VANCOUVER, Aug. 8, 2019 /CNW/ - (LUC – TSX, LUC – BSE, LUC –
Nasdaq Stockholm) Lucara Diamond Corp. ("Lucara" or the "Company")
today reports its results for the quarter ended June 30, 2019.
Please view PDF version of News Release.
HIGHLIGHTS FOR THE QUARTER ENDED JUNE 30,
2019
- A strong operating environment prevailed at the Karowe Mine in
Q2 2019, having met or exceeded guidance with respect to all mining
and processing activities including:
-
- Ore and waste mined of 0.8 million tonnes and 1.8 million
tonnes respectively
- 0.71 million tonnes of ore processed
- Carats recovered of 109,312 (including 8,172 carats recovered
from re-processing historic recovery tailings from previous
milling) achieving a recovered grade of 14.2 carats per hundred
tonnes processed (direct milling carats)
- 225 Specials were recovered from direct milling during the
second quarter, representing 8.1% weight percentage of total
recovered carats, in line with mine plan expectations
- 10 diamonds were recovered greater than 100 carats in
weight
- In May 2019, the Karowe Mine
achieved a significant milestone, passing two years without a lost
time injury.
- In April 2019, the largest
diamond to be mined at Karowe to date was recovered, unbroken,
weighing 1,758 carats. Subsequently named Sewelô following a
contest open to citizens of Botswana, this near gem quality diamond is the
largest diamond recovered in Botswana and one of the largest diamonds
recovered in recorded history, superseding the spot held by the
1,109 carat Lesedi La Rona recovered
from Karowe in 2015.
- During Q2 2019, revenue recognized totalled $42.5 million (Q2 2018: $64.5 million) or $417 per carat (Q2 2018: $856 per carat), consistent with management
expectations and plan.
- Revenue of $91.2 million for the
six months ended June 30, 2019 ("H1
2019") from two tenders surpassed revenue of $89.9 million for the six months ended
June 30, 2018 ("H1 2018") in which
two regular stone tenders and one exceptional stone tender was
held.
- The operating cash cost(1) for the six months ended
June 30, 2019 was $31.16 per tonne processed (H1 2018: $36.64 per tonne processed) compared to the full
year forecast cash cost of $32-$37 per tonne
processed. Operating cash cost per tonne processed was positively
impacted by a reduction in waste mined and an increase in tonnes
processed during the first half of the year.
- Continued excellent operational performance at Karowe has
driven a strong 63% operating margin (H1 2018: 65%) and adjusted
EBITDA(1) year to date of $38.6
million (H1 2018: $37.5
million). Operating expenses per carat sold have decreased
from $225 per carat in H1 2018 to
$171 per carat in H1 2019.
- As at June 30, 2019, the Company
had cash and cash equivalents of $7.1
million. Funds drawn on the credit facility were
$5.0 million utilized for working
capital, leaving $45 million
available on the facility at June 30,
2019.
- The Company paid a quarterly dividend of CA$0.025 per share on
June 20, 2019.
- Rough diamonds with a value of $2.9
million were sold through the Clara platform during H1 2019
and total revenues of $3.5 million
have been achieved since sales began in December of 2018. Clara's
customer base has also grown from four to twenty during the first
half of the year and sales continue to ramp up according to plan,
with the aim of on-boarding third-party production before year-end
and continuing to grow our customer base concurrently with
increasing demand.
- Changes in guidance: as a result of record plant processing
performance over consecutive quarters, annual carat recoveries are
expected to increase to 375,000 - 420,000 carats (previously
300,000 – 330,000 carats) and carats sold to 375,000 - 420,000
carats (previously 300,000 – 320,000 carats) in 2019. Greater asset
availability and utilization together with an improved mine call
factor are driving the change with most of the increases
attributable to enhanced recoveries of small diamonds. Ore tonnes
mined is increased to between 3.0 to 3.4 million tonnes (previously
2.5 to 2.8 million tonnes) as a result of resource gains that
offset planned waste mining in Q1 2019. Cost and revenue guidance
are on track.
