LUCARA ANNOUNCES YEAR END 2025 RESULTS

by | March 4, 2026 8:26 am | US Markets

VANCOUVER, BC, March 3, 2026 /CNW/ – (TSX:LUC) (BSE: LUC) (Nasdaq FNGM: LUC) PDF Version

Lucara Diamond Corp. (“Lucara” or the “Company”) today reports its results for the quarter ended December 31, 2025. All amounts are in U.S. dollars unless otherwise noted. References to “C$” are to Canadian dollars. 

FISCAL 2025 HIGHLIGHTS

  • A total of 353,302 carats were sold (2024: 399,215 carats), generating $159.7 million in revenue (2024: $203.9 million). Revenue for the year includes the sale of the Seriti, a 1,094 carat diamond sold to HB Trading BV (“HB”) for an initial polished value of $12.0 million. A further $7.9 million in top-up revenue was earned during 2025 following the sale of polished outcomes from the Seriti. Revenue for the comparative year includes the sale of the Sethunya, a 549 carat Type IIA white gem quality diamond and the Eva Star, a 1,080 carat Type IIA diamond. The Company sold the Sethunya and Eva Star for a combined sum of $54.0 million and in Q4 2024 recognized $44.0 million in revenue net of fees, excluding royalties.
  • The production and ventilation shafts both reached final depth in 2025 marking a key milestone toward completion of the Karowe Underground Project (“UGP”). Significant process was made in lateral development connecting the two shafts across multiple levels. The UGP achieved over 2,000 days without a lost-time injury.
  • On December 1, 2025, the Company awarded a lateral development contract to Group R Mining and Exploration Botswana (Pty) Ltd. for the execution of all underground lateral development from the production and ventilation shafts to the ore body, including construction of the extraction level, underground crushing chamber, fine ore bins, and pump stations with associated infrastructures required to advance to the kimberlite.
  • The recovery of 772 Specials1 (2024: 807 Specials) equated to 7.1% (2024: 7.6%) by weight of the total carats recovered from direct ore feed in 2025. During 2025, the Company recovered 31 stones over 100 carats, including three stones that exceeded 1,000 carats. Significant recoveries in 2025 included a 1,476 carat non-gem diamond, a 2,036 carat near-gem diamond, a 1,0152 carat non-gem diamond and a 37.42 carat pink Type IIa diamond.
  • A total of 89,596 carats were recovered in Q4 2025; 86,110 carats were from direct open pit ore feed and stockpiles, at a recovered grade of 12.2 carats per hundred tonnes (“cpht”), and an additional 3,486 carats were recovered from processing historical recovery tailings.
  • All key operational and financial metrics set out in the Company’s 2025 Revised Guidance were achieved.
  • A total of 1.9 million tonnes (“Mt”) (2024: 3.0 Mt) of ore was mined with 2.8 Mt of ore processed (2024: 2.9 Mt).
  • Financial highlights for 2025 included:
    • Operating margins of 52% were achieved compared to 61% in 2024. The 9% decrease reflects a 22% decrease in revenue partially offset by a 3% decrease in operating expenses.
    • Operating cost per tonne processed was $27.15 per tonne, a decrease of 3% compared to the 2024 operating cost of $27.89 per tonne. The continued impact of inflationary pressures, particularly labour, has been well managed by the operation. Operating cost per tonne processed is a non-IFRS measure.
  • Cash position and liquidity as at December 31, 2025:
    • Cash balance of $31.9 million.
    • $190.0 million has been fully drawn from the project finance facility (“Project Facility”) for the UGP, along with $30.0 million fully drawn from the working capital facility (“WCF” and together with the Project Facility, the “Facilities”).
    • Working capital (current assets less current liabilities) of $33.6 million.
  • The Company drew $28.0 million from the Cost Overrun Reserve Account (“CORA”) in exchange for its largest shareholder, Nemesia S.à.r.l. (“Nemesia”), agreeing to amend the terms of its limited shareholder standby undertaking through to UGP completion.
  • The Company drew $28.0 million from the $63.0 million funding support provided by Nemesia and issued an unsecured debenture (the “Debenture”) in connection with the drawdown. The Debenture matures on June 30, 2031.

