Sarine Technologies

[karlmarx]

In November again, the company slashed their salaries by another 20 per cent cut. When Patel got his salary on December 10, it was just Rs 54,000 — nearly half of what he got five months ago. The factory owners clearly told the employees that the business was not doing well as profit margins had reduced and Christmas sales were down.

“In the last six months or so, our salaries have been cut by 55 per cent and we cannot protest as we fear that our owner will sack us. We have come to know that the owner has decided to lay off 20 per cent of the staff. At this juncture, diamond polishers will not get jobs in other factories, and even if they get one, they will have to work for less salaries. The average salary of a diamond polisher in our factory is between Rs 30,000 to Rs 35,000, and even that has now gone down,” says Patel.

https://indianexpress.com/article/cities...t-5509508/

...

Are Sarine's problem short-term or more enduring?

Perhaps Q4's poor results are one-off? Perhaps the next few quarters will see a resumption in demand for polished diamonds?

Perhaps the cut in dividend is a sign of what management is expecting?

The future is hard to tell...

[karlmarx]

In its latest profit guidance, Sarine mentioned that it expects to report a loss when it reports its next quarterly. This probably should not surprise most followers, given the poor rough diamond sales during the period.

https://links.sgx.com/FileOpen/Sarine%20...eID=553826

What is surprising is that, from its latest Annual Report, Sarine continues to be dogged by DBC's infringement of its intellectual property, which began in 2017. In spite of the actions taken by Sarine to draw attention to industry practitioners of the foul play, and its effort to prosecute DBC through (lengthy and costly) legal means, it seems that Sarine has thrown in the towel when it mentioned that it has lowered it prices to remain competitive with DBC.

To further drive adoption of our industry-leading solutions, we have successfully launched very aggressive sales promotions of the Meteor™ and Meteorite™ systems, for small and very small rough stones under 0.9 and 0.4 carats, respectively, to essentially offer our superior technology at pricing comparative to that offered by DBC.

https://links.sgx.com/FileOpen/Sarine%20...eID=552044

[karlmarx]

Yet another poor sales cycle for diamond miners.

https://www.debeersgroup.com/reports/rou...mond-sales

Are jewelry manufacturers, especially those using melee-sized diamonds on watches and accessories, substituting mined diamonds with cheaper lab-grown?

Are consumers not buying because they are worried about macro-economic factors?

Are the Indian diamond manufacturers/processors going to enjoy better business conditions, in the near-term, and the long-term?

[wonghw12]

E-commerce should be growing and sites like Blue Nile should be gaining traction - do you know if these are the end customers of Sarine?

As a side note, I myself bought a lab-grown one.

[karlmarx]

They could be. But Sarine's downstream business may be too small to matter.

Separately, if there is someone who sells cheaper polished diamonds -- who perhaps use non-legal software in their course of business -- and if you have no qualms about buying from them, then you will indirectly be hurting Sarine's midstream business. In any case, Sarine's midstream business is already hurt when they lowered their prices to compete with their 'copycats.'

[cyclone]

Sarine Technologies Profitability Guidance

Current indications are that our revenues for the second quarter will be some 5% better than Q1, approximately US$11.5 million. But, due to the year-over-year reduction in our gross margin, even with our ongoing prudent management of our operational expenses (no significant increase in these except in G&A, which has bumped up sequentially by some US$ 0.3 million, due to the trial phase of our patent litigation during Q2), we currently expect that we will record a net loss similar to that of Q1 2019. This loss reflects non-cash expenses (depreciation, amortisation and option based compensation) of approximately one million dollars. The full report of our financials for Q2 2019 are expected to be released on 8 August 2019.

More details in https://links.sgx.com/FileOpen/Press%20R...eID=570820

[specuvestor]

https://sg.yahoo.com/style/the-elite-clu...55229.html

Funny that it makes no mention of manmade diamonds affecting the margin and supply

What is the purpose of diamonds? Vanity. Same with branded bags.

Fake diamonds in the past is too obvious. So were fake bags. Now not so obvious. That's why affluents going much higher end to Hermes because you can't really tell a Prada from fake anymore but you can sort of tell if the person can afford Hermes Tai-tais  are not going to ask for diamond grading certificates

That's the world of vanity they operate in. So if lab diamonds and real diamonds cannot be distinguishable, my guess is that it will have huge impact on diamond industry, provided the lab diamonds are able to break in. Sometimes it's mere politics, not quality. If lab diamonds manage to get a foothold in the market, I would say it WILL impact Sarine.

And we all know what is the value of diamonds in secondary market because of De Beers.

https://www.valuebuddies.com/thread-2623...#pid147651

[karlmarx]

De Beer's latest sales cycle fell yet again. More than half from the previous year.

https://www.debeersgroup.com/reports/rou...mond-sales

I suspect most of the PRC jewellery retailers may have begun switching to LGD for their diamond-encrusted gold jewelleries.

[BRT]

De Beer's latest sales cycle fell yet again. More than half from the previous year.

https://www.debeersgroup.com/reports/rou...mond-sales

I suspect most of the PRC jewellery retailers may have begun switching to LGD for their diamond-encrusted gold jewelleries.

de beers' prima donna attitude deserves to crack.
De Beers diamond sales keep falling as buyers allowed to say no
https://www.businesstimes.com.sg/consume...-to-say-no

De Beers sells gems at 10 sales a year in Botswana to a select group of customers, who are expected to accept the price and quantities they're offered. Membership of the group was once a lucrative coup for anyone in the industry, but some buyers are now struggling to make money as De Beers keeps prices high, even if it means selling fewer stones.

[Wildreamz]

World-Wide Google search interest for "Lab grown" up  40% y-o-y, "Lab grown diamond" up 100% y-o-y, "Lab grown diamond ring" up >100% y-o-y.