Eira Thomas, President & CEO commented: "The largest diamond
to be unearthed in Botswana's 50+
year history and the second +1,000 carat diamond to be recovered at
Karowe in just four years, Sewelô, the 1,758 carat near gem that
was recovered undamaged in April, is a testament to Karowe's
remarkable geological endowment and the strong operating
environment that prevails at the mine. During the second
quarter, Lucara continued to deliver safe, reliable, record diamond
production. Having focused on operational improvements to drive
performance, carat recoveries have significantly increased and
costs have gone down. Overall average prices achieved for our
diamonds during the first half of the year have settled at
$463 per carat and reflect a higher
contribution of fine (smaller) diamonds, with continued strong
recoveries of single diamonds larger than 10.8 carats that
contribute to more than 70% of our revenues. Lucara continues
to achieve high margins for its diamonds and is actively pursuing
organic growth opportunities, including Clara, its proprietary,
cloud based, digital, rough diamond marketplace that continues to
ramp up and has now completed a total of 7 sales since December
2018."
FINANCIAL HIGHLIGHTS
|
Three months ended
June 30
|
Six months
ended June
30
|
In millions of
U.S. dollars, except carats or otherwise noted
|
2019
|
2018
|
2019
|
2018
|
|
|
|
|
|
Revenues
|
$
|
42.5
|
$
|
64.5
|
$
|
91.2
|
$
|
89.9
|
Net income for the
period
|
0.7
|
19.7
|
8.1
|
12.7
|
Earnings per share
(basic and diluted)
|
0.00
|
0.05
|
0.02
|
0.03
|
Cash on
hand
|
7.1
|
49.6
|
7.1
|
49.6
|
|
|
|
|
|
Average price per
carat sold ($/carat)*
|
417
|
856
|
463
|
648
|
Operating expenses
per carat sold ($/carat)*
|
174
|
220
|
171
|
225
|
Operating margin per
carat sold ($/carat)*
|
243
|
636
|
292
|
423
|
|
(*) Average
price per carat sold, operating expenses per carat sold and
operating margin per carat sold are Non-IFRS measures, see Non-IFRS
measures.
|
The Company recognized revenue of $91.2
million or $463 per carat for
its sales in the first half of 2019, yielding an operating margin
of $292 per carat (63%). In
2019, the Company held blended tenders in which diamonds recovered
in the period December 2018 –
April 2019 were sold in the same
period, with the exception of the particularly rare stone
recovered, Sewelô. The Company has completed an initial analysis of
Sewelô and is considering how best to maximize value from this
unique and rare diamond.
In H1 2019, a total of 196,989 carats were sold (H1 2018:
138,646 carats) achieving a year-to-date average price of
$463/carat (H1 2018: $648/carat). The number of carats sold was
42% higher than in the comparative period which is being driven by
better recoveries in the smaller, lower value sizes. While
still profitable, the smaller goods impact the average price per
carat sold when compared to the prior year. The significant
increase in carats is also due to the continued strong performance
in the plant which had record consecutive quarters of production,
processing 1.48 million tonnes during H1 2019 (H1 2018: 1.3 million
tonnes milled). An improved mine call factor also contributed
to higher recoveries of diamonds in the smaller size classes.
Until September 2018, Lucara sold
diamonds through both regular stone tenders ("RST"s) and
exceptional stone tenders ("EST"s). In September 2018, the Company modified its sales
tender to a blended sales tender, combining the sale of exceptional
stones with the balance of run of mine production into one sale.
This change was made to decrease the inventory time for large, high
value diamonds and to generate a smoother revenue profile that
better supports price guidance on a per sale basis. Q2 2018
represented the last quarter in which an exceptional stone tender
was held, accounting for $32.4
million of the $64.5 million
in revenue recognized during that quarter. Beginning in Q4 2018,
certain stones from the Karowe production between 1 and 4 carats
and of better qualities were set aside and subsequently offered for
sale through the Clara platform. The first sale on the Clara
platform took place in December 2018. A further five sales
through Clara were completed in H1 2019, with $2.9 million in value transacted through the
platform and a total of $3.5 million
transacted since sales began. The frequency of sales is
expected to increase during H2 2019, based on increasing demand
from our growing customer base and, according to plan.
Operating expenses increased from $31.2
million in H1 2018 to $33.7
million in H1 2019 due to a combination of an increase in
the average cost per tonne mined and lower volumes of total tonnes
mined. Waste tonnes mined decreased as compared to the same
period in 2018 as the significant waste stripping campaign ("Cut
2") undertaken between 2017 and 2018 was substantially complete by
the end of 2018. In addition, ore mining was stronger than
expected in H1 2019 due to resource gains in the North Lobe that
offset planned waste mining. Due to the higher volume of ore
mined in H1 2019, no waste stripping costs were capitalized and the
strip ratio was reduced to below the life of mine average of 2.46.
