Mountain Province Diamonds Announces Third Quarter and Nine Months Ended September 30, 2019 Results and Updates Full Year 2019 Guidance

5 November 2019

News Release, TORONTO and NEW YORK, Nov. 5, 2019 /CNW/ - Mountain Province Diamonds Inc. ("Mountain Province", or the "Company") (TSX and NASDAQ: MPVD) today announces its financial and operating results for the third quarter ("the Quarter" or "Q3 2019") and nine months ended September 30, 2019.  The Company also provides an update to its full year 2019 guidance.  All figures are expressed in Canadian dollars unless otherwise noted.

Revised 2019 guidance

  • The Company increases its full year 2019 production guidance from 3.2 – 3.3 million tonnes processed to 3.3 – 3.4 million tonnes processed.
  • The Company narrows its full year 2019 production guidance from 6.6 – 6.9 million carats to 6.7 – 6.8 million carats (100% basis).
  • The Company also reduces its full year 2019 cost guidance from $110 - $120 per tonne treated to $95 - $105 per tonne treated.
  • The Company reiterates its cost guidance of $50 - $54 per carat recovered.

Operational highlights for Q3 2019

  • 11,742,138 total tonnes mined, a 1% increase on comparable period (Q3 2018: 11,592,000), and an 8% increase from previous quarter (Q2 2019: 10,865,263).
  • 890,325 tonnes of ore treated, a 17% increase from comparable quarter (Q3 2018: 759,000 tonnes), and a 1% increase from previous quarter (Q2 2019: 882,374).
  • 1,528,494 carats recovered at an average grade of 1.72 carats per tonne, 16% lower than comparable quarter (Q3 2018: 1,819,000 carats at 2.40 carats per tonne), and 12% lower than the previous quarter (Q2 2019: 1,730,147 carats at 1.96 carats per tonne). As previously announced, the ongoing plant modifications to change the bottom cut off and increase daily throughput have progressed well and the plant is performing above expectations, consistently achieving higher daily throughputs. Extreme and prolonged cold weather conditions encountered during the earlier part of the year caused delays in the mine plan schedule, as access to the planned higher-grade blocks of the orebody were limited. In addition, higher plant throughput capability as a result of the ongoing plant modifications, required the processing of all available ore sources, which mostly consisted of lower grade ore tonnes, all of which are reflected in the lower grades and carats recovered in Q2 and Q3 2019 results. The current quarter (Q4 2019) is trending positively as access to higher grade blocks has been re-established with record carat production achieved in October.

Financial highlights for Q3 2019

  • 791,252 carats sold at an average value of $69 per carat (US$52.5 per carat) for total proceeds of $54.8 million (US$41.6 million) in comparison to 788,842 carats sold at an average value of $95 per carat (US$72.5 per carat) for total proceeds of $74.9 million (US$57.2 million) in Q3 2018. 
  • Adjusted EBITDA1 amounted to $10.6 million ($37.9 million in Q3 2018).
  • Loss from mine operations amounted to $6.1 million (earnings from mine operations $25.2 million in Q3 2018).
  • Cash balance as of September 30, 2019 was $28.3 million (post purchase of secured notes payable of $13.2 million) and net working capital of $93.2 million (2018: $92 million), with US$50 million revolving credit facility remaining undrawn. 
  • During the three months ended September 30, 2019, $13.2 million Canadian dollar equivalent of secured notes payable (US$10 million) were purchased by the Company.
  • Cash costs of $90 per tonne treated and $53 per carat recovered, include capitalized stripping costs1 ($88 per tonne treated and $37 per carat recovered in Q3 2018).
  • Net loss was $25.8 million or $0.12 loss per share (net income $17.5 million or $0.08 earnings per shared in Q3 2018).  Included in the determination of net loss for the three months ended September 30, 2019 are unrealized foreign exchange losses of $3.1 million, on the translation of the Company's USD-denominated long-term debt. The unrealized foreign exchange losses are a result of the relative weakening of the Canadian dollar versus the US dollar in the quarter.

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