Harry Winston Diamond Corporation reports Diavik Diamond Mine Second Quarter 2012 Update

Harry Winston Diamond Corporation reports that in the second calendar quarter of 2012, the Diavik Diamond Mine produced 1.79 million carats from 0.5 million tonnes of ore processed.  Ore volumes processed and diamonds recovered are consistent with the comparable quarter of the prior year.

Ore Type	March and April 2012 Average Price per Carat (in US dollars)
A-154 South	$160
A-154 North	$205
A-418 A Type Ore	$145
A-418 B Type Ore	$100
RPR	$55

For the first half of the calendar year 2012, the Diavik Diamond Mine produced 3.4 million carats from 1.1 million tonnes of ore processed compared to production of 3.1 million carats from 1.0 million tonnes of ore processed in the comparable period of the prior year.  Ore volumes processed for the first half of the current year included production from the A-154 South underground using the sub-level retreat mining method that commenced in July 2011.  Diamonds recovered for the current year are also higher than in the comparable period of the prior year due partially to increased high-grade ore and lower mud-rich type B ore mined from the A-418 kimberlite pipe in 2012.

Diavik's full-year target production remains at 8.3 million carats. Production in the second half of the year is forecast to be higher than the first half of the year due to a ramp-up of carats recovered from A-418 underground plus the processing of approximately 1.0 million carats of reprocessed plant rejects.

The rough diamond market has experienced softened demand since the beginning of the year. The Company held partial rough diamond sales in May and June, and the July sale has just commenced and the Company expects higher than normal rough diamond inventory at July 31, 2012. Based on prices from the Company's last complete rough diamond sale and the current diamond recovery profile of the Diavik processing plant, the Company has modeled the approximate rough diamond price per carat for each of the Diavik ore types in the table that follows. The Company estimates that current market prices have declined by approximately 4% from the beginning of the fiscal year and by approximately 8% since the Company's March/April 2012 sales.