Make Kitco Your Homepage

Mountain Province Diamonds reports net income of C$49.2 million in 2022

Kitco News

Editor note Get all the essential market news and expert opinions in one place with our daily newsletter. Receive a comprehensive recap of the day's top stories directly to your inbox. Sign up here!

(Kitco News) - On Wednesday, Mountain Province Diamonds (TSX: MPVD) reported that 5,519,309 carats were recovered during FY 2022 at an average grade of 1.78 carats per tonne, 12% lower than the comparable period (FY 2021: 6,229,042 at 2.02 carats per tonne).

The company said that total sales revenue in 2022 was C$388.9 million (US$297.3 million) compared to C$298.3 million in 2021 (US$237 million: sales revenue in 2021 does not include the 'upside' revenue of $10.4m from the Dunebridge agreement), at an average realized value of C$146 per carat (US$112), compared to C$94 per carat (US$75) in 2021.

"In 2022, the company recorded its highest annual revenues since commencement of operations. Price performance was strong, with the company benefitting from favorable production characteristics in its recovered diamonds and the ability of the company to capitalize on a positive market price environment, particularly for smaller size diamonds," it added.

The company’s adjusted EBITDA was C$177.2 million in 2022, up 31% relative to 2021 (2021: C$135.4 million).

The company also reported net income of C$49.2 million or C$0.23 earnings per share in 2022 (2021: net income C$276.2 million or C$1.31 earnings per share. In 2021 there was an impairment reversal of C$240.6 million).

President and CEO Mark Wall commented, "2022 was a transitional year for the company. We repaid US$110 million in debt, US$60 million from operating cash flow and utilizing the US$50 million Junior Credit Facility, leading to a significantly improved debt to EBITDA ratio, and refinanced our bonds with a 9% coupon and with no dilution to equity holders. We also discovered the Hearne Northwest Extension which has led us to review the underground potential of the Gahcho Kué mine, including how the Kennady assets may integrate into this scenario, with the objective of understanding the opportunities that may exist to substantially extend the mine life.

"As we move into 2023, we continue to focus on safety, sustainability, and operational performance at the mine level. We'll continue to optimize our sales pipeline, and focus on our organic growth opportunities at the mine and at Kennady North. On the financial side of things, we are striving to improve our balance sheet by working on reducing debt directionally towards a 1:1 debt to EBITDA ratio to enable a disciplined approach to capital allocation."

Mountain Province Diamonds is a 49% participant with De Beers Canada in the Gahcho Kué diamond mine located in Canada's Northwest Territories. The Gahcho Kué Joint Venture consists of several kimberlites that are actively being mined, developed, and explored for future development. The company also controls over 113,000 hectares of prospective mineral claims and leases surrounding the Gahcho Kué Mine.

Gold producer Karora says its 2022 net earnings down due to higher costs

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.