Lucara Diamond Corp. · TSX:LUC
Lucara Diamond — Q3 2023 Earnings Presentation
26 slides from Lucara Diamond's earnings presentation, Nov 13, 2023
Slide 1: Q3 2023 Results Conference Call
Q3 2023 Results Conference Call NOVEMBER 13, 2023 LucaraDiamond.com | LUC.TSX | LUC.XSTO | LUC.BSE
Slide 2: Cautionary Statement
There can be no assurance that such forward looking statements will prove to be accurate, as the Cautionary Statement 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
Slide 3: Q3 2023 Highlights
Q3 2023 Highlights (All currency figures in U.S. Dollars, unless otherwise stated) Revenues $56.9 million; Cash flow of $15.9 million Recovery of fourth Karowe UGP shaft sinking Adjusted EBITDA1 of Operating cost $28.62 diamond in excess of and grouting programs $21.9 million per tonne processed1 1,
Slide 4: Karowe Underground Expansion – Q3 Update
Karowe Underground Expansion – Q3 Update $20.3 million invested in Q3 Sinking and grouting programs continued in both the ventilation and production shafts; the ventilation shaft has completed sinking through the water-bearing sandstone units and the production shaft was sinking through the bottom p
Slide 5: Karowe Underground Expansion – Q4 Focus Areas
Karowe Underground Expansion – Q4 Focus Areas Up to $105 million capital cost in 2023 Sinking within the ventilation and production shafts Excavation of the 718 level station in the ventilation shaft and sinking to the 670 level station; start of station development Planned grouting event to the bas
Slide 6: Consistent Recovery of Large Diamonds
Consistent Recovery of Large Diamonds Specials contribute ~60-70% by revenue and ~5-7% by volume historically Since 2012: 35 diamonds in Over 11 diamonds sold for > US$10 First Years of Underground Production excess of 300 carats have million, represents US$237 million are dominated by EM/PK(S) ore
Slide 7: Q3 2023 Recovered Specials
Q3 2023 Recovered Specials Highlights 6 diamonds greater than 100 carats including 3 diamonds greater than 300 carats ✓ 189 recovered Specials ✓ 84% of carats recovered from the South Lobe ✓ 6.8 wt.% of production ✓ 16% of carats recovered from the Centre Lobe 1,080 carat Type IIa white gem quality
Slide 8: Sales Channels
Sales Channels Optimized Sales of Rough and Polished Diamonds to Create Alignment Along the Supply Chain and Maximize Revenues Rough Clara Polished Increasing Margin Capture Along the Value Chain Tenders (Auctions) of Proprietary Digital Manufacturing into Rough Diamonds < 10.8 Marketplace for Rough
Slide 9: Q3 2023 Update
Q3 2023 Update $4.4 million transacted in Q3 2023 88 sales completed Continuing to focus on adding third-party supply, both from primary diamond producers and secondary market sources; 16% of goods from third-party sources +$100 million sold by value Growth potential in primary & secondary ~56,000 c
Slide 10: Q3 2023 Operational Highlights – Karowe Mine
Q3 2023 Operational Highlights – Karowe Mine Three months ending September 30, 2023 (All currency figures in U.S. Dollars) Ore mined (tonnes) Ore processed (tonnes) 920,410 724,640 869,188 693,398 Q3 2023 Q3 2022 Q3 2023 Q3 2022 Carats recovered (carats) Carats sold (carats) Operating cost per tonne
Slide 11: Q3 2023 Financial Highlights
Q3 2023 Financial Highlights Three months ending September 30, 2023 (All currency figures in U.S. Dollars) Revenue (millions) Adjusted EBITDA(1) (millions) $56.9 $49.9 $21.9 $13.8 Q3 2023 Q3 2022 Q3 2023 Q3 2022 Net income (millions) Operating cash flow before working Operating cash flow per share(1
Slide 12: YTD 2023 Operational Highlights – Karowe Mine
YTD 2023 Operational Highlights – Karowe Mine Nine months ending September 30, 2023 (All currency figures in U.S. Dollars) Ore mined (tonnes) Ore processed (tonnes) 2,823,549 2,145,663 2,079,093 2,093,224 YTD 2023 YTD 2022 YTD 2023 YTD 2022 Carats recovered (carats) Carats sold (carats) Operating co
Slide 13: YTD 2023 Financial Highlights
