Lucara Diamond Corp has reported third quarter results for year 2012 in which it showed revenues stood at US$ 12.7 million.
During the period, the Botswana Stock Exchange listed company completed two diamond sales at Karowe totalling 88,579 carats during the third quarter resulting in proceeds of $19.9 million. The company declared commercial production at Karowe as at July 1, 2012 and successfully achieved design throughput by August.
At Mothae, a September sale of 4,657 carats resulted in proceeds of $1.5 million. The trial mining program was completed in September and work advanced on its preliminary economic assessment due to be completed during the first quarter of 2013.
William Lamb, President and Chief Executive Officer says they are pleased with performance during the past quarter, having successfully achieved design capacity at Karowe and completing two diamond sales at an average diamond sales price of $225 per carat.
“We are focussed on performance and cost control, which resulted in a cash operating margin of 46% for our September sale with operating expenses of $107 per carat. While the rough diamond market remains challenging, we are pleased with Karowe’s pace and stage of development and we continue to improve production while maintaining our outstanding safety record with zero lost time injuries this year,” says Lamb.
At Karowe Mine – Botswana (formerly AK6 Diamond Project), the commercial Production was declared as of July 1, 2012. As a result, diamonds produced and sold post July 1, 2012 are recognized as revenue in the Company’s condensed interim consolidated statements of operations. The July sale and 489 carats of diamond sold in the September sale included diamonds produced prior to July 1, 2012 and their earnings were netted against capitalized project costs in the condensed interim consolidated balance sheet.
The company completed two sales totalling 88,579 carats for proceeds of $19.9 million during the quarter in the months of July and September. The sales achieved an average sales price of $179 per carat for the July sale (with some high value lots withheld) and $257 per carat in the September sale, which included three lots of diamonds previously withheld.
Lucara says operating expenses per carats sold in the September sale was $107 per carat and cash operating earnings reported for the September sale (excluding depreciation, amortization and depletion) was $5.9 million or 46% of gross revenue.
It says average grade processed during the quarter was 15.4 carats per hundred tonnes. Year to date grade processed was 19.6 carats per hundred tonnes, which was marginally below forecast.
At Mothae Project – Lesotho, in September, Mothae sold 4,657 carats produced during the test mining phase for proceeds of $1.5 million or an average price of $324 per carat.
Lucara says cash on hand was $11.1 million at September 30, 2012 including a $7 million drawdown from the Company’s Scotiabank credit facility.
“In July, the Company renegotiated the terms of its $50 million debenture. Under the amended terms of the agreement each scheduled principal payment has been extended by six months resulting in payments commencing in March 31, 2013 and a final maturity date of June 30, 2014. All other terms and conditions of the debenture agreement remain unchanged with no penalties being incurred.”