Finance costs push Canadian miner in which Dermot Desmond is largest shareholder to a net loss
Dermot Desmond is the largest shareholder in Mountain Province Diamonds which has reported falling sales and a net loss after debt financing. Photograph: Cyril Byrne, has seen its revenue drop this year, fresh company filings show. That has triggered concern that the company might not be able to fund ongoing operations, requiring it to raise fresh funding in the near future, the filings state.with diamond industry giant De Beers , had total sales of 215.
In the notes to the accounts the directors state that “the company is forecasting a cash flow shortfall during the next 12 months based on management’s expectation of diamond production, sales, prices and costs”.Innovation Awards finalist: Bean Around - making sustainable skincare products from coffee groundsIt will also have to deal with “the upcoming maturity of the senior secured notes with an outstanding principal amount of US$177 million which mature on December 15th, 2025″, it said.
They warn that a “failure to meet the obligations for cash calls to fund the company’s share of expenditures at the GK Mine may lead to De Beers Canada Inc. enforcing its remedies under the joint venture agreement”. This could result in the “the dilution of the company’s interest in the GK Mine” as well as “cross-default clauses” contained in some of its loans.
Dermot Desmond is the largest shareholder in Mountain Province, with about 36 per cent of the shares. He also holds large tranches of the company’s junior debt, having had to step in several times over recent years to support the business through difficult periods in the diamond sector.
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