Lucara Diamond Corp. has revised its revenue forecast for the year after a decline in the proportion of large rough diamonds and weaker demand.
The company now expects 2024 revenue to be between $160 million and $180 million, down from its original estimate of $220 million to $250 million. Despite this revision, Lucara has kept its production and sales volume forecast at 345,000 to 375,000 carats. The company’s spending on its underground project is also expected to be lower, with an outlay of around $80 million, down from the previous projection of $100 million.
The revenue revision reflects a drop in the production of high-quality diamonds, combined with a slowdown in the global rough diamond market. Lucara also noted that the reduction in underground project costs is due to the deferral of certain expenses, which will now occur in 2025 instead of 2024.
Lucara sells rough diamonds from its Karowe mine in Botswana through three methods: quarterly tenders, its Clara digital platform, and an off-take agreement with HB for diamonds over 10.8 carats.
In the third quarter, which ended on September 30, Lucara’s revenue fell 21% to $44.3 million. This drop was mainly due to a lower number of large diamonds sold through the HB agreement. Sales from this channel, which make up 63% of total revenue, decreased from $38.4 million in the same period last year to $27.8 million. The company’s sales volume grew by 4%, reaching 116,221 carats, but profits fell sharply to $200,000 from $11.7 million in 2023.
Lucara’s output increased by 6%, totaling 104,390 carats, with most of it coming from direct ore (96,597 carats) and the rest from processing tailings (7,793 carats). During the quarter, the company recovered 244 special-sized diamonds, including 12 larger than 100 carats. Among them were three diamonds weighing over 300 carats, including a 2,488-carat diamond and a 1,094-carat stone.
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