The miner’s price target was also doubled to 60p from 30p after the Letseng mine went back to full production and the company returned to a net cash position of US$1mln for the first time since 2018.
The Lesotho mine is now back to full ore mining and treatment capacity, having started a phased ramp up in the second quarter.
Gem Diamonds achieved third-quarter pricing of US$2,215 per carat, well above the US$1,417 per carat seen in the same period in 2019, “strongly outperforming a troubled market” according to analysts.
The increase was driven by both a strong set of large stone recoveries, as the company found over five diamonds greater than 100 carats in the period, while there was a shortage of goods in the categories that they produce.
Despite the COVID-19 restrictions, the company is expected to achieve the mid-point on guidance of 96-100,000 carats, having recovered 72,403 carats in the year to date.
“It has been the best amongst the juniors and if it continues to manage costs and recover large stones, it will outperform its peers,” analysts commented.
Shares advanced 2% to 36.39p on Wednesday morning.