Diamcor Diamonds Management’s discussion and analysis (MD&A) focuses on significant factors and the operating results and financial position of Diamcor Mining Inc and its subsidiaries. Diamcor notes thereto for the three-month interim period ended December 31, 2024, and the MD&A and unaudited consolidated financial statements for the three-month interim period ended December 31, 2023. The effective date of this MD&A is March 3, 2025.
The unaudited consolidated financial statements for the interim period ended December 31, 2024, have been prepared in accordance with International Financial Reporting Standards (IFRS). According to the key takeaways of the recent and Q3 2024, the Company announced that it had entered into an agreement with Tiffany & Co. Canada to amend the total balance of the outstanding loans between the companies from CAD $6,753.045 to CAD $3,505,256.
The interim period remained challenging for the entire diamond industry, although holiday sales were better than expected for a few of the luxury retailers. The key market of the USA remaining relatively stable, China decreased year over year, with that reduction largely offset by increases from India.
Rough diamond prices in the larger sizes, and those in the better gem categories performed the best during the period, and many in the industry expect there will be continued recovery in a majority of the categories in the second half of 2025.
Virtually all luxury retailers have announced significant marketing campaigns for 2025 promoting the differences in the value proposition, rarity, and desirability of natural diamonds when compared to man-made lab grown alternatives.
Increasingly restrictive sanctions on Russia (~35% of global supply) continued throughout the period, and lower annual production estimates from De Beers for 2025 of 20-23M cts (historically ~35M cts) were announced. Additionally, various other mines have closed or are expecting continued reductions in their production levels as they reach the end of their life-of-mine. These combined elements are aimed at rebalancing excess inventory levels, and combined these items continue to support the potential for shortages of natural rough diamonds from non-conflict areas in the short-term.
Throughout the interim period the Company continued to focus on reducing costs, the advancement of strategic funding to support the resumption of processing at increased levels in 2025, and concurrent bulk sampling to determine the full extent and location of displaced material from Venetia on the remaining 85% of its Krone-Endora at Venetia project.
As a result of the above focus, the Company completed no sales of rough diamonds during the period. In total, ongoing trial mining exercises at the Project from inception thru December 31, 2024, have resulted in the incidental recovery, tender, and sale of 201,461.57 carats of rough diamonds generating revenue at the Project of (USD) $38,736,712.34, resulting in an average price of (USD) $192.52 per carat.
As a result of the noted agreement between the Company and Tiffany & Co. Canada to amend the carrying balance of the outstanding loans, a net gain of $2,355,715 was realized for the interim period ended December 31, 2024 ($1,790,239 loss – December 31, 2023), resulting in a $0.02 per share gain for the interim period ended December 31, 2024 ($0.01 loss – December 31, 2023).
Operating expenses were reduced to $232,066 for the interim period ended December 31, 2024 ($378,013 – December 31, 2023), resulting in a gross margin of -$232,066 (-$324,559 – December 31, 2023). General and administrative expenses were also significantly lower at $284,569 ($459,798 – December 31, 2023).
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