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Mountain Province Revenue Improves in 1Q

Miner posts strong results but warns of impending impact of COVID-19.
Apr 22, 2020 11:06 AM   By Rapaport News
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RAPAPORT... Sales of rough from Mountain Province’s Gahcho Kué mine grew 2.4% to 659,318 carats in the first quarter, the company said Monday.

The Canada-based miner also saw a 6% uplift in its average price, yielding $75 per carat compared to $71 per carat in the first quarter of 2019. Together, these factors increased the company’s revenue by 7% to $49.2 million for the three months ending March 31.

In total, the company recovered 1.7 million carats, up 4.5% compared with the previous year. This equates to 811,009 carats for the 49% stake it holds in Gahcho Kué. De Beers owns the remaining 51%.

However, the results are tempered by the ongoing coronavirus pandemic. Last month, Mountain Province said it would withdraw its forecast for 2020 until it had gauged the effect of COVID-19 on its operations. The miner confirmed Monday that it had suspended most long-term and non-core projects, as well as the company’s formal sales in Antwerp. It added that its mine continued to operate, albeit on four-week rather than two-week crew rotations.

The miner noted that it was currently “working through various planning scenarios” to assess the full impact on production and would “communicate this to the market when [it had] more clarity and certainty on what the future may look like.” It has meanwhile drawn $25 million from its revolving credit facility to alleviate the blow.

Shares in Mountain Province rose 10% Monday.

Image: The Gahcho Kué mine. (Mountain Province)
Tags: Gahcho Kué, mining, mountain province, Rapaport News, rough
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