Lucara Diamond, the owners of Karowe mine in Botswana has improved its net cash position over the last year as the company continued to report sales on exceptional diamonds discovered at its flagship project.
According to its first quarter results, the net cash position has improved compared to the loss on the corresponding period.
The company’s quarter-end cash balance was $56.8 million (about P491.8 million) compared to a net debt position of $26.2 million (about P226.8 million) in the previous year and $49.4 million at the end of 2013.
In addition to production costs of $118 per carat the company spent $1.9 million on Karowe’s plant optimisation project and paid the December 2013 tender royalty and 2013 employee bonus payments during the quarter.
“Lucara has had a strong start to the year with continued production performance from the mine team and two successful tenders during the first quarter generating revenue in excess of $30 million,” Chief Executive Officer William Lamb, said.
“We have brought forward our second Exceptional Stone Tender to early in the third quarter due to the sustainable recovery of large stones
with more than 330 special stones (+10.8 carats) recovered to date.
This follows very strong results from our first Exceptional Stone
Tender in 2014, which was held in early April for proceeds of $50 million,” he added. Lucara reported proceeds of $33.5 million from two diamond sales during the period with net earnings of $5.1 million and cash flows of $13.1 million generated from operations before working capital
adjustments.
Karowe performed better than budget in terms ore mined and carats recovered during the period. Waste mining was marginally below budget during the period and plans are in place to meet full year budget volumes. The Company recovered 111,037 carats including 188 special
stones (+10.8 carats) during the period.
The mine’s Lost Time Injuries Frequency Rate (“LTIFR”) for the quarter was zero as there were no Lost Time Injury (“LTI’s”) and no reportable environmental incidents during the period. LTIFR is defined as the total number of work hours lost per 200,000 work hours.
Proceeds of $750,000 were received after the quarter and will be accounted for in Q2 revenues. The average price of $312 per carat compares to $225 per carat for the first quarter in the prior year.
Revenues during the period, which exclude the proceeds received after period end, were $32.8 million for the period. At an average operating expense of $118 per carat, the cash operating margin during the quarter was $187 per carat.
