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Dominion’s Sales and Production Decline

Aug 21, 2016 7:31 AM   By Rapaport News
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Dominion Diamond Corporation’s rough sales fell 24 percent in the second fiscal quarter due to a shift in focus to lower-value goods at its Ekati mine in Canada.

Revenue declined to $160 million in the three months that ended July 31 because lower-value rough from the mine’s Misery Satellites constituted a higher proportion of diamonds available for sale, the company said.

Sales of rough from Ekati, which Dominion owns outright, were $83.3 million, implying a 40-percent slump versus last year’s reported figure. Production at Ekati fell 7 percent to 856,000 carats, impacted by a shutdown followed a fire at the mine in June. The company’s revenue from its 40 percent owned Diavik mine in Canada increased 6.5 percent to $76.7 million.

During the first six months of the fiscal year, sales were $338.2 million, implying a 15 percent drop from a year ago.

Rough prices stabilized during the quarter supported by “confident” U.S. retail demand after jumping about 8 percent sequentially in the previous quarter. Liquidity in the industry improved as better market conditions helped lower inventories throughout the pipeline. Banks that finance the sector remain “cautious” and retail markets outside the U.S. remain impacted by the stronger dollar, Dominion said.

Separately, Dominion agreed to sell its downtown Toronto office building for approximately $65.9 million (CAD 84.8 million), with the deal expected to close in the third fiscal quarter.
Tags: Canada, Diavik, Dominion, Dominion Diamond Corporation, ekati, Misery Satellites, Rapaport News, rough prices, toronto
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