Diamond company paying out dividends
Dominion reports strong fourth quarter, spending millions on further Ekati exploration
Karen K. Ho
Northern News Services
Wednesday, April 15, 2015
SOMBA K'E/YELLOWKNIFE
Dominion Diamond Corporation's latest report indicates that its Diavik and Ekati mines are expected to be around for a long time despite fluctuations in the Canadian dollar as well as a subdued market for diamonds in the fourth fiscal quarter.
An aerial view of the Misery open pit at Ekati Diamond Mine, located about 310 kilometres northeast of Yellowknife. In its latest quarterly report, Dominion Diamond Corporation said the mine continued to perform well, and that the grade and recovery of diamonds from Ekati were higher than planned. - photo courtesy of BHP Billiton Canada Inc. |
The Yellowknife-based company (TSX: DDC) recently issued its latest quarterly results, which highlighted "continued good performance" as well as higher than planned grade and recovery of diamonds from the Ekati mine, due to implemented process plant improvements. It also detailed planned development work at several specific kimberlite pipes, carrot-shaped igneous rock formations that sometimes contain diamonds. For example, the bulk sample drilling program at the Ekati mine on the Sable pipe has just been completed. However, DDC said next year it plans on spending $6 million on exploration there.
The company said it was also planning to spend $27 million on planned exploration at Ekati's Jay pipe after completing a pre-feasibility study whereby the project was estimated to have a stand-alone after-tax net present value of $610 million.
The company said it has already spent $25.2 million on the Jay pipe from Jan. 31, 2014 to the same time this year.
It also said that due to strong fourth quarter and fiscal 2015 year-end results, its board of directors have declared an income-tax eligible dividend of 40 cents per share. This amount will be paid in full on May 21, to anyone who is a shareholder of the company at the close of business on April 30.
The company's optimistic fourth-quarter earnings release follows the technical report on its Diavik diamond mine, released on March 25, indicated its four kimberlites contain 39.6 million carats of proven mineral reserves (economically mineable material estimated with a high level of confidence) with an additional 13.7 million carats classified as probable mineral reserves.
At press time, DDC's stock price on the TSX was $21.95, down 42 cents or 1.88 per cent, after opening at $22.50 on Monday morning.