No capitalized stripping is expected during 2019 (versus a
strip ratio of 2.84 in 2019 Guidance). The increase in
volumes processed led to a decrease in the operating expense per
carat sold from $225/carat in H1 2018
to $171/carat in H1 2019.
Non-cash depletion and amortization expense increased from
$11.3 million in H1 2018 to
$23.7 million in H1 2019 due to the
42% higher volume of carats sold during the period. Depletion
and amortization expense has increased significantly as compared to
prior periods for several reasons: an increasing number of fine
diamonds recovered following improvements to the processing circuit
implemented in late 2017, a larger mineral property balance from
the waste stripping campaign between 2017 and 2018, and a
corresponding increase in the rate of unit of production depletion
from an update to the reserve base of the mine plan in Q3 2018.
This 110% increase in the non-cash depletion and amortization
expense significantly impacts net income of $8.1 million achieved in H1 2019 (H1 2018:
$12.7 million net income).
Adjusted Earnings Before Interest, Tax, Depletion and Amortization
("Adjusted EBITDA") for H1 2019 was $38.6
million (H1 2018: $37.5
million) (see page 10 Non-IFRS measures).
Q2 2019 performance was underpinned by a continued, strong,
stable operating environment at the Karowe Mine. On the back of
record production achieved during the first quarter of the year,
operations continued to deliver strong performance, with 0.8 and
1.8 million tonnes of ore and waste mined respectively, and 0.71
million tonnes of ore processed. As a result, production yielded
higher carat recoveries against plan and contributed to a sale of
101,931 carats during Q2 2019 which achieved an average price of
$417/carat compared to the sale of
75,329 carats at an average price of $856/carat during Q2 2018. The difference
in average price is due to the exceptional stone tender held in Q2
2018 for which there was no comparable sale in 2019, together with
higher recoveries of small diamonds owing to plant processing
improvements.
Net income and earnings per share performance were as expected
for both the second quarter and year to date results and reflect
the continued strength of production being realized at Karowe from
the investments made over the past two years, as well as the
transition to a blended sales tender in Q3 2018 creating a smoother
revenue profile.
QUARTERLY RESULTS OF OPERATIONS – KAROWE MINE, BOTSWANA
|
UNIT
|
Q2-19
|
Q1-19
|
Q4-18
|
Q3-18
|
Q2-18
|
Sales
|
|
|
|
|
|
|
Revenues
|
US$M
|
42.5
|
48.7
|
40.6
|
45.7
|
64.54
|
Proceeds generated
from sales tenders conducted in the quarter are comprised
of:
|
US$M
|
42.5
|
48.7
|
40.6
|
41.8
|
68.44
|
Sales proceeds
received during the quarter
|
US$M
|
42.5
|
48.7
|
40.6
|
45.7
|
64.5
|
Q2 2018 tender
proceeds received post Q2 2018
|
US$M
|
-
|
-
|
-
|
(3.9)
|
3.9
|
Carats sold for
proceeds generated during the period
|
Carats
|
101,931
|
95,057
|
110,553
|
89,461
|
87,467
|
Carats sold for
revenues recognized during the period
|
Carats
|
101,931
|
95,057
|
110,553
|
101,600
|
75,329
|
Average price per
carat for proceeds generated during the period
|
US$
|
417
|
512
|
367
|
467
|
7824
|
Average price per
carat for proceeds received during the period
|
US$
|
417
|
512
|
367
|
450
|
8564
|
Production
|
|
|
|
|
|
|
Tonnes mined
(ore)
|
Tonnes
|
773,861
|
1,011,048
|
563,279
|
1,217,016
|
702,825
|
Tonnes mined
(waste)
|
Tonnes
|
1,826,972
|
2,485,548
|
2,743,586
|
3,850,225
|
4,416,361
|
Tonnes processed
|
Tonnes
|
713,037
|
763,313
|
602,376
|
728,962
|
698,303
|
Average grade
processed
|
cpht
(*)
|
14.21
|
15.92
|
13.33
|
17.4
|
11.7
|
Carats
recovered
|
Carats
|
109,3121
|
132,3362
|
81,8503
|
127,031
|
81,507
|
Costs
|
|
|
|
|
|
|
Operating costs per
carats sold (see page 12 Non-IRFS measures)
|
US$
|
174
|
169
|
233
|
185
|
220
|
Capital
expenditures
|
US$M
|
3.8
|
2.4
|
6.5
|
2.4
|
2.7
|
(*) carats per
hundred tonnes
|
(1)
|
Carats recovered
during the period included 8,172 carats recovered from
re-processing historic recovery tailings from previous milling and
are excluded from the average grade processed.
