**resource estimates $1.18 billion***

I do believe the market has overreacted to the latest announcements and will be re-rating this stock very soon. The change in costs and revenues reported recently were based on assumptions and assumptions only as the company has stated. The last 12 months for Kimberley have been exciting if not challenging but I believe this latest sell down was a mere aberattion that will be rectified quickly.

Not only has the company announced new discoveries and an increase in diamonds produced but an increase in dollars obtained per carats. As a result it is considering bringing forward major expansionary plans which should be expected as it ramps up production. In any event they will be one-off costs and not impact the rcontinually growing reserve estimated imho.

Some difficulty in recovering some diamonds in an area has also reduced the recovered carats but this will be addressed with a state of the art crushing plant. The resource has simply been deferred to another earnings periofd and should not be seen by the market as a fall in grade. In fact Kimberleys recovery rate is still averaging 11.7 carats per 100 tonne against its latest reported 7.4. This is misleading in itself but the company maintains it was simply using the more world average figure to be conservative and in line with that measure. Really did ruffle the feathers in the market though.

Here are the latest recovery figures. Note the $ received per carats:


2002/3 51819 carats produced with an average price of $264 per carat


2003/4-62554 carats produced with an average price received of $258 carat

June quater-74512 diamonds weighing 23136 carats were produced in the June quarter and 11094 of these was sold for $384 carat.


***TIME TO WAKE UP PEOPLE*********