Higher production from the Ekati diamond mine in the Northwest Territories and sharply lower interest expenses have meant a near-doubling in earnings for
The company posted net earnings of $15.4 million on revenue of $26.1 million for the three months ended Aug. 31, for a profit of 50 per share. Dia Met, which changed its financial year-end to May 31, did not calculate earnings for the three months ended Aug. 31, 2000, but in the most nearly comparable period last year, which ended July 31, the company made $7.9 million on revenue of $23 million.
Ekati, operated by
Production at Ekati during the period rose to 924,000 carats, of which 522,000 carats were sold in the quarter. In the three months ended July 2000, Ekati produced 732,000 carats and sold 443,000. Unit prices fell slightly, to US$165 per carat in the recent quarter from US$170 in the comparable period last year.
Dia Met’s interest costs fell to $2.9 million from $4.3 million in the July quarter of 2000, and second-quarter exploration expenditures were $783,000, down from $1.7 million 13 months before.
Dia Met’s major balance-sheet item, the debt on the Ekati mine, fell to $91 million in the quarter from $107 million at its May 31 financial year-end. It has only $760,000 in cash and total current assets of $1.7 million, and carries its Ekati share on its books at $337 million. Debts and deferred income taxes leave the company’s book value at $164 million.
In October, shareholders approved BHP Billiton’s takeover bid for the company. The approval was mainly a formality, as BHP already controlled 98.2% of Dia Met’s Class A shares and 84.9% of the Class B shares, tendered to its $687-million takeover offer earlier this year. Both classes of shares were bought out for $21 each. The British Columbia Supreme Court approved the terms of the merger on Oct. 31 and remaining shareholders will be receiving cash.
Be the first to comment on "Good quarter for Dia Met"