Mountain Province Diamonds announces second quarter and half year 2019 results
6 August 2019
Mountain Province Diamonds Inc. today announces its financial and operating results for the second quarter ("Q2 2019") and first half 2019 ("H1 2019") ended June 30, 2019. All figures are expressed in Canadian dollars unless otherwise noted.
Operational Highlights for Second Quarter 2019
•10,865,263 total tonnes mined in Q2 2019, 6% increase on comparable period (Q2 2018: 10,285,000).
•882,374 tonnes of ore treated in Q2 2019, 2% decrease from comparable quarter (Q2 2018: 899,000 tonnes).
•1,730,147 carats recovered at an average grade of 1.96 carats per tonne, 10% lower than comparable quarter (Q2 2018: 1,930,500 carats at 2.15 carats per tonne). The grade variance year over year is mainly a function of mining lower grade ore tonnes in Q2 2019 from Hearne and SWC Kimberlites in comparison to higher grades from the 5034 Kimberlite in Q2 2018. In addition, the ongoing plant modifications have, as expected, resulted in the removal of the very small, lowest value diamonds from the recovery process further contributing to fewer carats recovered.
Financial Highlights for Second Quarter 2019
•1,077,730 carats sold at an average value of $89 per carat (US$67 per carat) for total proceeds of $95.8 million (US$71.7 million) in comparison to 1,113,724 carats sold at an average value of $89 per carat (US$69 per carat) for total proceeds of $99.1 million (US$76.8 million) in Q2 2018. It is important to note that the majority of the carats sold in Q2, 2019 were from the Hearne and SWC kimberlites as per plan, which contain lower average values per carat than the 5034 ore body, that made up most of the production in the previous year. The achievement of similar average values per carat sold year over year is very encouraging and can be attributed to the Company's ongoing efforts with its JV Partner, De Beers Canada to focus on optimizing the processing facilities recoverable size frequency distribution.
•Adjusted EBITDA1 for the three months ended June 30, 2019 amounted to $39.1 million ($41.1 million in Q2 2018).
•Q2 2019 Earnings from mine operations amounted to $17.8 million ($18.5 million in Q2 2018).
•Free Cash Flow for the three months ended June 30, 2019 amounted to $18.9 million ($4.8 million in Q2 2018). Cash balance as of June 30, 2019 was $30.2 million.
•Subsequent to the six months ended June 30, 2019, $9.2 million Canadian dollar equivalent of secured notes payable (US$7 million) was purchased by the Company.
•Q2 Cash costs of $106 per tonne treated and $54 per carat recovered, include capitalized stripping costs1 ($112 per tonne treated and $52 per carat recovered in Q2 2018).
•Q2 Net income was $10.3 million or $0.05 earnings per share ($6.4 million or $0.03 loss per shared in Q2 2018). Included in the determination of net income for the three months ended June 30, 2019 are unrealized foreign exchange gains of $7.5 million, on the translation of the Company's USD-denominated long-term debt. The unrealized foreign exchange gains are a result of the relative strengthening of the Canadian dollar versus US dollar.
1Cash costs of production, including capitalized stripping costs, and adjusted EBITDA are non-IFRS measures with no standardized meaning prescribed under IFRS. See the Non-IFRS Measures section of the Company's June 30, 2019 MD&A for explanation and reconciliation.