I am not saying we are going to be comparing ourselves to Diamet right away, from our Brazilian production, but when I look at the debt that they have incurred it makes me appreciate what we have down in Brazil even more. Still it's nice to see what the bench mark is.
Dia Met year-end results
Dia Met Minerals Ltd DMM.B
Shares issued 22,019,496 May 2 close $19.00
Wed 3 May 2000 News Release
Mr. James Eccott reports
Dia Met Minerals had net earnings of $47.5-million or basic earnings per
share of $1.56 for the fiscal year ended Jan. 31, 2000, which represents
the first full year of production from the company's 29-per-cent-owned
Ekati diamond mine in Canada's Northwest Territories. Dia Met's equity in
earnings from Ekati totalled $99.8-million for the year.
"These results establish Ekati as a world-class asset with margins that are
exceptional for Canada's mining sector," said James Eccott, Dia Met's
president and chief executive officer. "With many years of profitable
production ahead, Ekati underpins Dia Met's stature as Canada's premier
diamond company, and provides us with a solid foundation for sustainable
long-term growth. We intend to lay out a clear and aggressive plan to build
on this foundation in the months ahead."
The earnings per share figure includes a one-time positive adjustment of 24
cents per share, relating to the recognition of future income tax assets
earned prior to the start of fiscal 2000. Without this adjustment, Dia
Met's net profits for fiscal 2000 would have totalled approximately
$40.2-million, equating to basic earnings per share of $1.32.
For the previous fiscal year ended Jan. 31, 1999, Dia Met reported a net
loss of $6.5-million or a loss of 21 cents per share. Dia Met's share of
earnings from Ekati diamond sales totalled $1.7-million for fiscal 1999.
In total, Ekati produced 2.51 million carats of diamonds for the year ended
Jan. 31, 2000, and sold 2.24 million carats at an average price of $168.05
(U.S.) per carat. Dia Met's share of diamond sales from Ekati for the year
amounted to $161.2-million from which $48.2-million for cost of sales and
$13.2-million for amortization and depreciation were deducted to yield
equity in earnings of $99.8-million. Cost of sales includes stripping,
mining, processing, overhead, administration, sorting and selling costs.
In the previous year, production at Ekati amounted to 0.42 million carats
with sales of 68,500 carats at an average price of $123.62 (U.S.) per
carat. The realized price of $168.05 (U.S.) per carat for fiscal 2000 was
29 per cent higher than the $130 (U.S.) per carat price upon which the 1997
Ekati feasibility study was based.
"The strong prices we enjoyed in fiscal 2000 partly reflect the
extraordinarily high quality of the Ekati stones," said Mr. Eccott. "If you
compare Ekati with almost any other hard rock diamond mine worldwide, the
value per carat we achieved is clearly at the high end of the scale.
Healthy global economic conditions and buoyant consumer demand also
contributed to strong prices, and we continue to experience a strong market
in the early months of fiscal 2001," he added.
Dia Met's outstanding debt obligations for Ekati totalled $204.8-million at
Jan. 31, 2000, down from $276.2-million a year earlier. The reduction of
$71.5-million or 26 per cent reflects the net impact of $93.9-million of
debt repayments in fiscal 2000, offset by interest charges of $21.1-million
and $1.3-million of development costs. Since the year-end, a further
repayment of $24.1-million has been made toward Dia Met's debt obligation.
Dia Met has applied 100 per cent of its share of net after-tax cash flows
to repayment of these obligations since the start of production at Ekati in
October, 1998.
Dia Met's total expenses for the year ended Jan. 31, 2000, were
$27.5-million, up from $11.4-million for fiscal 1999. The increase was due
primarily to interest on the obligations for Ekati.
During fiscal 2000 the company spent $9.6-million on mineral properties,
exploration and development. This compares with expenditures of
$6.6-million in fiscal 1999. The increase in fiscal 2000 reflects the
impact of new projects in Mauritania and Victoria Island.
Dia Met also spent $7.4-million in fiscal 2000 on shares repurchased under
normal course issuer bids, up from $5.5-million of comparable expenditures
in fiscal 1999. On Oct. 25, 1999, the company cancelled 136,000 Class A
shares and 331,400 Class B shares that were repurchased under these bids.
CONSOLIDATED STATEMENT OF EARNINGS
Year ended Jan. 31
2000 1999
Revenue
Equity in
earnings of
the Ekati
diamond
mine $ 99,753,695 $ 1,738,161
Aircraft
operations 247,300 284,860
Gain on disposal
of capital assets - 39,496
Interest and
other income 2,047,366 3,515,394
------------ ------------
102,048,361 5,577,911
------------ ------------
Expenses
Interest on
obligations
for the
Ekati diamond
mine 21,144,787 5,189,876
Amortization of
capitalized
interest and
direct
expenditures on
the Ekati
diamond mine 1,672,736 418,184
General and
administrative 3,298,041 3,400,738
Writedown of
temporary
investments 1,112,293 -
Depreciation 189,597 164,971
Aircraft
operations 111,384 132,872
Cost of mineral
properties
abandoned - 2,047,792
------------ ------------
27,528,838 11,354,433
------------ ------------
Earnings (loss)
before income
taxes 74,519,523 (5,776,522)
------------ ------------
Income taxes
Current 1,014,363 677,895
Future 26,005,234 -
------------ ------------
27,019,597 677,895
------------ ------------
Net earnings
(loss) for
the year $ 47,499,926 $ (6,454,417)
============ ============
Net earnings
(loss) per
share 1.56 (0.21)
(c) Copyright 2000 Canjex Publishing Ltd. canada-stockwatch.com |
