Profile: Harry Winston Diamond Corporation (HWD)

Harry Winston Diamond Corporation is a specialist diamond company with assets in the mining and retail segments of the diamond industry. The Company supplies rough diamonds to the global market from production received from its 40% ownership interest in the Diavik Diamond Mine (the Diavik Mine) located at Lac de Gras in Canada’s Northwest Territories. It also owns 100% of Harry Winston Inc. (HWI), a fine jewelry and watch retailer. As of January 31, 2009, the Company’s significant asset was a 40% ownership interest in the Diavik group of mineral claims. The Diavik Joint Venture (the Joint Venture) is an unincorporated joint arrangement between Diavik Diamond Mines Inc. (DDMI-60%) and Harry Winston Diamond Limited Partnership (40%), where the Company owns an undivided 40% interest in the assets, liabilities and expenses. DDMI is the operator (the Operator) of the Diavik Diamond Mine. DDMI is a wholly owned subsidiary of Rio Tinto plc of London, England, and Harry Winston Diamond Mines Ltd. is a wholly owned subsidiary of Harry Winston Diamond Corporation of Toronto, Canada.

Mining

The Company markets its share of production from the Diavik Diamond Mine by means of two sales channels: directly to Tiffany & Co. pursuant to a diamond sales agreement and to the international diamond market, through wholly owned subsidiaries operating in Antwerp, Belgium and Mumbai, India. The Company’s rough diamond clients are based in the major diamond cutting and manufacturing centers of India and Israel, as well as specific customers in the United States and Belgium. Mining segment sales to third parties, including Tiffany & Co., accounted for approximately 54% of the Company’s consolidated revenues for the fiscal year ended January 31, 2009 (fiscal 2009). Since the mine began production during the fiscal year ended January 31, 2003, all production from A154S and A154N has been open pit mining. Production to December 31, 2008, totaled 50.7 million carats of diamonds.

Retail

As of January 31, 2009, HWI sells its exclusive line of diamond focused jewelry and timepieces through eight salons located in the United States, two in the European Union, and eight in the Far East. Harry Winston timepieces and a limited amount of jewelry are also sold through a network of independent retailers and distributors. Sales of jewelry and timepieces by the retail segment accounted for approximately 46% of the Company’s consolidated revenues in fiscal 2009.

HWI jewelry product is designed and supplied from its own design and manufacturing workshop located above the New York salon on Fifth Avenue, supplemented by consignments of gemstones and jewelry from third parties. HWI outsources the manufacture of certain jewelry designs when costs and production quantities warrant.

HWI’s watch factory, located in Geneva, Switzerland, was completed and manufacturing operations commenced in October 2007. Harry Winston timepieces are manufactured by Harry Winston S.A. (HWSA) in Geneva, Switzerland. HWSA manufactures most of its own cases and precious metal bracelets and purchases dials from Les Cadraniers de Geneve. Design, assembly of components and polishing are all completed in HWSA’s watch factory in Switzerland. Harry Winston, Winston, Rare Timepiece, Rare Jewels of the World, and HW Harry Winston Rare TimePieces are the trademarks of HWI.