Releasing production and sales results for the period ended December 31, 2019, Mountain Province Diamonds said that production at the Gahcho Kué diamond mine in Canada was better than the Company's expectations, with recovered carats for FY 2019 coming in higher than the revised guidance of 6.7 – 6.8 million carats, attributable to the strong operational performance in Q4 2019, though sales dipped by 2%.

Gahcho Kué is a JV between Mountain Province and De Beers Canada.

Giving details, the miner said that carats recovered in Q4 stood at 1,977,438 at an average grade of 2.11 carats per tonne, 28% higher than comparable quarter (Q4 2018: 1,545,786 carats at 2.06). For the year as a whole 6,820,631 carats were recovered at an average grade of 1.90 carats per tonne, 2% slightly lower than the comparable period (FY 2018: 6,936,894).

The higher recovery in Q4 came on the back of a 33% increase in ore tonnes mined and a 25% increase in ore tonnes treated, with both parameters up by 12% during the year as a whole, Mountain Province reported.

In Q4 2019, 771,799 carats were sold at an average value of US$ 64 per carat for total proceeds of US$ 49.2 million in comparison to 822,548 carats sold at an average value of US$ 65 per carat for total proceeds of US$ 53.6 million in Q4 2018.

During FY 2019, 3,284,520 carats were sold at an average value of US$ 63 per carat for total proceeds of US$ 208.2 million in comparison to 3,252,491 carats sold at an average value of US$ 74 per carat for total proceeds of US$ 240 million in FY 2018.

The Company noted that sentiment in the rough diamond market became slightly more optimistic towards the end of 2019 and has remained relatively positive as the market prepares for the first selling cycle of 2020.

The medium to long term outlook for rough diamonds, remains positive, it added. The major producers reported lower levels of sales through 2019 which, together with the stronger retail selling season, will help normalise inventory levels in the cutting centers. In addition, anticipated mine closures over the next 12 – 18 months will help to establish a more balanced supply and demand equilibrium in the diamond market, Mountain Province stated. Importantly, consumer confidence and spending remain strong, particularly in the US and Greater China which together account for approximately 65% by value of global retail sales of diamond jewellery, the Company opined.

Mountain Province also expects that Q4 2019 and FY 2019 costs will be in line with revised guidance previously provided.

Stuart Brown, the Company's President and Chief Executive Officer, commented: "Mountain Province enjoyed an exceptional year of production in FY 2019, achieving all its operational metrics. The highlight being exceeding plant throughput by 12%, compared to FY 2018. The improvements were a direct result of the plant modifications over the past 12 months. The effort and hard work by everyone involved in this project is to be commended.”

Stating that “the diamond market however was somewhat difficult in 2019 with prices declining further in some categories”, Brown added that there were positive signs seen late in 2019 which strengthened early in 2020. “Retailers across all sectors of the luxury market have been reporting stronger than expected holiday season sales with very strong growth in online sales also boosting diamond retail sales,” he noted.

Looking forward, Brown commented, “Following the successful plant changes which have created more capacity and opportunity, I believe Mountain Province is well positioned for the next decade. Gahcho Kué has a long mine life, and as demonstrated in 2019 with the discovery of the Wilson Kimberlite a strong potential for additional discoveries in our highly prospective land package."