Lucara Diamond Corp.’s sales and profit fell in the second quarter amid lower-quality production from its Karowe mine and a drop in the average price.
Revenue declined 19% year on year to $64.5 million for the three months ending June 30, even as sales volume rose 26% to 75,329 carats, the company reported Wednesday. The average selling price slid 36% to $856 per carat. Profit slumped 39% to $19.7 million.
While Lucara recovered a higher quantity of large diamonds, the revenue drop reflected the absence of top-quality stones of the type the miner sold in the same period last year. Those included a 373.72-carat shard — once part of the Lesedi La Rona — that fetched $17.5 million in May 2017.
Lucara recovered 253 special-size diamonds — over 10.8 carats — during the period, the highest number of specials it has recovered in a single quarter. Of those diamonds, 11 weighed over 100 carats, including three that exceeded 300 carats. Twelve stones sold for more than $1 million each.
The quarterly revenue excludes $3.9 million Lucara received in July for diamonds it sold in June.
The company also increased its resource estimate for the AK06 project at the south lobe of its Karowe asset in Botswana by 54%, from an earlier range of 4.4 million to 6.8 million carats. Lucara intends to shift its focus to the south lobe, where the miner has recovered larger and higher-value stones than those in the north or center lobes.
Lucara expects to produce between 270,000 and 290,000 carats this year, and has forecast revenue of $170 million to $200 million, in line with its previous outlook. Revenue for 2017 was $220.8 million, boosted by the $53 million sale of the Lesedi La Rona.
More about Lucara
Lucara Diamond Corp. is a diamond exploration and mining company, operating in southern Africa but established in Canada. In November 2015, Lesedi La Rona, the world’s second largest gem-quality diamond ever found, was found at the Karowe mine in Botswana.
On 18 November 2015, the company announced the discovery of the Lesedi La Rona, the world’s second largest gem-quality diamond ever (second only to the 3,106 carat Cullinan). The type IIa diamond was found in the company’s Karowe mine in north-central Botswana. The diamond weighs 1,111 carat and measures 65 by 56 by 40 mm. A day later, two more diamonds weighing 813 and 374 carat, were also found. All the stones came from the AK6 pipe opened 18 months earlier, it has since yielded over 1 million carats of diamonds. The company has sold the 813 carat Constellation in May 2016 for $63.1 million and a 341.9 carat diamond in July 2015 for $20.6 million.The Lesedi has since sold for $53 million.