Mountain Province shared not encouraging statistics for the first half of the year, with revenue dropping by 22%, reaching CAD 146.3 million ($107.7 million).
The Gahcho Kué mine in Canada is 51% controlled by De Beers, and the rest is owned by Mountain Province. The decline in the value of the country’s currency relative to US currency influenced the company because revenue is generated in Canadian dollars while debt obligations must be paid in US dollars.
As was stated earlier this week, the company had a net loss of CAD 6.5 million ($4.7 million) for the quarter ending June 30. Last year, the same period brought absolutely opposite data – a profit of CAD 17.3 million ($12.6 million). Looking closely at other statistics, it is important to point out that revenue for the period declined 5% year on year to CAD 56.8 million ($41.5 million) despite a 55% increase in sales volume to 557,361 carats. Meanwhile, production for the quarter dropped 2% to 1.3 million carats.
Another reason for the loss is the rough diamonds market situation, where the average price per carat fell by 39% to CAD 102 ($74). Additionally, the company mined lower-grade ore than anticipated from the deeper sections of its pits, resulting in a reduced amount of rough available for sale.
Mark Wall, Mountain Province CEO, stated in his comment that we should consider the context of a softer diamond market and the grade challenges of the second quarter. However, operations efficiency and cost control continue to be top priorities at every stage within the business.
