Lucara Reports Strong Q3 Results as Karowe Mine Delivers Major Diamond Recoveries and Advances Underground Project
Toronto-listed Lucara Diamond Corp. reported revenue of $51.2 million from the sale of 101 422 carats during the quarter ended September 30, supported by strong recoveries and continued progress at its Karowe diamond mine in Botswana.
In August, Lucara recovered a 1 015 ct non-gem diamond and a 37.42 ct near-gem pink Type IIa diamond. The 1 015 ct stone is the ninth diamond over 1 000 ct recovered from Karowe and the third such stone recovered this year.
UGP Progress and Funding
Lucara confirmed that the bottom of the production shaft was reached in July, marking a major milestone in the company’s Underground Project (UGP).
The company has drawn $10 million from the $63-million funding support provided by its largest shareholder, Nemesia, issuing an unsecured debenture maturing on June 30, 2031.
Operational Performance
During the third quarter, Lucara recovered 224 special diamonds—stones over 10.8 ct—representing 9.1% of total recovered carats from direct ore feed.
In total, 97 651 carats were recovered, including:
95 302 carats from openpit ore and stockpiles, at a recovered grade of 12.8 cpht
2 349 carats from processing historic recovery tailings
Eight diamonds over 100 ct were recovered in the quarter, including two stones exceeding 1 000 ct.
Operational highlights included 500 000 t of ore mined and 700 000 t processed.
Financial Results
Lucara posted an operating margin of 57%, up from 48% a year earlier.
Key drivers included:
16% increase in revenue
5% reduction in operating costs
Operating cost per tonne processed fell 6% to $25.65/t, compared to $27.34/t in Q3 2024, helped by lower tonnage mined and effective cost management despite inflationary pressures.
The company ended the quarter with:
$18 million cash balance
$190 million fully drawn from the project finance facility for the Karowe UGP
$30 million drawn from the working capital facility
A working capital deficit of $157.8 million, owing to classification of the project facility as a current liability
CEO Commentary
President and CEO William Lamb said Karowe delivered “robust operational performance” supported by strong recoveries and steady UGP progress.
“Our ongoing recovery of large, high-value diamonds, including our ninth stone exceeding 1 000 ct, reinforces Karowe’s reputation as one of the world’s most dependable sources of exceptional gems,” he said.
He noted that shaft sinking and equipping for the UGP is progressing on or above plan, with lateral development now advancing to link the production and ventilation shafts.
Diamond Market Conditions
Lucara said the long-term outlook for natural diamonds remains cautious amid structural market shifts. Prices for lab-grown diamonds continue to fall as production outpaces demand.
Natural diamond production globally is expected to decline following significant guidance cuts from major producers.
Premium large diamonds, however, are showing signs of stability due to limited supply growth.
Mid-range and lower-quality diamonds continue to face pricing pressure due to:
high inventories
cautious consumer sentiment
rapid growth in lab-grown diamond purchases
Karowe Underground Project (UGP)
The UGP is designed to access the highest-value areas of the Karowe orebody. Lucara is reviewing the mining method, cost estimates, and schedule, but states the review does not affect ongoing development work.
Key Q3 UGP achievements include:
Reaching the bottom of the production shaft
Achieving 2 067 lost-time injury-free days
Advancing lateral development on the 310- and 285-levels
Completing major concrete, electrical, and pump installations
UGP spending totaled $22.7 million for the quarter.
Sales Channels
Lucara sells diamonds through:
HB Trading BV supply agreement
Quarterly tenders
The Clara online sales platform
Q3 revenue breakdown:
$38 million from HB (up from $27.8 million)
$11.2 million from tenders (down from $14.6 million)
$2 million from Clara (slightly up from $1.9 million)
HB revenue accounted for 74% of total Q3 revenue.
Lucara reaffirmed its 2025 guidance. Mining this year will include a higher proportion of M/PK(S)4 ore and less EM/PK(S) ore, reducing expected large-diamond volumes and long-term revenue projections for the openpit.
UGP capital expenditure for 2025 is expected to be up to $95 million, revised downward from the earlier $115 million estimate.
Full-scale underground production remains targeted for H1 2028.