|
(2)
|
Carats recovered
during the period included 10,899 carats recovered from
re-processing historic recovery tailings from previous milling and
are excluded from the average grade processed.
|
(3)
|
Carats recovered
during the period included 1,505 carats recovered from
re-processing historic recovery tailings from previous milling and
are excluded from the average grade processed.
|
(4)
|
Q2 2018
includes one EST sale of $32.4 million in addition to an RST during
the quarter
|
Market Update: The market for both rough and polished
diamonds remains challenging due to an excess supply of polished
diamonds and reduced credit available in the mid-stream of the
supply chain. Liquidity issues and concerns over
manufacturers' profitability have resulted in weaker demand, while
global trade disputes and unrest are also contributing factors,
resulting in lower prices for rough diamonds. Weaker demand
has been reported across all size classes and larger producers are
withholding goods or allowing their customers to defer rough
diamond allocations. Lucara's expected production of
approximately 375,000 - 420,000 carats in 2019 accounts for a very
small percentage of total global production, with a majority of
value from the Karowe diamonds attributable to large,
higher-quality diamonds. Lucara's rough diamond sales during
the first six months of 2019 have been consistent with expectations
and in line with 2019 revenue guidance of $170 million to $200
million. Interest in Clara, our online sales platform
for rough diamonds, continues to increase as manufacturers look to
purchase only the rough diamonds that they can use in their
business, while at the same time assuring provenance of the rough
diamonds purchased. While the current market remains
challenging, longer-term supply-demand fundamentals for rough
diamonds are predicted to strengthen as a number of large, world
class diamond mines mature and reach end of life.
SECOND QUARTER OVERVIEW – KAROWE MINE
Safety: Karowe had no lost time injuries during the three
months ended June 30, 2019 resulting
in a twelve-month rolling Lost Time Injuries Frequency Rate
("LTIFR") of 0. In May 2019, Lucara
Botswana and the Karowe Mine achieved a significant milestone,
passing two years without a lost time injury.
Production: Ore and waste mined during the three months
ended June 30, 2019 totaled 0.8
million tonnes and 1.8 million tonnes respectively (H1 2019: 1.8
million tonnes of ore; 4.3 million tonnes of waste). Tonnage
processed was 0.71 million tonnes, with a total of 109,312 carats
recovered (H1 2019: 1.5 million tonnes processed; 241,648 carats
recovered). Included in total carats recovered of 109,312 were
8,172 carats recovered from the re-processing of material
previously milled. During Q2 2019, ore processed was
substantially from the South lobe, with some ore blended from the
Central lobe. During Q2 2019, a total of 225 Specials were
recovered including 10 diamonds greater than 100 carats in
weight. Recovered Specials equated to 8.1% weight percentage
of total recovered carats from direct milling during Q2 2019, in
line with expectations.
Mine performance during the second quarter is consistent with
the record plant performance achieved in the first quarter and is
reflective of significant operational improvements executed in late
2018. The investments made in the plant during 2017 and 2018 are
being realized through increasing recoveries and higher plant
availability. Improvements to maintenance scheduling and equipment
are expected to continue the strong production trend. Ore and waste
mining are meeting or exceeding planned volumes following the
mining contractor transition in mid-2018. Due to the higher volume
of ore mined in Q1 2019 (due to ore gains on the waste contact), no
waste stripping costs were capitalized during H1 2019. Ore mining
is expected to be above guidance for the year due to the resource
gains in the North and Centre pipes, previously categorized as
waste. Total waste mining volumes are expected at the lower
end of guidance for the year while total tonnes mined should remain
within guidance.
