Dia Met Minerals Announces First Quarter Results From Ekati Diamond Mine, Net Earnings of $13.2 Million or $0.43 per Share.Business Editors KELOWNA Kelowna (kĭlō`nə), city (1991 pop. 75,950), S British Columbia, Canada, on Okanagan Lake. Kelowna is a tourist resort and serves as a trade center for a fruit-growing and lumbering area. , B.C.--(BUSINESS WIRE)--June 26, 2000 Dia Met Minerals Ltd.(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :DMM See multimeter. DMM - Digital Multimeter .A.) (AMEX AMEX See: American Stock Exchange :DMM.A) (TSE:DMM.B.) (AMEX:DMM.B) today announced net earnings of $13.2 million or basic earnings per share of $0.43 for the three months ended Apr. 30, 2000. Dia Met's equity in earnings from its 29 per cent-owned Ekati Ekati may refer to:
In total, Ekati(TM) produced 619,000 carats of diamonds for the three months, and sold 727,000 carats at an average price of US$168 per carat CARAT, weights. A carat is a weight equal to three and one-sixth grains, in diamonds, and the like. Jac. L. Dict. See Weight. . Dia Met's share of diamond sales from Ekati(TM) for the quarter amounted to $52.3 million from which $16.0 million for cost of sales and $4.8 million for amortization and depreciation were deducted de·duct v. de·duct·ed, de·duct·ing, de·ducts v.tr. 1. To take away (a quantity) from another; subtract. 2. To derive by deduction; deduce. v.intr. to yield equity in earnings of $31.5 million. In the same quarter the previous year, production at Ekati(TM) amounted to 567,000 carats with sales of 463,000 carats at an average price of US$145 per carat. Dia Met reported net earnings of $3.2 million or basic earnings per share of $0.11 for the quarter ended Apr. 30, 1999. "It is extremely gratifying grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. that Ekati(TM)'s initial healthy financial performance has been maintained. The mine has now established itself as a world-class asset by any standards with a gross margin for the quarter of 69 per cent and a pre tax profit margin of 60 per cent," said James Eccott, Dia Met's President and Chief Executive Officer. Mr. Eccott said diamond prices remained buoyant Buoyant The term used to describe a commodities market where the prices generally rise with ease when there are considerable signals of strength. Notes: These types of markets can be very volatile as the prices are rapid to rise and fall with investor sentiment. with sales from Ekati(TM) averaging US$168 per carat, 29 per cent higher than the US$130 set out in the 1997 feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. and among the highest for any kimberlite kimberlite: see diamond. kimberlite or blue ground Dark, heavy, often fragmented igneous rock that may contain diamonds in the rock matrix. mine in the world. "Ekati(TM) production has a number of very favourable characteristics. It includes a wide range of sizes and qualities of gem gem, ornamental mineral or organic substance gem, commonly, a mineral or organic substance, cut and polished and used as an ornament. Gems also are used as seals (items of assurance) and as talismans (good-luck charms). For birthstones, see month. diamonds, making it less vulnerable to market fluctuations which can affect certain categories," added Eccott. "The bulk of the value is in white, commercial goods. Typically, these are I-plus in colour and SI1-plus in clarity. When polished, they are easily sold and are in high demand in the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. market." Dia Met's outstanding debt obligations for Ekati(TM) totalled $183.4 million at Apr. 30, 2000, down from $204.7 million at Jan. 31, 2000. This reflects the net impact of $25.4 million of debt repayments in the quarter, offset by interest charges of $4.0 million and $88,000 of development costs. Dia Met continues to apply 100 per cent of its share of net after-tax cash flows to repayment of these obligations as it has since the start of production at Ekati(TM) in October 1998. Starting with the first quarter of the current fiscal year, Dia Met has changed its method of accounting for exploration costs. Previously, exploration costs were capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. and reported on the balance sheet as an asset. Costs were only expensed when the exploration project to which they related was abandoned or went into production. Under the new policy exploration costs are expensed as incurred. Their impact on net earnings and earnings per share is immediate. The change has been applied retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin . The new policy brings Dia Met in line with accounting practice in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and with most medium and large Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. resource companies. The impact of the policy on the quarter ended Apr. 30, 2000, is a reduction in after tax earnings of $1.36 million or $0.04 per share. On June 2, 2000, the Company reorganized re·or·gan·ize v. re·or·gan·ized, re·or·gan·iz·ing, re·or·gan·iz·es v.tr. To organize again or anew. v.intr. To undergo or effect changes in organization. its investment in Ekati(TM). Dia Met's Ekati(TM) investment and obligations are now held by Dia Met Minerals (NWT NWT or N.W.T. abbr. Northwest Territories NWT Northwest