Gem Diamonds Limited

Ladies and gentlemen, and welcome to Gem Diamonds' full year results presentation for the year ended 31 December 2025. The presenters today are Clifford Alfik, CEO of Gem Diamonds, Michael Michael, CFO, and Brandon DeBrain, COO. Please use the Q&A function on the top of your screen to send through any questions. All questions will be answered at the end of the presentation. I will now hand over to Clifford.

Everybody and thank you for your time. Thank you for your attendance. As you can see, this is the 2025 Gem Diamonds annual report and accounts presentation. If we can turn over the page, please. Disclaimer, I'm sure you're all very aware of all of this. Let's not dwell on this. The next page, please. Right. It's me, Michael and Brandon. You're all familiar with us. So let's look at the year in review. We recovered some 90,000 carats. That is a little less than normal, a normal year for us, and that is based on the ore mix. It was what was anticipated from the ore which we processed. On the dollar per carat side, $1,100 per carat achieved for the year. Again, this is a little lot from our normal year, Revenue of just shy of a hundred million dollars It was a tale of two halves, really. The first half of the year, under sustained pricing pressure, we were in a negative EBITDA loss. Very happy to have turned that around to a positive $4 million EBITDA for the year, and that was really a good effort. We have a basic loss for the year before pre-exceptional items, and Michael will talk to that later. in some detail. Our net debt finished the year at $20 million. We're quite pleased with this because we generated quite a lot of cash during the year and were able to reduce this debt by some $8 million. Our all injury frequency rate, this is at a very low level. We're very pleased with that, as you will see from some graphs further on. We've achieved our decarbonisation target well ahead of the schedule which we had set ourselves and again that's something that we are well pleased with and our facilities remain, we have some facilities of some nearly $70 million available to us. So that's the snapshot of the year. Let's go into some more detail. About the the world as a whole economic backdrop 3.2 percent growth for 2025 wasn't bad and and also China although some doubt about the 5% it seems that they did meet their target and There's a slight change in Attitude in China towards spending money on diamonds. It's it's starting to happen, which is good news. I The tariff and the geopolitical tensions during the year really created substantial uncertainties and Lack of confidence and uncertainty doesn't help us in the diamond industry at all Of course the war first in June the attack on Iran and then subsequently You know towards the end of the year You know things getting obviously getting tough. All of this from a global economic backdrop was really not helpful. Turning specifically to the diamond market, the year was a tough one with continued pressure on the rough and polished diamond prices. And you will all have seen, you know, the major De Beers, but also junior diamond producers, all of us under significant pressure because of these pricing issues. What is starting to become apparent and the industry is at last grappling with this distinction between synthetic diamonds and natural mined goods, the advertising campaign has begun, work is being done and many of the midstream Traders, manufacturers are running their own campaigns and talking about the distinctions, and you're starting to get a clear distinction emerging between two basically different products. One is a very inexpensive product. You buy it, you walk out of the store, and you have absolutely zero value in your hands, as it were. And the other, of course, is natural, is more expensive, and retains value. On the other hand, we saw that the ultra-high-end luxury brands, we're talking Van Cleef & Arpels, Tiffany LVMH is top end jewelry they all had very good years and in particular the Van Cleef and Arpels results stick out we focus on that a lot because we supply into their programs into their needs and it's been quite interesting to see you know decimation at the very low end the Poorer quality, smaller goods, and yet at the top end, there's been this positive movement. Our position is as the top end in the kimberlach producers, and we believe that we are well positioned we've seen price increases starting in the fourth quarter of 2025 we started to see a shortage of goods in the market and our customers were bidding up and we have seen that continue into the first quarter of 2026 and that is a cause for some optimism we entered As a result of the difficulties which we were experiencing in the market and therefore the need to look after our balance sheet, look after our cash position, not squander any money. We entered into what we termed the business resilience program. This was, I think, extremely well executed. It took a short time to complete the planning for it. We implemented it, and within months, we were starting to see the benefits of that resilience program implementation. Of course, given different pricings and the pressure which the industry has been under, we look at our long-term mine plan at all times, and we have to optimize and shift the delivery of all. We're fortunate to have the two pipes, and so it does give us a measure of flexibility, not complete flexibility, but a measure. And so that is the position as far as GEM is concerned. Let's turn over, please. Let me just speak a little bit about this program and then I'm going to hand over to Brandon As I said When it became clear that we had to react quite aggressively to what was confronting us It really was a question of rapid action with those two Conservation of cash and the balance sheet protection at top of mind So we immediately accessed some additional higher value satellite all and Reduce the waste mining volumes that obviously increases revenue reduces costs, but unfortunately That was not enough and therefore we had to rationalize the workforce. We had a situation where the board and senior management agreed to salary sacrifices and also we slimmed the board down because in a small company such as ours that is a dead weight as it were from an expense point of view. Obviously there are many positive things which come out of a listed board, but it was appropriate to slim this down as far as we possibly can and within the limits of stock exchange regulations. CapEx was scrubbed, all CapEx, and we look at that and turn it over time and time again, and essential CapEx is done, but non-essential and longer-term CapEx was put on hold. And of course, the obvious thing was to re-look at all of our supplier contracts. and just renegotiate and renegotiate and push and shove and this resulted as you can see at the bottom of this page in monthly savings of a million and a half dollars we reduced it allowed us to build cash in the second half and reduce our debt by some $8 million. The EBITDA turnaround of 6.5 resulted in a net EBITDA for the year of just under 4, and we got some additional revenue from satellite pipe ore. So this was, you know, a reaction to those situations. And I think I'd like to say it was very well implemented rapidly and decisively. And we were very happy to see the results which emerged. Brandon, will you take over, please?

