Harry Winston reported that its luxury brand sales totaled $83.5 million in the third quarter, a 4 percent increase from last year. The company saw a net loss of $4.7 million in the quarter, compared with a net profit of $12.7 million in 2010.
“Challenging trading conditions returned to the diamond business internationally in the third quarter,” said chairman and CEO Robert Gannicott in a statement. “However, this was not the sudden, hard shock of 2008/2009 and, being better equipped to weather a downturn than in 2008/9, we elected not to sell the full rough diamond production into a weak market during the quarter but continued to supply the segments where demand remained resilient.”
The company’s mining sales totaled $36.2 million, down 40 percent from last year. The decrease resulted from a 64 percent decrease in volume of carats sold, as the company chose to hold inventory because of market conditions, which was partially offset by a 68 percent increase in achieved rough diamond prices. Harry Winston also reported that rough diamond prices during the third quarter was $159 per carat from 0.2 million carats sold, compared with $95 per carat from 0.6 million carats sold in the comparable quarter of the previous year. Differences in prices resulted from stockpiling of lower-priced diamonds.
Harry Winston also announced that in addition to the recently opened licensed Harry Winston salon in the Dubai Emirate Towers, a second licensed salon is expected to open in Dubai this fiscal year. The company plans to add 10 wholesale watch doors through the remainder of the current fiscal year for a total door count of 200 wholesale timepiece doors. It also expects to open two directly operated salons in Shanghai, and a second directly operated salon in London in the next fiscal year.
Highlights of Harry Winston Diamond Corp.’s third quarter financial statement (ended Oct. 31):
- Consolidated sales: $119.7 million, down 21%
- Mining sales: $36.2 million, down 40%
- Luxury brand sales: $83.5 million, up 4%
- Net loss: $4.7 million, compared with a net profit of $12.7 million last year