Aber Diamond Profits up 28%; Completes Full-Ownership of Harry Winston

Aber Diamond Corp. said Friday that its full-year earnings rose 28 percent to $104.3 million. Sales for the year, ended Jan. 31, rose to $558.8 million, up from $505.2 million in the prior year.

The Toronto-based company said in its report that tax reductions and favorable foreign exchange rates offset an early closure of the winter road to the Diavik mine in the Northwest Territories and the costs of acquiring full ownership in the Harry Winston jewelry-store chain.

“By concluding the purchase of 100 percent of Harry Winston, Aber has brought the knowledge bases of the two most important ends of the diamond spectrum together in one diamond company that delivers improved pricing both in rough diamond sales from the mine and polished diamond purchases for the jeweler,” said Aber chairman and chief executive officer Robert Gannicott. “The Diavik mine is developing both an underground mine and a new open pit while our jewelry business continues to open more salons in prime luxury retail locations.”

The company reported a net income of $27 million in its fourth quarter ended Jan. 31, up from $15 million in the prior-year period, as sales increased 22 percent to $154 million. Quarterly operating income rose $1 million to $37.1 million.

At the Diavik mine, Aber’s 40 percent share of production was up by 19 percent on the year to 3.9 million carats and by 36 percent in the fourth quarter to 997,000 carats. Operating cost was $26 per carat in the quarter, down from $28 a year earlier, but for the full year rose two dollars to $25. The mine is co-owned with Rio Tinto PLC.

Annual sales from the mining segment rose 6 percent. Earnings from mine operations fell 12 percent to $144.5 million because of extra transport costs caused by restricted use of the ice road because of warm weather in early 2006, the company said.