YTD 2023 Financial Highlights Nine months ending September 30, 2023 (All currency figures in U.S. Dollars) Revenue (millions) Adjusted EBITDA(1) (millions) $74.2 $170.5 $140.8 $52.8 YTD 2023 YTD 2022 YTD 2023 YTD 2022 Net income (millions) Operating cash flow before working Operating cash flow per s
Slide 14: Q3 2023 Sales Channels – Karowe Mine
Q3 2023 Sales Channels – Karowe Mine Sales through HB Antwerp, Clara, and Quarterly Tender • High value Specials (+10.8 carats) were manufactured and sold as polished through the HB Antwerp supply agreement (terminated September 2023). • Diamonds between 1 and 10 carats that meet specific criteria a
Slide 15: 2023 Annual Guidance – Revised in Q3
2023 Annual Guidance – Revised in Q3 (All currency figures in U.S. Dollars) Karowe Diamond Mine Initial – FY 2023 Revised – FY 2023 Diamond revenue1 $200 to $230 $160 to $190 (millions) Diamond sales (carats) 385,000 to 415,000 365,000 to 385,000 Diamonds recovered 395,000 to 425,000 395,000 to 405,
Slide 16: Approach to Sustainability
Approach to Sustainability Focused on transparency, the protection of our people, and stakeholder engagement ✓ No lost time injuries in Q3; ✓ Global Industry Standards ✓ Certified by the Responsible Jewellery the mine has operated for Tailing Management Council (RJC), compliant with the 1,047 days w
Slide 17: Q3 2023 Community Impact Update
Q3 2023 Community Impact Update Projects – Supporting SDGs ✓ Mokubilo and Khwee co-operative farms ✓ Mmadikola Hardware store ✓ Kolonkwaneng Horticulture ✓ Abattoir ✓ Community Sports Complex in Letlhakane Community Engagement ✓ GM’s cycling challenge in Letlhakane, raising funds for the Community L
Slide 18: What Makes Us Excited
What Makes Us Excited The resource never disappoints Karowe’s AK6 kimberlite has consistently produced some of the world’s largest and highest value diamonds and we have only scratched the surface Significant grout covers which affect the UG development are behind us A significant knowledge base has
Slide 19: Contact
Contact Suite 502 1250 Homer St. Vancouver, BC V6B 2Y5 Canada Tel: +1 604 674 0272 Email: info@lucaradiamond.com LucaraDiamond.com | LUC.TSX | LUC.XSTO | LUC.BSE
Slide 20: Appendix
APPENDIX
Slide 21: 2023 Annual Guidance & Nine months ended September 30, 2023 Actuals
2023 Annual Guidance & Nine months ended September 30, 2023 Actuals (All currency figures in U.S. Dollars) Nine months ended Karowe Diamond Mine FY2023 Guidance September 30, 2023 Actuals Diamond revenue1 $160 to $190 million (revised) $140.8 million Diamond sales 365,000 to 385,000 carats (revised)
Slide 22: Material Milled (tonnes)
Total Blended Mine and Mill Feed from Underground 3,500,000 175 3,000,000 150 Material Milled (tonnes) 2,500,000 125 Value / Tonne ($/t) 2,000,000 100 1,500,000 75 1,000,000 50 500,000 25 - 0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 UG-South
Slide 23: Expected Carats Produced
Expected Carats Produced 600,000 500,000 Carats produced 400,000 300,000 200,000 100,000 - 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 North Centre South- EMPKS South - MPKS Life of Mine 23
Slide 24: Karowe Underground Expansion – Post-tax cash flow
Karowe Underground Expansion – Post-tax cash flow Karowe UGP Post-tax cash flow 200 1,400 1,200 150 1,000 Cumulative CF US$M 800 Annual CF US$M 100 600 400 50 200 0 0 (200) (50) (400) Annual After-Tax Cash Flow Cumulative After-Tax Cash Flow The after-tax cash flow model has been updated to estimate
Slide 25: Large Diamond Recovery and Contribution of South Lobe and EM/PK(S)
Large Diamond Recovery and Contribution of South Lobe and EM/PK(S) Production 366Kct 433Kct 381Kct 369Kct 335Kct 180Kct ~480Kct 100% 75 90% 65 Proportion Carats by Source 80% 55 70% # Diamonds >100 ct 45 60% 50% 35 40% 25 30% 15 20% 5 10% 0% -5 2018 2019 2020 2021 2022 HY 2023 UG Y1-Y3 Karowe Diamon
Slide 26: Underground – Large Diamond Potential
Underground – Large Diamond Potential • Size distribution model for +10.8 carat diamonds indicates that 30% of the +10.8ct production are expected to be in excess of 100 carat stones, based on historical production • Model for remaining Life of Mine indicates Karowe will produce over 450kct of Speci