Jewelry News Network

Harry Winston Reports Strong Retail and Rough Diamond Sales

Harry Winston Diamond Corp. reported Wednesday that consolidated sales increased 62 percent to $153.7 million for the second quarter in a year-over-year comparison. Earnings for the period, ended July 31, were $28.9 million, compared to a loss of $3.9 million for the same quarter of the prior year.

Rough diamond sales rose 89 percent to $86.8 million for the quarter, year-over-year, according to the vertically integrated company with assets in a diamond mine along with luxury retail stores. The increase in sales was a result of a combination of a 62 percent increase in rough diamond prices and a 17 percent increase in volume of carats sold during the quarter.

Retail sales increased 37 percent to $66.9 million for the second quarter. U.S. sales increased 31 percent to $19.6 million, sales in Europe increased 40 percent to $24.7 million, and sales in Asia increased 40 percent to $22.6 million. Earnings from operations of $2.3 million for the quarter compare favorably to a loss of of $5.6 million, in the same quarter of the prior year.

Rough diamond production for the three months ended June 30, was 0.65 million carats, which was 14 percent higher than the comparable quarter of the prior, the company said. Production in the same quarter last year was unusually low, due to the planned lower volume of ore mined that reflected the softness in the rough diamond market last year.

Consolidated net income for the second quarter was $16.5 million, compared to a net loss of $24.5 million in the second quarter of the prior year.

“This quarter has demonstrated the continued recovery in the international diamond business and it has also shown additional improvement from our own business segments,” said Robert Gannicott, Harry Winston chairman and CEO. “Both mine production and rough diamond sales increased in parallel with the growth in retail sales from our network of international stores particularly at the high end. We expect further growth in retail sales supported by renewed marketing efforts as customers seek out true craftsmanship.”

The company also announced Wednesday that it appointed David Carey, president of Hearst Magazines, to its board of directors. Prior to joining Hearst, Carey was group president at Condé Nast, where he served as a member of the company’s executive committee and co-lead on all business development efforts, and in other positions at Condé Nast since 1995.

Harry Winston Diamond Corp. has assets in the mining and retail segments of the diamond industry. It supplies rough diamonds to the global market from its 40 percent ownership interest in the Diavik Diamond Mine. The company’s retail division is a diamond jeweler and luxury timepiece retailer with salons in key locations, including New York, Paris, London, Beijing, Tokyo, and Beverly Hills.

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More info at www.monacoyachtshow.com

Open to professionals, media representatives and the general public
20th Monaco Yacht Show – 2010
From Wednesday 22 to Saturday 25 September 2010
Open from 10am to 6.30pm

Venue
Port Hercules – Principality of Monaco
Locate the entrances of the exhibition venue
Main entrance to the show: DARSE SUD entrance.
Other entrances: CHICANE and PARVIS SUD.

Quayside exhibition

500 exhibitors: THE show in world luxury yachting

The MYS considers itself to be representative of the luxury yachting sector : Shipyards, brokers, designers, equipment manufacturers, luxury goods firms… a very wide range of activities is represented there.

The exhibitors are all professionally recognised experts and have in common the quality of their service.

The exhibitors are rigorously selected and reliable references from the luxury yachting world are the main selection criteria.

20,300m² of exhibition space on the quayside, giving 9,000m² of stand space, most of which is customised, welcome 500 exhibiting companies.

Double deck pavilions

Introduced in 2008 with great success, the double-deck pavilions in the central T and on Quai des Etats Unis now number 13.

Exhibitors : Amels, Abeking & Rasmussen, Benetti, CRN, Edmiston & Company, Feadship, Heesen, Fraser, Luerssen, Oceanco, Palmer Johnson, Perini Navi and Vitters.

Floating exhibition

100 exceptional yachts from 25 to 90m long

The Monaco Yacht Show is the most prestigious gathering of large ships on the planet : A selection of 100 exceptional super and mega-yachts from 25 to over 90 m long are presented by the most renowned brokers and shipyards.

It is a unique, world-first occasion to visit fortyish of the most beautiful motor and sailing-yachts built in 2010 and whose average size is about 45 meters in length.

A school in Caetés, Brazil, President Luiz Inácio Lula da Silva’s hometown.

CAETÉS, Brazil — When Luiz Inácio Lula da Silva was sworn in as Brazil’s president in early 2003, he emotionally declared that he had finally earned his “first diploma” by becoming president of the country.

One of Brazil’s least educated presidents — Mr. da Silva completed only the fourth grade — soon became one of its most beloved, lifting millions out of extreme poverty, stabilizing Brazil’s economy and earning near-legendary status both at home and abroad.

But while Mr. da Silva has overcome his humble beginnings, his country is still grappling with its own. Perhaps more than any other challenge facing Brazil today, education is a stumbling block in its bid to accelerate its economy and establish itself as one of the world’s most powerful nations, exposing a major weakness in its newfound armor.

“Unfortunately, in an era of global competition, the current state of education in Brazil means it is likely to fall behind other developing economies in the search for new investment and economic growth opportunities,” the World Bank concluded in a 2008 report.

Over the past decade, Brazil’s students have scored among the lowest of any country’s students taking international exams for basic skills like reading, mathematics and science, trailing fellow Latin American nations like Chile, Uruguay and Mexico.

Brazilian 15-year-olds tied for 49th out of 56 countries on the reading exam of the Program for International Student Assessment, with more than half scoring in the test’s bottom reading level in 2006, the most recent year available. In math and science, they fared even worse.

