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Mountain Province Gains from Higher Prices

Aug 11, 2022 5:10 AM   By Joshua Freedman
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Mountain Province’s net profit rose 1% year on year to CAD 22.6 million ($17.6 million) in the second quarter as the global diamond market rebounded and rough prices firmed.

Sales jumped 30% to CAD 97.8 million ($76 million), the Canadian miner reported Tuesday. The company registered an average selling price of $130 per carat for the three months, 78% higher than a year earlier. This outweighed the negative impact of the weaker Canadian dollar, which dented profit because the company’s long-term debts are in US dollars.

“The prices realized in the first half of 2022 exemplify continued improved sentiment and demand in the rough-diamond market recovering from the peak of the Covid-19 pandemic effects,” management explained. This was “amplified by volatility due to speculation as to whether trade embargoes imposed on Russia could disrupt continuity of supply from Alrosa,” it added.

Post-holiday inventory replenishment by traders and manufacturers resulted in a strong start to 2022, the miner said. However, Covid-19 lockdowns in China and Russia’s invasion of Ukraine dampened activity toward the end of the first quarter, though prices recovered and stabilized in the second quarter, it added.

Sales for the first half of 2022 rose 41% year on year to CAD 182.4 million ($141.8 million), while net profit increased 58% to CAD 47 million ($36.5 million).

Mountain Province owns 49% of the Gahcho Kué mine Canada in a partnership with De Beers, which holds the remainder.

Image: The Gahcho Kué mine Canada. (Mountain Province)
Tags: Canada, Gahcho Kué, Joshua Freedman, mountain province
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