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Lucara Lifts Production Outlook

Miner sees higher recovery of smaller diamonds in third quarter.
Nov 11, 2018 10:48 AM   By Rapaport News
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RAPAPORT... Lucara Diamond Corp. raised its production forecast for the full year after recovering more carats in the third quarter than it had anticipated.

A strong operational performance at the Karowe mine’s processing plant resulted in improved recovery of smaller diamonds, Lucara said Thursday. The miner now expects to recover 325,000 to 350,000 carats in 2018, versus a previous estimate of 270,000 to 290,000 carats.

“Third-quarter operational performance at Karowe exceeded expectations with respect to ore mined and carats produced, and reflects a seamless transition, three months ahead of schedule, to our new mining contractor,” said Lucara CEO Eira Thomas. “In parallel, we saw higher asset availability and record utilization rates for the process plant, positively impacting carat recoveries.”

The higher production will have a minor impact on sales, as most of Lucara’s revenue is from large stones. The company therefore didn’t raise its sales forecast. It did, however, revise it slightly to between $180 million and $190 million, compared with its earlier range of $170 million to $200 million.

Total production more than doubled to 127,031 carats in the third quarter from 62,425 carats a year ago. Revenue declined 41% to $45.7 million, as the same period last year included the $53 million sale of the 1,109-carat Lesedi La Rona. The average selling price plunged 61% to $450 per carat due to the absence of that exceptional stone, though sales volume jumped 51% to 101,600 carats. Net profit slumped 84% to $5.1 million.

Lucara recovered 197 diamonds over 10.8 carats from its Karowe mine in Botswana during the period, including 10 that weighed more than 100 carats, the company noted.

Image: Karowe mine. (Lucara Diamond Corp.)
Tags: Eira Thomas, Karowe, Karowe mine, Lesedi La Rona, lucara, Lucara Diamond Corp., Rapaport News
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