Revenue from Rio Tinto’s diamond division slid 11% to $619 million in 2019 as prices for rough diamonds weakened, the miner reported Wednesday.
The diamond unit recorded a net loss of $21 million, compared with a profit of $118 million a year ago. Earnings before interest, tax, depreciation and amortization (EBITDA) plunged 50% to $151 million.
Diamond production fell 8% to 17 million carats for the year, with output slipping at both its mines. Carat recovery at Rio Tinto’s Argyle mine in Australia dropped 8% due to lower recovered grades, which were only partially offset by higher ore processing. Production also declined 8% at Canada’s Diavik mine as lower grades from the miner’s underground operation outweighed higher grades processed from the A21 open pit, Rio Tinto said.
The miner expects output of between 12 million and 14 million carats this year. The forecast of lower production reflects the closing of the Argyle mine, which will take place in the fourth quarter as it reaches the end of its mine life. Additionally, production will be affected by lower ore availability and grades from the underground portion of Diavik, it said.
Image: Diamonds from Rio Tinto’s Argyle Pink Everlastings collection. (Rio Tinto)