10 August 2023
TORONTO, Aug. 10, 2023 /CNW/ - Mountain Province Diamonds Inc. ("Mountain Province", the "Company") (TSX: MPVD) today announces financial results for the second quarter ended June 30, 2023 ("the Quarter" or "Q2 2023") from the Gahcho Kué Diamond Mine ("GK Mine"). All figures are expressed in Canadian Dollars unless otherwise noted.
Second Quarter 2023 Key Takeaways
1Cash costs of production, including capitalized stripping costs, and adjusted EBITDA are non-IFRS measures with no standardized meaning prescribed under IFRS. See "Reconciliation of non-IFRS measures" at the end of the news release for explanation and reconciliation.
Mark Wall, the Company's President, and Chief Executive Officer, commented:
"Second quarter production numbers saw quarter-on-quarter improvements relative to Q1 2023 with the exception of ore tonnes mined. The revenue reduction from Q1 2023 is due to the additional sale held during the first quarter delivering record revenue results. Our H1 sales results in Canadian Dollars are slightly up year on year when compared to H1 2022.
On ore tonnes mined there was a refocus towards Tuzo waste stripping to ensure that the 5034 orebody can be mined safely given that it will be mined concurrently with the Tuzo pit, which is directly above it. During the period there was also temporarily blocked ramp access due to geotechnical considerations in the 5034 pit.
This movement of the sequence of ore release is temporary with mining in the 5034 pit returning to planned rates in H2 2023. Given the large stockpile of ore, there is no expected carat production interruption.
On costs, the mine entered a period of heavy capitalized waste stripping during the quarter, which coupled with some one-off maintenance related costs, resulted in a high unit cost per carat recovered and tonne processed. An increase in mine waste stripping is helpful to the overall plan, we expect these costs to reduce as we phase out of the heavy waste stripping and return to planned areas of mining in the pit. Excluding capitalised waste stripping costs, cash cost of production on a per tonne treated and per carat basis in the first half of 2023, are approximately 10% below the same period in 2022.
A key operational initiative in Q2 was the 5-day plant maintenance shutdown. There were several areas of the processing plant that were identified as being the primary drivers of plant instability. There remains one further task to be completed on the primary crusher in September for the major refresh of the processing plant to be completed. We have seen a step change in processing plant performance since these works were completed.
Considering the points above our 2023 guidance remains unchanged, with production trending to the mid/lower end and production costs trending to the mid/upper end of the range.
We remain focused on paying down debt, with US$12.0 million repaid during the quarter. Subsequent to the quarter end, we repaid a further US$6 million of debt. The Company continues to focus on achieving our long-run debt to EBITDA ratio target. Our earnings per share (EPS) at 8 cents for Q2 brings us to 22 cents for H1 2023, which is consistent with H1 2022.
On growth, drilling results to date near Tuzo, the Hearne Deep and the Northwest Extension are returning positive intercepts. We look forward to continuing our work with our joint venture partner De Beers to explore and evaluate mine life extension possibilities for the project, such as deeper drilling at Gahcho Kué, as well as reviewing potential opportunities to incorporate kimberlites from our nearby Kennady North Project. We intend to report on the next phase of this project in early Q4, 2023."