“We should be ashamed of ourselves,” said Ilona Becskeházy, executive director of the Lemann Foundation, an organization based in São Paulo devoted to improving Brazilian education. “This means that 15-year-olds in Brazil are mastering more or less the same skills as 9-year-olds or 10-year-olds in countries such as Denmark or Finland.”

The task confronting the nation — and Mr. da Silva’s legacy — is daunting. Here in this dirt-poor northeastern town, where Mr. da Silva lived his first seven years, about 30 percent of the population is still illiterate, a figure three times higher than the national rate.

When Mr. da Silva was a boy here, his father used to beat some of his older siblings when they went to school instead of working, said Denise Paraná, the author of a biography of the president.

Today, teachers say that many parents send their children to school only because school attendance is a requirement of the Bolsa Familia subsidy program that Mr. da Silva has greatly expanded under his watch, which provides up to about $115 a month per family.

But even with the added incentive, reading levels vary so greatly here that in one eighth-grade classroom, students from 13 to 17 all read aloud from the same text.

“A lot of parents say, ‘Why should they study if there are no opportunities?’ ” said Ana Carla Pereira, a teacher at another rural school here.

As president, Mr. da Silva’s own education policies got off to a slow start; he dismissed two education ministers before settling on one in 2005. Then the government’s educational program did not start until 2007 — four years after Mr. da Silva took office.

Now in his last year in office and talking about his place in history, Mr. da Silva has an “obsession” with the issue, his education minister, Fernando Haddad, said, which was plain to see when he recently returned here to his childhood town.

“I want every child to study much more than I could, much more,” he said while announcing a program to give laptops to students. “And for all of them to get a university diploma, for all of them to have a vocational diploma.”

The urgency could hardly be clearer. Brazil has already established itself as a global force, riding a commodity and domestic consumption boom to become one of the largest economies in the world. With huge new oil discoveries and an increasingly important role in providing food and raw materials to China, the country is poised to surge even more.

But the nation’s educational shortcomings are leaving many Brazilians on the sidelines. More than 22 percent of the roughly 25 million workers available to join Brazil’s work force this year were not considered qualified to meet the demands of the labor market, according to a government report in March.

“In certain cities and states we have a problem hiring workers, even though we do have employment,” said Márcio Pochmann, president of the Institute for Applied Economic Research, the government agency that produced the March report. Earlier estimates showed that tens of thousands of jobs went unclaimed because there were not enough qualified professionals to fill them.

Unless that gap is filled soon, Brazil may miss its “demographic window” over the next two decades in which “the economically active population is at its peak,” the World Bank said.

Dr. Haddad, the education minister, said that while Brazil still performed poorly compared with other countries, it was improving faster than many competitors.

“Brazil is trying to make up for lost time,” Dr. Haddad said. “While other countries were investing in education we were wasting our time here saying that education was not that important.”

The government has had some notable successes, including a program that has created about 700,000 scholarships for low-income students to attend private colleges, an effort lauded by education specialists.

Under Mr. da Silva, the government also opened more than 180 vocational schools — compared with 140 added during the previous 93 years — and has administered a new test to evaluate student performance.

School enrollment has continued to climb, a trend that began in the 1990s under the previous president, Fernando Henrique Cardoso, and middle school graduation rates have risen under Mr. da Silva by 13 percentage points to 47 percent, Mr. Haddad said.

But those successes fall short of the urgent thrust for change that some education specialists were hoping to see from Mr. da Silva, considering his background. Not nearly enough was done to improve the quality of education and teaching methods, and the president has not used his bully pulpit to inspire the nation to demand more from its teachers and schools, they say.

“He has this aura, he has this power, he influences a lot,” Ms. Becskeházy of the Lemann Foundation said. “He did not use the opportunity to lift people up.”

It has not helped, critics add, that Mr. da Silva has sometimes used his own lack of an education as part of a populist discourse to assail the well-educated “elites” who long ruled Brazil, almost boasting that he got as far as he did without formal education.

“In his speeches, he tended to pit less-educated people against the educated Brazilian elite,” Mr. Pochmann said.

Finding workers with the adequate basic skills for even manual labor jobs is becoming a challenge, and many companies are not waiting for Brazil’s education system to catch up. The Brazilian construction giant Odebrecht is one of several companies that train a potential labor pool for a few months in basic reading and math.

“Education is the big disadvantage for Brazil when compared to China, India and Russia,” said Paulo Henrique Quaresma, the director of human resources at Odebrecht, referring to the other three nations that global investors see as the world’s largest developing economies.

In Caetés, it is not difficult to see why.

“The first school my father introduced me to was the handle of a hoe,” said José Bezerra da Silva, who, like his wife, is illiterate and cannot help his children with their schoolwork. The couple and their seven children share a two-room house; the couch’s wood frame is poking out from under a threadbare cushion. “Lula changed a lot of things.”

Brazil’s first-grade repetition rate is 28 percent, among the highest in the world, the World Bank said, though the government contends that the number has been shrinking. Secondary schools contain many older students because of the high rate of failing students in earlier grades, and many of the frustrated simply drop out.

“Brazil will continue to grow slower than its potential,” said Samuel Pessoa, an economist at the Brazilian Economic Institute at the Getulio Vargas Foundation. “If it had a better education system, things would be different.”