DIAMOND prices reached record levels last seen in 2008 in the fourth quarter of last year, says Rockwell Diamonds.

"Both rough and polished diamonds prices improved during the 2010 calendar year, with prices enjoying support from strong retail demand for diamonds in the second half of 2010," Rockwell said yesterday in its results for the year ended February.

Rockwell's financial position showed substantial improvement during the year, but its operational performance fell short of internal production targets. Operating profit of C$4m was reported, a turnaround of C$7,5m from a C$3,6m operating loss last year.

Revenue increased 43% year on year to C$42,5m, with an average price increase of 35% to $1365 per carat and a 2% rise in sales to 27017 carats. Production rose 5% to 26165 carats.

Cash generated by operating activities came to C$8,9m from C$110694 consumed in financial 2010, and the company's net cash balance increased to C$2,9m from C$1,8m.

A loss of C$5,1m, or C$0,01 per share, was posted for the year, compared with a loss of C$7m, or C$0,03 per share, in the year before. The improvement is mainly attributable to the higher average diamond price.

Diamond inventories totalled 1057 carats, slightly below the 1910 carats at the end of February last year.

"During the past six months, Rockwell has made enormous progress in repositioning itself to ramp up its production profile," said chairman David Copeland.

"Earlier this year, we completed a thorough strategic review to map the way forward for our company. Our focus is on implementing this strategy to unlock the inherent value in the company."

He said Rockwell would do this by optimising output from producing assets. I-Net Bridge