Karowe's operating cash cost: Karowe's year to date
operating cash cost (see page 10 Non-IFRS measures) was
$31.16 per tonne processed (2018:
$36.64 per tonne processed) compared
to the full year forecast of $32-$37 per tonne
processed. The decrease in cost per tonne processed compared
to the three months ended June 30,
2018 reflects lower volumes of waste tonnes mined during the
quarter as the significant stripping campaign undertaken between
2017 and 2018 was largely completed in 2018, as well as an increase
in tonnes processed from ongoing plant improvements. Forecast costs
for the 2019 fiscal year are expected to be within guidance and are
trending to the lower end of that guidance.
Labour relations update: In April 2019, the Botswana Mine Workers Union and
Lucara Botswana entered into a Memorandum of Agreement which
governs the working relationship between the two parties. In
May 2019, the parties successfully
negotiated and signed a Salaries and Conditions of Service
Agreement which covers the terms and conditions of employment,
including wages, to March 31, 2021.
In Botswana, a majority of
currently operating mines are unionized.
Naming of the 1,758 carat diamond: the winning submission
for the naming of the 1,758 carat diamond recovered in April 2019 was chosen from over 22,000
submissions in a contest open to all citizens of Botswana. Meaning "rare find" in Setswana, the
name Sewelô was selected for the unbroken, 1,758 carat stone which
was mined from the EM/PK(S) unit of the South Lobe and was
recovered through Lucara's XRT circuit. Lucara is committed
to ensuring that the Sewelô Diamond has a lasting and positive
impact for Botswana and is proud
to have once again invited and engaged with the people of
Botswana to choose the name of
such an iconic diamond recovered at the Karowe Mine.
KAROWE UNDERGROUND UPDATE
Karowe Underground Update
In 2018,
the Company embarked on a technical program to support a
Feasibility Level study for a potential underground operation at
the Karowe Diamond Mine. This program included the completion
of an updated mineral resource, geotechnical drilling of the
country rock and AK06 kimberlite, hydrogeological drilling and
modelling, and mining trade off studies to address risks and issues
identified during the PEA. A total of $21.0 million was spent in 2018 in support of
this work, which resulted in significant de-risking of the key
technical components associated with the potential underground
development.
During H1 2019, $8.4 million was
spent to complete the geotechnical drilling program, geotechnical
and geological logging, downhole geophysical survey, hyperspectral
analysis of core, geotechnical modeling, hydrogeological drilling
and studies, and mine planning activities in support of the ongoing
feasibility study. Field programs were completed in late
April 2019 and the results are being
incorporated into the feasibility study with a planned completion
date in Q4 2019.
2019 OUTLOOK
This section of the press release provides management's
production and cost estimates for 2019. These are
"forward-looking statements" and subject to the cautionary note
regarding the risks associated with forward-looking statements.
Due to an increase in recoveries of smaller-sized diamonds and
overall improved mine call factor, we have increased the number of
diamonds that are expected to be recovered and sold during
2019. While the increase in the number of carats recovered
and expected to be sold in 2019 should have a positive economic
impact, revenues for the year remained unchanged at $170 million to $200
million. A majority of the Company's revenue comes
from the sale of large, single stones in excess of 10.8 carats; the
additional recoveries are in the smaller size classes.
Following an increase in ore tonnes mined which had previously been
classified as waste during Q1 2019, we have also increased guidance
for total ore tonnes mined. No other changes have been made to the
2019 outlook previously provided.
|
|
Karowe Diamond
Mine
|
Full Year –
2019
|
|
|
In millions of
U.S. dollars unless otherwise noted
|
|
Diamond revenue
(millions)
|
$170 to
$200
|
Diamond sales
(thousands of carats)
|
375 to 420 (revised
from 300 to 320)
|
Diamonds recovered
(thousands of carats)
|
375 to 420 (revised
from 300 to 330)
|
Ore tonnes mined
(millions)
|
3.0 to 3.4 (revised
from 2.5 to 2.8)
|
Waste tonnes mined
(millions)
|
6.0 to 9.0
|
Ore tonnes processed
(millions)
|
2.5 to 2.8
|
Total operating cash
costs(1) including waste mined(2) (per
tonne processed)
|
$32.00 to
$37.00
|
Operating cash costs
excluding waste mined (per tonne processed)
|
$21.00 to
$24.00
|
Botswana general
& administrative expenses including marketing costs (per tonne
processed)
|
$2.00 to
$3.00
|
Tax rate
|
22% to 29%
|
Average exchange rate
– USD/Pula
|
10.5
|
(1) Operating cash
costs are a non-IFRS measure. See "Non-IFRS
Measures".
