DiamondCorp Narrows Losses as First Antwerp Tender Approaches

Mining and Exploration
13/09/2016 10:34

DiamondCorp, a UK-based emerging diamond producer whose primary asset in South Africa is the Lace Diamond Mine located some 200 kilometres south-west of Johannesburg, has reported a reduction in operating losses for the six month period ended 30 June 2016 as compared to the same period in 2015. "After adjustments for a stronger Rand exchange rate, the pre-tax loss for the period was reduced to £0.247 million (US$0.329 million) compared with a loss of £3.159 million (US$4.20 million) in the same period in 2015. Total assets at 30 June were £39.227/US$52.19 million (£32.719/US$43.54 million in 2015) and liabilities were £28.456/US$37.87 million (£25.219/US$33.56 million in 2015)." Furthermore, headline loss per share was recorded at £0.04 pence (US$0.053) per share (2015: headline loss of £0.98 pence (US$1.30 per share). The change is a significant sign of the progress the company has made in the intervening period, as the Lace diamond mine in South Africa is now fully operational. 

Admittedly, there have been some problems along the way. Several operational issues impacted production during August, as water ingress and low grades material from former workings hampered production, "all of which have now been overcome." The company considers that such operational issues are “not unusual” during the ramp up phase of a mine. However, "One of the knock on effects of this lost production is that the September diamond sale will now be c.5700 carats, not 7,000 as previously planned." They add that, "The diamonds yielded during August remain of a high quality, and four stones larger than 10 carats were recovered, including a 12.7 carat gem diamond. These diamonds will be sold in the October sale." The first tender of diamonds in Antwerp to be held by Diamondcorp is just four days away, with results expected on 20 September. Subsequent monthly sales will be concluded around the middle of each month.