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1

Specials are defined as stones above 10.8 carats.

2

The carats reflect the final cleaned weight of the rough stone. The stone was previously reported at 1,019.85 carats.

SUBSEQUENT TO FISCAL 2025 HIGHLIGHTS

  • On January 29, 2026, the Company closed a non-brokered private placement for total gross proceeds of C$165.0 million (the “January 2026 equity financing”). The Company issued an aggregate of 1,031,250,000 common shares at a price of C$0.16 per common share.
  • On January 30, 2026, the Company filed an updated Feasibility Study (the “Updated Feasibility Study”) prepared in accordance with National Instrument 43-101 – Standards of disclosure for Mineral Properties which provided an update on the progress and estimate for the total costs of the UGP. The revised forecasted costs at completion are $779.2 million, an increase of 14% from the prior estimate in July 2023, of which $469.4 million has been incurred as at December 31, 2025.
  • On March 3, 2026, the Company and the Lenders (as defined below) entered into a waiver agreement (the “Subsequent Waiver Agreement”). The Subsequent Waiver Agreement approved a reduction of the required CORA balance from $33.7 million to $21.2 million.

William Lamb, President & CEO commented: “Our 2025 performance reflects both the resilience of our operations and the unique value proposition of Karowe. We continued to achieve strong operating margins of 52% and met all key metrics set out in our 2025 Revised Guidance.

Operationally, 2025 was a milestone year for the Karowe Underground Project. Both the production and ventilation shafts reached final depth, lateral development advanced across multiple levels, and the project surpassed 2,000 days without a lost-time injury, an achievement that speaks to the strength of our safety culture. The award of the lateral development contract to Group R Mining and Exploration Botswana marks the transition to the next critical phase, advancing infrastructure toward the ore body and positioning us for long-term underground production.

Karowe’s ability to consistently recover large, high-value diamonds remains unmatched. In 2025, Specials accounted for 7.1% by weight of total recovered carats from direct ore feed, with 31 stones over 100 carats recovered, including three exceeding 1,000 carats and a rare 37.42 carat pink Type IIa diamond. These recoveries underscore the exceptional quality of the resource as we transition from open pit to underground mining.

We strengthened our capital structure with the successful C$165 million equity financing completed in January 2026 The filing of our Updated Feasibility Study confirms a clear path to completion of the UGP, with $469.4 million already invested and a disciplined plan to deliver the project. Together, these achievements reinforce our confidence in Karowe’s long-term potential and our commitment to creating sustainable value for our shareholders and stakeholders alike.”

GOING CONCERN

As of the date of this news release, the Company’s Facilities to fund the UGP are fully drawn. The Company did not comply with the covenants under the Facilities requiring a technically signed off financial model by June 30, 2025 (“Financial Model Covenant”), the execution of a lateral development contract by July 31, 2025 (“Lateral Development Contract Covenant”), the requirement to provide a cost to complete certificate by August 31, 2025 (“Cost to Complete Covenant”), and the requirement to fully pay down the WCF for five successive business days at least once every 12 months (the “Clean Down” and collectively, the “Covenants”). On December 30, 2025, the Company and the lenders, a syndicate of six mandated lead arrangers (the “Lenders”) entered into an agreement to waive all Covenant breaches and events of default (the “Waiver Agreement”). The Waiver Agreement provided extensions to the following covenants: the Financial Model Covenant and the Lateral Development Contract Covenant to February 28, 2026, the Cost to Complete Covenant to March 31, 2026, and the Clean Down to June 30, 2026. As of the date of this news release, the Company is in full compliance with its Facilities, including the Financial Model Covenant and the Lateral Development Contract Covenant, with no outstanding Covenant breaches.

