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Rockwell provides feedback from first quarter diamond sales

June 27, 2012

VANCOUVER, June 27, 2012 /PRNewswire/ – Rockwell Diamonds Inc. (“Rockwell” or
the “Company”) (TSX: RDI) (JSE: RDI) (OTCBB: RDIAF) announces the
results of its diamonds sales for the first quarter of fiscal 2013.

Total proceeds of US$5.9 million were generated from the sale of 6,234
carats at an average price per carat for the quarter of US$944. This
includes the sale of 1,005 carats from the proof of concept bulk x-ray
machine that were sold for an average price per carat of US$853.

     _____________________________________________________________________
    |           |      Carats   |    Revenue (US$)  |Price per carat (US$)|
    |___________|_______________|___________________|_____________________|
    |           |Q1 2012|Q1 2013| Q1 2012 | Q1 2013 |Q1 2012|    Q1 2013  |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Holpan     | 1,117 |    -  |1,096,331|      -  |   981 |         -   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Klipdam    | 1,825 | 2,185 |1,810,975|1,200,803|   992 |       550   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Klipdam    |       |       |         |         |       |             |
    |Extension  |   24  |    -  |  19,019 |      -  |   786 |         -   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Saxendrift | 1,813 | 2,037 |4,868,436|3,516,185| 2,686 |      1727   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Tirisano   |    -  | 1,007 |      -  | 313,712 |    -  |       311   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Total      | 4,779 | 5,229 |7,794,759|5,030,700| 1,631 |       962   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Saxendrift |       |       |         |         |       |             |
    |tailings   |    -  | 1,005 |      -  | 857,090 |    -  |       853   |
    |___________|_______|_______|_________|_________|_______|_____________|
    |Total sales| 4,779 | 6,234 |7,794,759|5,887,790| 1,631 |       944   |
    |___________|_______|_______|_________|_________|_______|_____________|

The salient features of the fourth quarter diamond sales are as follows:

        --  The Klipdam Mine achieved a 20% increase in carats sold, as a
            result of mining the Rooikoppie unit. The average revenue per
            carat of US$550 was in line with the previous quarter,
            resulting from the finer diamond distribution in the previously
            mined Rooikoppie unit, which also has a lower cost of mining.
        --  Although carats sold from Saxendrift increased 12% year on
            year, (up 10% quarter on quarter), a lower average price per
            carat of US$1,727 was recorded. The year on year decline in
            average price per carat was due to the sale of several high
            valued stones in the comparative quarter of fiscal 2012, only a
            handful of which are recovered annually, that significantly
            raised the average value per carat for that period.
        --  A total of 1,007 carats recovered from Tirisano were sold
            during the first quarter at an average price of US$311 per
            carat. The decrease in average carat value is due to mining a
            less clay rich unit and the processing of tailings overlying
            the above unit during the rainy season, which has a smaller
            average diamond size. This was necessitated by the mine's
            reliance, in the interim, on dry front-end processing
            capability. However, this will be chiefly mitigated with the
            installation of a wet front-end processing system which is
            currently being commissioned.
        --  Diamonds recovered from Saxendrift tailings, using the proof of
            concept bulk x-ray project that was commissioned in April 2012,
            totaled 1,005 carats. These were sold at an average value per
            carat of US$853.

“Tangible benefits of our diamond value management initiatives are
starting to flow through, with a 44% increase in carats sold in the
first quarter from our three operational mines,” said James Campbell,
CEO, Rockwell. “The sale of 1,005 carats from the pilot bulk x-ray
project at Saxendrift also provided an unbudgeted boost to our sales.
It is our plan to incorporate this technology into future mining
developments and the results of the proof of concept give us confidence
in the sales revenues that this technology could unlock for the
Company.”

