RapNet


Rapaport News

 

Mining

 

Advanced search
Latest Articles
Videos
Features
News
Mining
Rough Markets
Polished Markets
Manufacturing
Retail

Lucara Ends Second Quarter at a Loss

Miner halted large-stone tenders amid weak market.
Aug 11, 2020 8:21 AM   By Rapaport News
Print Print Facebook Facebook Twitter Twitter Share Share


RAPAPORT...
Lucara Diamond Corp. reported a loss for the second quarter amid weaker demand and a planned halt on regular tenders of large stones from its Karowe mine.

The company recorded a net loss of $13.9 million for the period ending June 30, compared with a profit of $700,000 during the same period the year before, the company said Monday. 

Revenue from the Botswana deposit plunged 82% year on year to $7.5 million, as sales volume fell 32% to 68,979 carats. The average price slid 74% to $109 per carat as the company only sold smaller stones. Lucara held one tender, in Antwerp in June, with the remainder of supply sold through its Clara platform, which matches buyers with the specific stones they need.

The sales total excludes proceeds from a deal with Antwerp-based manufacturer HB Group, which has agreed to buy all of Lucara’s rough stones above 10.8 carats for the rest of the year. The miner will start realizing revenues from that arrangement in the third quarter, when HB sells the resultant polished and pays Lucara its contracted portion of the proceeds. 

“Lucara made a deliberate decision not to tender any of its [diamonds weighing over 10.8 carats] after March 2020 amid the uncertainty caused by the global crisis,” the company said. “The achieved price in [the second quarter] for the stones…reflects the overall rough-market price erosion.”

Production during the period slipped 7% to 101,203 carats, with the company recovering 201 special-size diamonds, including nine weighing more than 100 carats, two of which were over 200 carats.

Revenue for the first half of the year plummeted 54% to $41.6 million. Sales volume declined 21% to 155,158 carats, with the average price down 42% to $268 per carat. Lucara recorded a net loss of $17.1 million for the six months, compared to a profit of $8.1 million in the same period of 2019.

Lucara has revised its plans for the underground expansion at Karowe, and reduced its previous budget of $53 million for the project, as it still faces uncertainty regarding the revenue it will receive for the stones sold through the HB agreement.

The company plans to withhold its production forecast for the full year indefinitely given the uncertainty caused by the coronavirus pandemic, it said.

Image: Diamond sorters at the Karowe mine. (Lucara Diamond Corp.)
Print Print Facebook Facebook Twitter Twitter Share Share
Tags: Clara, HB Group, Karowe, Karowe mine, lucara, Lucara Diamond Corp., Rapaport News
Similar Articles
Petra Diamonds Finsch mine conveyor beltPetra in the Red as Mines Lose Value
Nov 17, 2020
Petra Diamonds saw heavy losses in the latest fiscal year...
De Beers Exec Jonathan Kendall to Retire
Dominion Nears Deal to Restart Ekati
Comments: (0)  Add comment Add Comment
Arrange Comments Last to First



Call Us: 1-702-893-9400
Member License Agreement   RapNet Trading Rules & Code of Conduct    Privacy Policy  
  
twitter twitter
About Rapaport
Advertise with us