Stornoway Loss Deepens Amid Slow Market
May 14, 2019
RAPAPORT... Stornoway Diamond Corporation fell deeper into the red in the first quarter, as rough prices softened, it said Monday.
The miner recorded a net loss of CAD 48.4 million ($36 million) for the three months ending March 31, in comparison to a loss of CAD 11 million ($8.2 million) during the same period last year.
“A continued downward pressure on the market price for rough diamonds has inhibited the [company’s] ability to generate positive free cash flow in 2019,” Stornoway said.
The Canada-based miner plans to suspend open-pit operations at its Renard mine in order to save CAD 18 million to CAD 20 million ($13.4 million to $14.9 million) during the course of the year. It will continue to mine from two underground ore bodies at Renard.
Revenue dropped 4.7% year on year to CAD 53.3 million ($39.6 million) for January to March. The company sold 429,506 carats at two tenders during the period, a 37% increase over the same period a year ago. The average price slid 26% to $83 per carat.
A higher ore grade at Renard lifted production by 56% year on year to 444,562 carats, Stornoway noted. However, output dropped 8% compared with the previous quarter as the miner suffered mechanical issues with its equipment due to the extreme cold in January and February.
Image: The Renard underground mine. (Stornoway Diamond Corporation)
Article originally published on Diamonds.net here