Key points
- The company sold 20,799 carats at an average price of about $210 per carat, generating revenue of $4,376,775 for the quarter ended Sept. 30, 2004.
- Net earnings were $822,159, or one cent per share, compared with a net loss of $478,387 in the same period of 2003.
- Production was suspended pending agreement on a new mine plan with joint-venture partner Samicor Mining Services Pty. Ltd. at the ML111 marine diamond concession off Luderitz, Namibia.
- The company purchased the twin airlift diamond mining vessel to be named mv DF Discoverer and expects to resume mining with it in about six months after upgrades.
Diamond Fields International Ltd. has provided first quarter earnings for the three months ended Sept. 30, 2004. All revenue resulted from the sale of diamonds held in inventory or recovered during operations. A total of 20,799 carats were sold at an average price of approximately $210 per carat, generating revenue of $4,376,775. Comparatively, the company sold 563 carats in the same period during 2003 at an average price of $158 per carat generating revenue of $89,137. Production, royalty and selling expenses associated with the sale of inventory totalled $1,921,057; whereas these operating costs for the same period in 2003 were $81,421. The company generated an operating margin of $2,455,718 for the three months ended Sept. 30, 2004, compared with $7,716 for the same period in 2003.
All dollar values are stated in United States currency unless otherwise specified.
Net earnings for the three months ended Sept. 30, 2004, were $822,159 or one cent per share, compared with a net loss of $478,387 or one cent per share in 2003. The increase in earnings was primarily due to the company’s jointly controlled operations with Samicor Mining Services Pty. Ltd. in mining Diamond Fields ML111 marine diamond concession off the coast of Luderitz, Namibia.
On Oct. 14, 2004, Diamond Fields announced in Stockwatch that production had been suspended pending agreement on a new mine plan, and that the company had agreed, in principle, with Samicor to amend the terms of the operations. The revised terms would increase DFI’s maximum contribution to operating costs and future operations would be on a month-to-month basis. To date the company and Samicor have not agreed on a mine plan, and the company is considering other commercial arrangements with Samicor.
Other developments with the Namibian marine concessions include the purchase of the fully equipped twin airlift diamond mining vessel to be named “mv DF Discoverer.” The company intends to refit and upgrade the vessel and improve its mining efficiency. DFI contemplates resumption of mining with this vessel in approximately six months time after completion of required upgrades. Also the company entered into a lease agreement with the option to purchase the sea diamond miner. The tool offers the possibility of taking the marine diamond mining industry to a new level by lowering costs and raising efficiency in diamond recovery.
During the three months ended Sept. 30, 2004, Diamond Fields announced the expansion of the East Greenland Ammassalik project area through a joint venture with adjacent landholder, NunaMinerals A/S. On Aug. 12, 2004, the company announced in Stockwatch it had entered into an option agreement with Liberian-based company, Ducor Minerals, to earn interest in the Gbapolu and Grand Gedeh mineral exploration agreements in Liberia. Results of a diamond drilling program were announced in Stockwatch on Aug. 17, 2004, of the Ogna nickel-copper project and plans for a subsequent geophysics program were announced. Based on exploration results and competing priorities management has decided to relinquish three of its four Sierra Leone properties, and not to pursue additional exploration on certain diamond and nickel projects in Madagascar. Accordingly, associated accumulated exploration costs have been written off. The company is still actively pursuing exploration programs in Sierra Leone and Madagascar notwithstanding the company’s partial writedown of its properties in these countries.
WARNING: The company relies upon litigation protection for “forward-looking” statements.
