Karelian Diamonds narrows loss

IEX-listed Karelian Diamonds narrowed its half-yearly loss last year, but said it was stepping back from expensive further drilling and micro-diamond sampling and analysis at one of its Finnish operations until stock market interest in junior diamond explorers shows sustained recovery.

The company, which is focused on Finland, recorded a loss of €83,636 for the six months ended November 30th 2009, compared to a deficit of €112,612 in 2008 to €83,636.

"Although the demand for both rough diamonds and jewellery is showing signs of recovery, investor interest in junior explorers remains quite flat. Under such circumstances we have decided to limit the amount of expensive drilling and micro-diamond sampling work we undertake in order to conserve our resources," said chairman Prof Richard COnroy.

"However, we continue to evaluate opportunities on our licences on the Kuhmo and Joensuu areas of Finland and have also submitted a number of new licence applications over other known kimberlites, both near Seitaperä and in the wider Kuhmo area. As market conditions improve, these work programmes will be reviewed."

Prof Conroy said sales of diamond jewellery had shown signs of recovery during the period and sentiment also improved in the rough diamond market, although prices were still eblow highs reached in 2008.