On March 3, 2026, the Company and the Lenders entered into a waiver agreement (the “Subsequent Wavier Agreement”). The Subsequent Waiver Agreement extends the Financial Model Covenant and Cost to Complete Covenant to July 15, 2026.

Management has assessed the Company’s ability to continue as a going concern for at least twelve months from December 31, 2025. Based on this assessment, the Company estimates that its working capital as at December 31, 2025, cash flow from operations, the January 2026 equity financing, and other committed sources of liquidity will not be sufficient to meet the revised forecasted costs at completion for the UGP of $779.2 million of which $469.4 million of costs have been incurred. Given that committed sources of liquidity are not sufficient to meet the revised forecast and remaining cost to complete, the Company is not expected to comply with the Cost to Complete Covenant by July 15, 2026, unless additional financing is obtained or the Lenders grant a waiver or extension for the Cost to Complete Covenant. The Company is continuing to evaluate additional financing options to support completion of the UGP. While the Company has previously been successful in raising financing, future fundraising efforts may not succeed or may fall short of the required amounts. These conditions cast significant doubt on the Company’s ability to continue as a going concern.

The Annual Financial Statements have been prepared on a going concern basis which assumes the Company will continue operations, realize assets, and settle its liabilities as they become due. The Company’s Annual Financial Statements do not include adjustments that may be necessary if the Company is unable to continue normal operations; such adjustments could be material and affect asset recoverability, liability classification, expenses, and comprehensive income.

DIAMOND MARKET

The long-term outlook for natural diamond prices remains cautious amid ongoing structural changes in the market. Lab-grown diamond prices have continued to decline through 2025 with production outweighing demand. Global natural diamond production is forecasted to decrease, following significant production guidance cuts by the major diamond producers.

In the near term, premium-grade large natural diamonds are showing signs of potential price stability with De Beers recently announcing a positive price increase in rough diamonds above 5 carats in size, supported by limited global supply growth and a paucity of rough diamonds in these and larger sizes. However, mid-range and lower-grade stones remain under pricing pressure due to high inventories, cautious consumer sentiment, and the rise in the purchasing of lab-grown diamonds.

KAROWE UNDERGROUND PROJECT UPDATE

The UGP is designed to access the highest value portion of the Karowe orebody, with initial underground carat production predominantly from the EM/PK(S)3 unit. The UGP is expected to extend the mine life to 2038.

On January 30, 2026, the Company announced an update to the UGP schedule and budget (link to news release). Production from the UGP is anticipated in H1 2028 with a revised total cost at completion of $779.2 million (including contingency). As at December 31, 2025, capital expenditures of $469.4 million had been incurred. Committed, not yet incurred, UGP costs are $82.3 million as at December 31, 2025. The Updated Feasibility Study incorporates construction progress, revisions to exchange rates, inclusion of Legacy stone4 values, and costs incurred to date, and updates to hydrogeological and geomechanical models, mine design, method and scheduling. From H1 2026 to H1 2028, the Company will process a combination of ore from open pit operations and stockpiled materials.

The UGP has progressed well, highlighted by reaching the bottom of the 776 metres (“m”) production shaft and the 729 m ventilation shaft in 2025. The UGP has achieved 2,159 lost-time injury free days. During Q4 2025, the UGP achieved a twelve-month rolling Total Recordable Injury Frequency Rate (“TRIFR”) of 0.67. The UGP to date TRIFR up to December 31, 2025 was 0.56.

A total of $75.8 million5 was spent on the UGP in 2025 with $20.3 million5 in Q4 2025. Expenditures were primarily directed toward advancing shaft sinking, developing the 245-level6, 285-level, 310-level and 335-level to connect the shafts and initiating lateral development.

In Q4 2025, the Company executed a lateral development contract covering all underground lateral development from the production and ventilation shafts to the ore body. The scope includes construction of the extraction level, underground crushing chamber, fine ore bins, pump stations with associated vertical dams, drilling horizons, workshop facilities, and all connecting infrastructure required to advance towards the kimberlite.

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