Territories (of Canada) ) Ltd., a wholly-owned Northwest Territories Northwest Territories, territory (2001 pop. 37,360), 532,643 sq mi (1,379,028 sq km), NW Canada. The Northwest Territories lie W of Nunavut, N of lat. 60°N, and E of Yukon. subsidiary of the Company. This separates the Company's investment in Ekati(TM) from the company's other activities, which is considered prudent business practice. The transfer has no impact on the consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge of Dia Met. Dia Met Minerals Ltd. is a publicly traded mineral exploration and development company with a primary focus on diamonds. The company owns a 29 per cent interest in the Core Zone joint venture of the Ekati(TM) Diamond Mine, Canada's first and only diamond mine. BHP BHP blood hydrostatic pressure; the pressure exerted by the blood cells and plasma in the capillaries. Diamonds Inc. is the operator of the mine, which commenced production in October 1998. In addition to the investment in the Ekati(TM) Diamond Mine, Dia Met is carrying out extensive global exploration in Mauritania, Greenland, Finland and the Canadian North
SIGNED ON BEHALF OF THE BOARD OF DIRECTORS James E. Eccott, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and President Summarized financial highlights (reported in Canadian [pilcrow (paragraph sign)] dollars) compared with January 31, 2000 and the three months ended April 30, 1999 are as follows:
CONSOLIDATED BALANCE SHEETS
(unaudited)
(000's)
April 30, January 31,
2000 2000
Assets
Current assets
Cash $ 145 $ 2,428
Temporary investments 12,324 15,486
Amounts receivable 668 618
---------------------
13,137 18,532
Capital assets 2,444 2,473
Investment in the Ekati(TM) Diamond Mine 285,560 279,827
---------------------
$ 301,141 $ 300,832
---------------------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities $ 746 $868
Current portion of obligations for the
Ekati(TM) Diamond Mine 44,721 56,336
---------------------
45,467 57,204
Obligations for the Ekati(TM) Diamond Mine 138,680 148,435
Future income taxes payable 24,704 13,629
Shareholders' equity
Share capital 79,435 79,435
Shares repurchased under normal
course issuer bid (5,786) (3,336)
Retained earnings 18,641 5,465
---------------------
92,290 81,564
---------------------
$ 301,141 $ 300,832
---------------------
CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS (DEFICIT)
(unaudited)
Three months ended April 30, 2000 and 1999
($ 000's)
2000 1999
Revenue
Equity in earnings of the Ekati(TM)
Diamond Mine $ 31,497 $ 15,530
Aircraft operations 95 11
Interest and other income 872 407
---------------------
32,464 15,948
Expenses
Interest on obligations for the Ekati(TM)
Diamond Mine 4,301 5,568
Amortization of capitalized interest and
direct expenditures on the Ekati(TM)
Diamond Mine 418 418
Exploration 2,483 2,666
General and administrative 717 920
Depreciation 56 45
Aircraft operations 40 3
---------------------
8,015 9,620
---------------------
Earnings before income taxes 24,449 6,328
Income taxes
Current 198 180
Future 11,075 2,921
---------------------
11,273 3,101
---------------------
Net earnings for the period 13,176 3,227
Retained earnings (deficit), beginning
of period as previously stated 20,229 (18,925)
Change in accounting policy (14,764) (9,532)
---------------------
As restated 5,465 (28,457)
---------------------
Retained earnings (deficit) end of period $ 18,641 $ (25,230)
---------------------
Earnings per share, basic $ 0.43 $ 0.11
---------------------
Earnings per share, fully diluted $ 0.40 $ 0.10
---------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Three months ended April 30, 2000 and 1999
($ 000's)
2000 1999
Cash provided by (used in)
Operations
Net earnings for the period $ 13,176 $ 3,227
Items not involving cash:
Depreciation and amortization 474 463
Future income taxes 11,075 2,921
Undistributed earnings of the Ekati(TM)
Diamond Mine (6,063) (15,530)
Changes in non-cash operating working capital
Amounts receivable (50) 795
Accounts payable and accrued liabilities (122) (216)
Income taxes payable - (197)
---------------------
18,490 (8,537)
---------------------
Investing activities
Decrease in temporary investments 3,162 4,354
Investment in the Ekati(TM) Diamond Mine (88) -
Purchase of capital assets (27) (32)
---------------------
3,047 4,322
Financing activities
Increase in obligations for the Ekati(TM)
Diamond Mine 4,063 5,568
Repayment of obligations for the Ekati(TM)
Diamond Mine (25,433) -
Shares issued for cash - 334
Shares repurchased under normal course
issuer bids (2,450) (1,507)
---------------------
(23,820) 4,395
---------------------
Increase (decrease) in cash (2,283) 180
Cash, beginning of period 2,428 93
---------------------
Cash, end of period $ 145 $ 273
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The American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. , Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. and the Canadian Venture Exchange The Canadian Venture Exchange (CDNX) is now a defunct stock exchange having been acquired by the TSX Group in 2001 and renamed the TSX Venture Exchange. History of the Canadian Venture Exchange (CDNX) have neither approved nor disapproved the information contained in this release. |
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