NAMDIA profits explode, increasing by almost 300% in 22/23 financial year
By Clifton Movirongo.
Namib Desert Diamonds (NAMDIA) has surpassed the N$400 million profit after tax mark for the first time since its inception, owing to revenue growth of over N$3 billion, an increase of N$1.2 billion from N$1.9 billion in the previous financial year.
According to NAMDIA’s overview and performance highlights, the company’s profits increased remarkably last year from N$144.7 million to N$409.2 million, mostly due to diamond carat weight increasing from 222,978 to 278,609 carats.
NAMDIA’s Chief Operating Officer, Uahoroka Kauta, noted that the improved pricing that they have been able to obtain, driven by the sales strategy, has also contributed considerably to profitability.
He added that the company was able to fetch 200% above the standard selling value of the previous financial year. Furthermore, NAMDIA is already above the 10% target this year with a standard selling value of 15.3%, up from 7% in the previous fiscal year.
Meanwhile, the improved profitability can also be attributed to sanctions on Alrosa, a government-owned Russian diamond miner, which paved the way for improved market access by the Namibian producer.
Kauta continued: “For the first time, we have exceeded an average sales price of US$650 per carat, driven mostly by the post-Covid recovery and stock shortages due to disruptions in Russian production.”
As a wholly-owned government enterprise, NAMDIA are entitled to a quota of locally-mined raw diamonds roughly split along 75% for stones below 2 carats, 23% for stones above 2 carats and 1.2% special stones.
Concerning previous fiscal year contributions to the government, NAMDIA contributed in the form of the export levy at 1%, and income tax of N$232 million, an increase from the previous fiscal year when they contributed just over N$182 million.
“”NAMDIA’s sales strategy was initially direct sales, then a hybrid selling method consisting of 60% direct sales, and 40% competitive bidding. This strategy helped NAMDIA to discover prices using different methods and to ensure client commitment to the company and brand.” said Chief Executive Alisa Amupolo.
She explained that for the 3 years from 2023 to 2026, 100% of NAMDIA’s diamonds will be sold through competitive bidding driven by continued client enrollment and preference for Namibian-owned or partly-owned enterprises.