|
(2) Includes ore and
waste mined cash costs of $4.00 to $4.50; processing cash costs of
$12.00 to $13.00 and mine-site departmental costs (security,
technical services, mine planning, health & safety, geology) of
$5.00 to $6.00 (all dollar figures in per tonne mined or
processed).
|
As a result of the increase in ore tonnes mined, the average
strip ratio in 2019 is now expected to be lower than originally
anticipated. No waste capitalization is expected in 2019.
The 2019 estimated cash cost per tonne of ore processed is
expected to be between $32.00 and
$37.00 (2018: $38.00 to $42.00)
while estimated operating cash costs, excluding waste mining, are
expected to be between $21.00 and
$24.00 per tonne processed. The
cost per tonne mined is expected to be between $4.00 and $4.50 and
the estimated processing cost per tonne processed is expected to be
between $12.00 and $13.00, mostly offsetting the increase in cost
per tonne mined which results from higher rates from the mining
contractor appointed in mid-2018.
In 2019, the Company forecasts revenues between $170 million and $200
million, consistent with the forecast for 2018. With
increasing recoveries in the smaller sizes and reprocessing of
previously milled material, diamonds recovered are expected to be
between 375,000 carats and 420,000 carats, an increase from initial
guidance of 300,000 and 330,000 carats, and diamonds sold are
expected to be between 375,000 carats and 420,000 carats, an
increase from 300,000 carats and 320,000 carats. While the number
of carats recovered and sold is expected to exceed our original
guidance for 2019, this increase is not expected to change the
revenue guidance as the Company's revenue is weighted to the larger
stones, or "Specials", which are individual diamonds greater than
10.8 carats. The 2019 revenue projection includes "Specials" but
excludes the sale of any truly unique diamonds such as the 1,109
carat LLR (sold in 2017 for $53
million) and the 813 carat Constellation (sold in 2016 for
$63.1 million). Specials are
consistently recovered from the Karowe Diamond Mine and those
Specials which are gem-quality contribute a significant percentage
of the Company's annual revenue.
Sustaining capital and project expenditures are expected to be
up to $14.0 million in 2019,
including expenditures associated with the construction of an
additional slimes dam, improvements related to the XRT recovery
circuit, and a provision for the implementation of body scanning
technology to enhance security. This does not include investments
being made on the underground development study noted below.
A budget of $14.8 million was
approved to complete a feasibility study that was initiated in
2018, evaluating the potential for an underground mining operation
at Karowe. In 2019, efforts have focused on follow up geotechnical
and hydrogeological drilling and related studies. Exploration
expenditures are estimated to be up to $3.0
million for use of the Sunbird remote mapping technology,
drilling of prospective targets identified by the technology and
work on Lucara Botswana Prospecting License. Please see "Karowe
Underground Update" above.
CONFERENCE CALL
The Company will host a conference call and webcast to discuss
the results on Friday, August 9, 2019
at 7:00 a.m. Pacific, 10:00 a.m. Eastern, 3:00
p.m. UK, 4:00 p.m. CET.
CONFERENCE CALL:
Please call in 10 minutes before the
conference call starts and stay on the line (an operator will be
available to assist you).
Conference ID:
46960261 / Lucara Diamond
Dial-In Numbers:
Toll-Free Participant
Dial-In North America
|
(+1) 888 390
0605
|
All International
Participant Dial-In
|
(+1) 778 383
7417
|
Webcast:
To view the live webcast presentation, please
log on using this direct link:
https://event.on24.com/wcc/r/2049447/0F2C79B4AD2C9CFC526560E05E7A7615
The presentation slideshow will also be available in PDF format
for download from the Lucara website www.lucaradiamond.com shortly
before the conference call.
Conference Replay:
A replay of the telephone
conference will be available two hours after the completion of the
call until August 16, 2019.
