Stornoway Diamond Corp Reports Progress Ahead Of Plan At End Of Q1

(IDEX Online) – Stornoway Diamond Corporation reports that 385,151 carats of rough stones recovered during the quarter ended March 31 from the processing of 419,233 tonnes of ore, for an attributable grade of 92 cpht, compared to a plan of 369,307 carats at 91 cpht.

The miner sold 459,126 carats of diamonds for $48.5 million, adding that progress has been ahead of schedule.

Total diamond sales since the project began now stand at 498,039 carats at an average price of $83 per carat ($110 per carat), reflecting higher than expected efficiencies in the recovery of small diamonds and higher than expected diamond breakage experienced during processing ramp-up.

Commercial production at the Renard Diamond Mine was formally declared, effective January 1, marking the end of the project's initial capital expense period.

Nonetheless, the firm reported a net loss of $3.0 million for the quarter.

At the end of the quarter, cash, cash equivalents and short-term investments stood at $72.1 million.

Available liquidity, comprising cash and cash equivalents and available credit facilities, net of payables and receivables, stood at $153 million.

Matt Manson, President and CEO, commented: “This quarter represents the first full operating period for the Renard Mine. Mining rates, development progress in the underground mine, and carat production all continue to exceed plan. Mining costs and capital expenditures are tracking within budget. Achieved pricing in our first tender sales reflects the higher than normal levels of diamond breakage that we have been experiencing during the first months of processing ramp up. Pricing has also been impacted by a better than expected liberation of small diamonds and the market effects of Indian demonetization.

Nevertheless, we are seeing positive trends in both the quality of our diamond production and in rough market pricing. We are particularly encouraged by the market’s reception for Quebec’s first diamond production. Yields of polished from the rough are reported as high, with good performance during manufacturing. Achieved pricing in the tender sales has been progressively higher compared to our reserve pricing as the market gains an understanding of the production, and tender participation has been strong. This trend has continued into the first sale of the second quarter, which was completed in April. As our production ramp-up continues, our focus remains the quality of our diamond recovery profile and the continued growth of our diamond sales.”