Thanks, Luke. I agree. I think, you know, rapid change in management and work in the H2, taking to account the challenges we saw in H1, in particular the price and the driving impact on operations. But we'll get into those over the next few slides. Starting with our priority, which is our safety. Very happy to report an excellent safety performance in 2025 with zero fatalities. We have, again, for the second and third year running, injury frequency range, and you can see it in the graph, continuous downward trend, which is what we're driving towards, and only two LTIs in the year to share this, a very low LTI-FR ratio as well. That was against three LTIs in the previous year. So all the efforts that we introduced in mine plan changes and management changes We continue our focus on safety and good outcomes throughout the year. We had no major or significant environmental incidents and again, no major or significant social incidents and had very good with our communities. Return the pace to sustainability. As Clifford mentioned, we have reached our 30% reduction in carbon emissions in our Scope 1 and 2 reduction, which is like grid and diesel power in particular. This is largely based on reduction of volumes, in particular on waste mining, so that had an impact on our Scope 1 reductions, but also there were a number of energy efficiency initiatives that have been implemented over the past few years, which have added to our reduction in our emissions. Our focus going forward is to maintain this 30% reduction in scope one and two carbon emissions against our 2021 baseline and as you've seen in the mine plan that we released to the market in September last year, there is a and our scope one and two emissions. Our CSI projects, I'm pleased to say that notwithstanding the challenges that we faced last year, just from a financial perspective, we met our obligations in terms of our lease, minding lease and our obligations to the and our focus on CSI projects was on education, infrastructure and SME development and that went well last year. Our residue cleaning facilities remain well managed and aligned to GISTM and remain top class, no concerns. We retained our safety and environmental retain our FTSE for green status and our integration of our eight adopted UN SDGs. We recently completed a gap analysis to ensure we are contributing meaningfully to these goals. And I'm pleased to say that our efforts are contributing meaningfully. We can flip the page. As mentioned, operationally 2025 was a very positive year. In particular, building in the changes that we implemented in H2 saw very positive results from an operational perspective. 2025 was our first full year of mining and treatment being insourced, and we've certainly seen the benefits from both the cost and operational efficiency perspective. We adapted our mine planning in H2 last year to manage with most of the value of that coming out from a reduction in waste through the redesign of the final cutback in the main part, which is cut for waste, and also a deferral of waste mining in the satellite part for two reasons. One, we introduced additional satellite ore, as Clifford mentioned, in 2025 by extending the current cutback. and we therefore had the opportunity to push out the commencement of the next cutback while we finish the extension in the cut-fire waste. So that allowed us to contribute a significant amount of additional SATs out of the way in 2025, which assesses the results in our revenue, in particular in H2. and the deferral and redesign of the cutback and the reduction of waste has not impacted our ability to ensure that we maintain our farming income span of all availability. And as Cliff had mentioned, that is mainly due to the flexibility that, or the limited flexibility that we have with T5s and redesign in the mine plan. So as you can see, our waste tons, a graph, our waste tons reduced to approximately 2 million tons last year. And we maintained a 5 million, in fact, in 2025, 5.2 million of treated ore throughout the year. methodology there during the year by introducing front-end loading into the plants, which provides a consistent feed, and that allowed the plants to continue to run safely and increasing operating time while maintaining a consistent run rate. So we had good operational efficiencies in the plants and the feeding to the plants. We also managed to reduce treatment costs following insourcing significantly, and this added to the numbers that Clifford mentioned in previous slides in terms of our monthly savings. Our long-term mine plan, we optimised that and released that to the market in September. There was a change to our main part mining, which reduced the waste of ones, and then also bringing in additional satellite tons. This we continuously look at, and particularly in the prevailing economic The next page. 90,000 carats were covered. This was in line with the great expectations and the all mix. Different to previous years, previous years in terms of the contribution. The satellite pipe has got a higher grade, which is more carats, and has got higher value than the main pipe, so a lower contribution that does impact on our grade and value. We did recover nine greater than 100 carat diamonds. Unfortunately, we assume most of them came from the main pipe, given the overall quality of those diamonds was not at the standard that we usually see. The table below, we can also see in a couple of the size categories, the impact of low volumes of satellite pipe and lower rate. But on the whole, a pretty good performance from the recoveries that we did get out of the treatment last year. At least on that, if I can hand back to Clifford for the soil modeling.