TORONTO, June 7, 2012 /PRNewswire/ --
Harry Winston Diamond Corporation (TSX: HW, NYSE:HWD) (the "Company") today announced its first quarter Fiscal 2013 results for the quarter ending April 30, 2012.
Robert Gannicott, Chairman and Chief Executive Officer stated, "We have improved sales, operating margins and profitability in all sectors of our business compared to the equivalent quarter of the prior year. The Diavik mine continues its transition to underground mining while jewelry and timepiece sales demonstrate our success in broadening the reach of the brand beyond reliance on a small, ultra high end market."
First Quarter Highlights:• Consolidated sales increased 34% to $192.5 million for the first quarter compared to $143.9 million for the comparable quarter of the prior year. Operating profit was $18.7 million compared to $4.7 million in the comparable quarter of the prior year. EBITDA increased 77% to $44.2 million compared to $25.0 million in the comparable quarter of the prior year. • For the mining segment rough diamond sales for the quarter rose 43% to $89.0 million, versus $62.0 million in the comparable quarter of the prior year. The increase was due to a 116% increase in the quantity of carats sold. This was primarily the result of the sale of almost all of the remaining lower priced goods originally held back in inventory by the Company at October 31, 2011 as well as higher production in the first calendar quarter compared to the comparable quarter of the prior year. • The Company sold approximately 1.0 million carats for an average price of $88 per carat compared to approximately 0.5 million carats for an average price per carat of $132 in the comparable quarter of the prior year. The 34% decrease in the Company's achieved average rough diamond prices in the first quarter resulted from a combination of three factors: • The sale of the lower priced goods originally held back in inventory by the Company at October 31, 2011. • The Company's decision to hold back some higher priced goods in the first quarter of fiscal 2013 due to an observed imbalance in the rough and polished diamond prices for these goods. • The Company's January 2012 sale straddled the fiscal 2012 year-end with the lower priced portion of the sale, which occurs in India, pushed into the first quarter. • Had the Company sold only the last production shipped for the first quarter, the estimated achieved price would have been approximately $125 per carat based on the prices achieved in the March/ April 2012 sale. • Rough diamond production for the calendar quarter ended March 31, 2012 was 1.6 million carats compared to 1.4 million carats in the calendar quarter of the prior year (on a 100% basis). • Luxury brand segment sales increased 26% (26% at constant exchange rates) to $103.5 million compared to $81.9 million in the comparable quarter of the prior year. Operating profit increased 68% to $7.1 million in the first quarter compared to $4.2 million in the comparable quarter of the prior year. The increase was primarily driven by positive mix with increased sales of higher-margin access and core products. • Consolidated net profit attributable to shareholders for the first quarter was $11.6 million or $0.14 per share compared to net profit attributable to shareholders of $3.6 million or $0.04 per share in the comparable quarter of the prior year. Fiscal 2013 First Quarter Financial Summary (US$ in millions except Earnings per Share amounts)
Three months Three months ended ended Apr. 30, 2012 Apr. 30, 2011 Sales $192.5 $143.9 - Mining Segment 89.0 62.0 - Luxury Brand Segment 103.5 81.9 Operating profit (loss) 18.7 4.7 - Mining Segment 16.4 4.0 - Luxury Brand Segment 7.1 4.2 - Corporate Segment (4.8) (3.5) Net profit 11.6 3.6 Earnings per share $0.14 $0.04Complete financial statements, MD&A and a discussion of risk factors are included in the accompanying release.