Lucara’s Revenue for Q2 Reaches US$ 79.6 Million
Lucara Diamond Corp. has reported strong performance at its Karowe mine in Botswana for the second fiscal quarter of 2017 with targets being exceeded on all fronts – rough diamond production, sales and price per carat.
The company achieved revenues of US$ 79.6 million or US$ 1,336 per carat from 62,434 carats in Q2 2017, which is more than Q2 2016 results, where the miner has sold US$ 77.7 million at US$ 1,017 per carat from 107,801 carats (figures does not include the 2016 sale of the 813 carat Constellation diamond for US$ 63.1 million). The company noted that the reported revenue for the quarter excludes US$ 0.3 million of proceeds received post Q2 for the company’s June tender.
During the second quarter, Lucara recovered 113 ‘special’ diamonds of more than 10.8 carats, which equated to 5.9 per cent weight percentage of recovered carats. This was in line with expectations and compares to a weight percentage of 4.6 per cent in the second quarter of the previous financial year.
In the financial report, Lucara has admitted to lower its full-year production guidance to between 265,000 carats and 285,000 carats, compared with the previously targeted 290,000 carats to 310,000 carats, as a result of lower mined ore volumes in Q2. As per the report, Lucara’s mining contractor, Aveng Moolmans experienced equipment availability issues during the beginning of the quarter, which resulted in lower than planned ore and waste mined.
As a result of the reduced mined ore volumes, Lucara has also lowered its full-year sales guidance to 260,000 carats to 275,000 carats, compared with the previously targeted 290,000 carats to 310,000 carats. The miner’s forecast revenue for the full-year remains at US$ 200 million to US$ 220 million, excluding any revenue that may be generated from the sale of the 1,109 carat Lesedi La Rona that is currently held in inventory.
The company’s Q2 2017 operating margins were US$ 1,089 per carat or 82 per cent, which is largely due to the company’s first exceptional stone tender in 2017, which achieved proceeds of US$ 54.8 million or US$ 31,010 per carat. Year to date revenue was US$ 105.7 million or US$ 852 per carat achieving a 73 per cent operating margin.
William Lamb, president and CEO, Lucara Diamond Corp. commented, “Sales in the first half achieved extremely strong prices and with our focus on cost control, the Karowe mine continues to deliver strong operating margins. We have worked with our new mine contractor to improve performance during Q2 and Q3, and our mining department is now achieving our productivity targets. Our focus on the process plant is to complete the capital projects, further enhancing diamond recovery by the end of Q3 this year. This will place the Karowe mine in an even stronger position to maximise value from the recovery and sale of diamonds from the high value south lobe.”