Stornoway Diamond Corporation fell deeper into the red in the first quarter, as rough prices softened, it said Monday.
The miner recorded a net loss of CAD 48.4 million ($36 million) for the three months ending March 31, in comparison to a loss of CAD 11 million ($8.2 million) during the same period last year.
“A continued downward pressure on the market price for rough diamonds has inhibited the [company’s] ability to generate positive free cash flow in 2019,” Stornoway said.
The Canada-based miner plans to suspend open-pit operations at its Renard mine in order to save CAD 18 million to CAD 20 million ($13.4 million to $14.9 million) during the course of the year. It will continue to mine from two underground ore bodies at Renard.
Revenue dropped 4.7% year on year to CAD 53.3 million ($39.6 million) for January to March. The company sold 429,506 carats at two tenders during the period, a 37% increase over the same period a year ago. The average price slid 26% to $83 per carat.
A higher ore grade at Renard lifted production by 56% year on year to 444,562 carats, Stornoway noted. However, output dropped 8% compared with the previous quarter as the miner suffered mechanical issues with its equipment due to the extreme cold in January and February.
Image: The Renard underground mine. (Stornoway Diamond Corporation)