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Mountain Province Slips into the Red

Nov 9, 2022 9:09 AM   By Leah Meirovich
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Mountain Province reported a loss in the third quarter despite record revenue, as the weak Canadian dollar dragged down its bottom line.

The company had a net loss of CAD 7.2 million ($5.4 million) for the three months ending September 30, compared with a profit of CAD 8.8 million ($6.5 million) a year earlier, it said Wednesday. The decline resulted from unrealized foreign exchange losses amounting to CAD 26.3 million ($19.6 million) that emerged from the translation of the company’s US-dollar denominated debt to the Canadian dollar in which it reports. 

Earnings from mining operations grew 26% to CAD 44.7 million ($33.4 million), driven by a 12% rise in revenue to CAD 110.1 million ($83.3 million) – its highest-ever quarterly sales. The average price jumped 44% to $104 per carat, outweighing a 22% drop in sales volume to 805,000 carats. Production at the Gahcho Kué mine in Canada fell 7% to 1.5 million carats, with Mountain Province taking 49% of recoveries and co-owner De Beers entitled to the remainder.

Mountain Province signed a refinancing deal with its debt holders during the quarter, extending the terms of its payback schedule by three years, CEO Mark Wall noted. Meanwhile, the company is also considering its course of action to extend the life at Gahcho Kué. It will consider the feasibility of going underground based on work being done at the Hearne Northwest extension, which was discovered in the second quarter, Wall explained.

Profit for the first nine months of the year rose 3% to CAD 39.8 million ($29.6 million), while revenue climbed 31% to CAD 292.5 million ($217.5 million). Sales volume dropped 19% to 1.9 million carats, with the average price surging 62% to CAD 154 ($115) per carat.

Image: The Gahcho Kué mine. (Mountain Province) 
Tags: Canada, De Beers, diamonds, Gahcho Kué mine, Leah Meirovich, Mark Wall, mountain province, Rough Diamonds
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