Commenting on the diamond market, Campbell explained that: “Diamond
prices during the first quarter of fiscal 2013 were stable
year-on-year. In the polished market, we saw some pricing pressure,
mainly related to the global financial uncertainty. However, this was
dampened by growth in demand from India and China. In the USA,
especially in affluent market segments, retail sales are showing signs
of recovering. We have seen the biggest drop in prices for smaller
polished diamond while prices for plus 2 carat stone sizes, which
represent more than 80% of Rockwell’s production, have been constant.
It is our expectation that rough prices will remain stable for the
remainder of the calendar year.”

Notable Stones

The Company continued to produce large stones at all its operations
during the fourth quarter with the recovery of 69 stones exceeding 10
carats:

        --  Klipdam produced 18 stones exceeding 10 carats, including four
            stones exceeding 20 carats;
        --  Saxendrift produced 32 stones that were larger than 10 carats,
            with four +50 carat stones, including a 92 carat rough diamond;
        --  Tirisano produced three plus 10-carat stones; and
        --  The pilot bulk x-ray system produced 16 stones exceeding 10
            carats from Saxendrift tailings with the largest weighing 53
            carats and 74 carats respectively.

These stones were channelled into the Company’s beneficiation joint
venture with Steinmetz Diamond Group, which delivers value added
revenues for Rockwell’s stones that are larger than 2.8 carats.

About Rockwell Diamonds:

Rockwell is engaged in the business of operating and developing alluvial
diamond deposits, with a goal to become a mid-tier diamond production
company.  The Company has three existing operations, which it is
progressively optimizing, two development projects and a pipeline of
earlier stage properties with future development potential.

Rockwell also evaluates merger and acquisition opportunities which have
the potential to expand its mineral resources and production profile
and would provide accretive value to the Company.

No regulatory authority has approved or disapproved the information
contained in this news release.

Forward Looking Statements

Except for statements of historical fact, this news release contains
certain “forward-looking information” within the meaning of applicable
securities law. Forward-looking information is frequently characterized
by words such as “plan”, “expect”, “project”, “intend”, “believe”,
“anticipate”, “estimate” and other similar words, or statements that
certain events or conditions “may” or “will” occur. Although the
Company believes the expectations expressed in such forward-looking
statements are based on reasonable assumptions, such statements are not
guarantees of future performance and actual results or developments may
differ materially from those in the forward-looking statements.

Factors that could cause actual results to differ materially from those
in forward-looking statements include uncertainties and costs related
to exploration and development activities, such as those related to
determining whether mineral resources exist on a property;
uncertainties related to expected production rates, timing of
production and cash and total costs of production and milling;
uncertainties related to the ability to obtain necessary licenses,
permits, electricity, surface rights and title for development
projects; operating and technical difficulties in connection with
mining development activities; uncertainties related to the accuracy of
our mineral resource estimates and our estimates of future production
and future cash and total costs of production and diminishing
quantities or grades if mineral resources; uncertainties related to
unexpected judicial or regulatory procedures or changes in, and the
effects of, the laws, regulations and government policies affecting our
mining operations; changes in general economic conditions, the
financial markets and the demand and market price for mineral
commodities such and diesel fuel, steel, concrete, electricity, and
other forms of energy, mining equipment, and fluctuations in exchange
rates, particularly with respect to the value of the US dollar,
Canadian dollar and South African Rand; changes in accounting policies
and methods that we use to report our financial condition, including
uncertainties associated with critical accounting assumptions and
estimates; environmental issues and liabilities associated with mining
and processing; geopolitical uncertainty and political and economic
instability in countries in which we operate; and labour strikes, work
stoppages, or other interruptions to, or difficulties in, the
employment of labour in markets in which we operate our mines, or
environmental hazards, industrial accidents or other events or
occurrences, including third party interference that interrupt
operation of our mines or development projects.

For further information on Rockwell, Investors should review Rockwell’s
annual Form 20-F filing with the United States Securities and Exchange
Commission www.sec.com and the Company’s home jurisdiction filings that are available at www.sedar.com.

 

SOURCE Rockwell Diamonds Inc.


Source: PR Newswire