Stornoway Diamond Corporation has reported a net loss of C$ 114.6 million for the year ended December 31, 2017, as compared to net income of C$ 19.6 million in 2016, under the impact of a non-cash impairment charge of C$ 171.0 million, reflecting a lower diamond price environment than was originally forecast by the Corporation.

The Company said that net income for the year before impairment was C$ 15.0 million.

During the year, 1,701,561 carats of rough diamonds were sold for gross proceeds of C$ 186.2 million at an average price of US$ 85 per carat (C$ 109 per carat).

In 2017, the Renard Diamond Mine attained commercial production, completed the processing ramp-up on schedule and accomplished two full quarters at or above plant nameplate operating capacity, Stornoway said, adding that a total of 1,642,934 carats were recovered during the period from 1,956,436 tonnes of ore at 84 cpht (98%, 97% and 99% of plan respectively).

Open pit mining operations at the Renard 2-3 and Renard 65 open pits stood at 4,475,854 tonnes (102% of plan), with 2,091,782 tonnes of ore extracted.

Subsequent to the year end, on February 7, 2018, the Corporation announced the attainment of full Completion Certification at the Renard Mine pursuant to the terms of Stornoway’s July 2014 material project finance agreements. At year end, cash, cash equivalents and short-term investments stood at C$ 81.0 million and available liquidity to the Corporation, including available credit facilities, stood at C$ 101.8 million.

Matt Manson, President and CEO, commented: “Stornoway’s Renard Diamond Mine has delivered strong operating margins, with EBITDA of C$ 85 million, despite the lower diamond pricing environment that has characterised our first year of sales. As 2017 ended, Renard had established itself as the lowest cost diamond mine in Canada, and Renard diamonds had developed a strong position in the rough diamond market.”

As operations transition to underground mining during the first half of 2018,  the Company’s key priority will be ensuring an efficient ramp-up of the underground operations, Manson added. Two important capital projects related to the new ore-waste sorting circuit designed to improve the quality of diamond production and provide future processing expansion capacity are also being taken up, he said.

The Company also stated that the rough market has reacted positively to “the qualities, colours and polished yields of the Renard diamond production” leading to “increasing participation in the Corporation’s diamond tenders... despite a challenging rough diamond market in 2017”.

The Company said that its FY2018 production guidance remained unchanged with diamonds recover estimated at 1.6 mn cts at a grade of 65 cpht with sales of 1.1 mn cts of +7 DTC goods at an average price of US$ 125-165 per carat.