Stornoway names new CEO; posts Q3 loss

Canadian miner Stornoway Diamonds has appointed a new CEO to succeed Matt Manson on January 1, it said on Wednesday, after reporting an adjusted third-quarter net loss of C$31.7-million, sending its shares down 12% on the TSX.

Patrick Godin, currently the COO, will succeed Manson, who has been hailed as the driving force behind the acquisition, financing and development of the Renard diamond mine, in Quebec.

As COO, Godin has been responsible for the construction and development of both the openpit and underground mining operations at Renard.

“Our ramp-up to design capacity at the Renard mine has now been achieved, and carat production is growing. Our product is well established in the international diamond market, and the recently completed financing transactions have strengthened the corporation’s balance sheet. Our priority going forward will be realising the full operating and cash flow potential of the business over the long term. I am confident Pat has the leadership skills required to achieve this task,” commented Manson.

Meanwhile, Stornoway reported revenue of C$29.4-million, derived from the sale of production recovered during the second quarter, when the underground mine was still ramping up with low-grade ore.

Since attaining full design capacity in the underground mine in late August, Stornoway had achieved its best two months in terms of diamond production, with 130 000 ct recovered in September at a grade of 64 carats per hundred tonnes (cpht). Subsequent to the quarter end, 161 000 ct were recovered in October at a grade of 74 cpht.

In the third quarter, diamond production was 329 306 ct from the processing of 597 761 t of ore at an average grade of 55 cpht. Grade and carat recoveries during the quarter improved by 39% and 47%, respectively, compared with the second quarter.

Manson said that weakness in the diamond market continued, particularly in smaller and lower quality items.

“However, the Renard mine is now meeting or exceeding expectations in terms of tonnes mined, tonnes processed and carat recoveries, and we expect to come in within our revised 2018 guidance for carats produced and carats sold, albeit at the lower end of our range based on lower tonnes at a higher average grade,” he stated.

The guidance for the year is to produce between 1.35-million to 1.40-million carats, from the processing of 2.5-million tonnes of ore at a grade of 54 cpht to 56 cpht.

Stornoway traded 12% lower at C$0.22 a share by 14:30 in Toronto.