Replay number (Toll
Free North America)
|
(+1) 888 390
0541
|
Replay number
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On behalf of the Board,
Eira Thomas
President and Chief Executive Officer
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ABOUT LUCARA
Lucara is a leading independent producer of large exceptional
quality Type IIa diamonds from its 100% owned Karowe Mine in
Botswana. The Company has an
experienced board and management team with extensive diamond
development and operations expertise. The Company operates
transparently and in accordance with international best practices
in the areas of sustainability, health and safety, environment and
community relations.
ABOUT CLARA
Clara Diamond Solutions (Clara), wholly owned by Lucara Diamond
Corp, is a secure, digital sales platform that uses proprietary
analytics together with cloud and blockchain technologies to
modernize the existing diamond supply chain, driving efficiencies,
unlocking value and ensuring diamond provenance from mine to
finger.
The information in this release is accurate at the time of
distribution but may be superseded or qualified by subsequent news
releases.
This information is information that Lucara is obliged to make
public pursuant to the EU Market Abuse Regulation and the Swedish
Securities Markets Act. The information was submitted for
publication, through the agency of the contact person set out above
on August 8, 2019 at 3:30 pm Pacific Time.
NON-IFRS MEASURES
This news release refers to certain financial measures, such as
adjusted EBITDA, average price per carat sold, operating cost per
carat sold, operating margin per carat sold and operating cost per
tonne of ore processed which are not measures recognized under IFRS
and do not have a standardized meaning prescribed by IFRS.
These measures may differ from those made by other corporations and
accordingly may not be comparable to such measures as reported by
other corporations. These measures have been derived from the
Company's financial statements, and applied on a consistent basis,
because the Company believes they are of assistance in the
understanding of the results of operations and financial
position. Please refer to the Company's MD&A for the
second quarter, 2019 for an explanation of non-IFRS measures
used.
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
Certain of the statements made and contained herein and
elsewhere constitute forward-looking statements as defined in
applicable securities laws. Generally, these forward-looking
statements can be identified by the use of forward-looking
terminology such as "expects", "anticipates", "believes",
"intends", "estimates", "potential", "possible" and similar
expressions, or statements that events, conditions or results
"will", "may", "could" or "should" occur or be achieved.
Forward-looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to a number of known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievement
expressed or implied by such forward-looking statements. The
Company believes that expectations reflected in this
forward-looking information are reasonable but no assurance can be
given that these expectations will prove to be accurate and such
forward-looking information included herein should not be unduly
relied upon. In particular, this release may contain forward
looking information pertaining to the following: the estimates of
the Company's mineral reserve and resources; estimates of the
Company's production and sales volumes for the Karowe Mine;
processing capabilities, recovery rates, cash flows and sales
volumes for the Karowe Mine, including the potential effect of the
development and integration of the proposed underground mine at
Karowe on production, sales volumes and the expected life of mine;
estimated costs to construct the proposed Karowe underground
development and the timelines associated therewith; expected
exploration and development expenditures and expected reclamation
costs at the Karowe Mine including associated plans, objectives and
economic estimates; expectation of diamond prices and changes to
foreign currency exchange rate; expectations regarding the need to
raise capital; possible impacts of disputes or litigation, the
timing and ability of management to commercialize the Clara digital
sales platform and other forward looking information.
There can be no assurance that such forward looking statements
will prove to be accurate, as the Company's results and future
events could differ materially from those anticipated in this
forward-looking information as a result of those factors discussed
in or referred to under the heading "Risks and Uncertainties"' in
the Company's most recent Annual Information Form available
athttp://www.sedar.com, as well as changes in general business and
economic conditions, changes in interest and foreign currency
rates, the supply and demand for, deliveries of and the level and
volatility of prices of rough diamonds, costs of power and diesel,
acts of foreign governments and the outcome of legal proceedings,
inaccurate geological and recoverability assumptions (including
with respect to the size, grade and recoverability of mineral
reserves and resources), and unanticipated operational difficulties
(including failure of plant, equipment or processes to operate in
accordance with specifications or expectations, cost escalations,
unavailability of materials and equipment, government action or
delays in the receipt of government approvals, industrial
disturbances or other job actions, adverse weather conditions, and
unanticipated events relating to health safety and environmental
matters).
Accordingly, readers are cautioned not to place undue reliance
on these forward-looking statements which speak only as of the date
the statements were made, and the Company does not assume any
obligations to update or revise them to reflect new events or
circumstances, except as required by law.
SOURCE Lucara Diamond Corp.