42 per cent jump at Dia Met Minerals
Doug Ashbury
Northern News Services
Yellowknife (Dec 20/00) - There's no word yet on suitors for Canada's lone diamond miner.
Dia Met Minerals announced Oct. 17 it was putting itself up for sale after Marlene Fipke and David Mackenzie, who control 38 per cent of Dia Met's shares, served notice they planned to sell their shares.
In the recent nine-month financial results report, Dia Met said the process of selling the company "is expected to continue over the next few months."
For the first three frames of 2000, Dia Met's profits are well ahead of last year. Through Oct. 31, Dia Met Minerals Ltd., 29 per-cent owner of the Ekati diamond mine, made $37.5 million, or $1.22 per basic share, compared to a $26.4 million profit, or 88 cents per share, for the same period in 1999.
Dia Met's equity in earnings totalled $88.1 million for the latest nine-month period, up from $76.8 million a year earlier.
In total, Ekati produced 1,977,000 carats of diamonds for the nine months and sold 1,937,000 carats at an average price of $169 US per carat. Production at Ekati for the same period the previous year was 1,939,000 carats, with sales of 1,757,000 carats at an average price of $165 US per carat.
There were eight sales of rough diamonds during both nine-month periods.
Dia Met's share of diamond sales from Ekati for the latest nine-month period totalled $142.4 million, from which $41.4 million was deducted for cost of sales, and $12.9 million for amortization and depreciation, yielding the equity in earnings of $88.1 million.
Dia Met's outstanding net debt obligations for Ekati totalled $133.8 million at Oct. 31, 2000, down from $204.8 million at Jan. 31, 2000. This reflects $82.7 million of debt repayments for the period, offset by $11.7 million of interest charges and other costs.
The company is currently applying 90 per cent of its share of after-tax cash flows from Ekati to debt repayment, and 10 per cent to fund corporate activities.
Credit Suisse First Boston Corporation was hired as investment adviser for the sale of the company.
