839 4210 DeBeers Consolidated Mines Corporate Headquarters Cnr. Diamond Dr. and Crownwood Rd. Theta/Booysen Reserve, 2013 Johannesburg Gauteng Tel: +27 (0) 11 3747000 Diamond Trading Company (SA) Harry Oppenheimer House Hentrich Street Kimberley Northern Cape 8301 Tel: +27 53 830 7200 Fax: +27 53 832 4911 United Kingdom DeBeers UK Ltd, Global Sightholder Sales, Auction Sales and Forevermark 17 Charterhouse Street London ECIN 6RA Tel: +44 (0) 20 7404 4444 De Beers Diamond Jewellery 45 Old Bond Street London W1S 4QT Tel: +44 (0)207 758 9700 Element Six 3rd Floor, Building 4 Chiswick Park 566 Chiswick High Road London W4 5YE Tel: +44 (0)208 742 4900