LUCARA ANNOUNCES STRONG Q2 2022 FINANCIAL AND OPERATIONAL RESULTS AS UNDERGROUND SHAFT SINKING COMMENCES

TSX: LUC) (BSE: LUC) (Nasdaq Stockholm: LUC)

Lucara Diamond Corp. ("Lucara" or the "Company") today reports its results for the quarter ended June 30, 2022 . Please view PDF version

Q2 2022 HIGHLIGHTS:

  • Revenue for the three months and six months ended June 30, 2022 totalled $52.3 million and $120.5 million , respectively.
  • Strong rough and polished diamond market fundamentals continue, despite growing global economic uncertainties.
  • Revenue from sales transacted on Clara during the three months ended June 30, 2022 totalled $9.4 million , a 13% increase from the $8.3 million in revenue earned in the comparative quarter.
  • A third-party producer commenced a series of trial sales on Clara in Q2 of 2022, which are continuing into Q3 of 2022.
  • Production metrics remained in line with 2022 guidance, with 1.1 million tonnes of ore and 0.4 million tonnes of waste mined, and 0.7 million tonnes of ore processed during the three months ended June 30, 2022 .
  • A strong U.S. Dollar helped to mitigate increases in input costs, resulting in an operating cash cost of $28.78 per tonne of ore processed (1) .
  • A total project investment of $29.1 million into the Karowe UGP during the current quarter focused on the transition to main sink activities and construction of the upgraded transmission line and related substations.

Eira Thomas, President & CEO commented: "In Q2, Lucara celebrated 10 years of continuous operations at its 100% owned Karowe Diamond Mine and delivered production on plan in combination with healthy diamond sales, reflecting stable polished diamond demand and a continued positive outlook for diamond prices longer term.  Third party volumes on Clara also continued to grow during the quarter, with Karowe goods reliably supplemented in each completed sale. Momentum on the underground expansion continues to ramp up as we began the transition towards the main shaft sinking phase; Lucara maintains access to ample liquidity to support of its growth plans."

REVIEW FOR THE QUARTER ENDED JUNE 30, 2022

  • Operational highlights from the Karowe Mine for the three months ended June 30, 2022 included:
    • Mined 1.1 million tonnes (Q2 2021: 0.9) and 0.4 million tonnes (Q2 2021: 0.8) of ore and waste, respectively.
    • Processed 0.7 million tonnes of ore (Q2 2021: 0.7) and recovered 86,317 carats (Q2 2021: 101,330 carats), achieving a recovered grade of 12.0 carats per hundred tonnes (Q2 2021: 13.9 cpht).
    • A total of five diamonds greater than 100 carats were recovered during the quarter.
    • The year-to-date Total Recordable Injury Frequency Rate ("TRIFR") of 0.09 (Q2 2021: zero) at the end of Q2 2022 reflects one medical treatment case reported during the first quarter of 2022.
  • Financial highlights for the three months ended June 30, 2022 included:
    • Revenues from the sale of 66,167 carats recovered from the Karowe Mine were $50.0 million (Q2 2021: $45.9 million from the sale of 68,806 carats from Karowe). The sales agreement with HB Trading BV ("HB") accounted for 65% (Q2 2021: 67%) of total Karowe revenue recognized in the quarter.
    • Operating cash costs of $28.78 per tonne processed(1) (Q2 2021: $27.51 per tonne processed) reflect the impact of higher input costs, partially offset by a comparatively stronger U.S. Dollar.
    • Adjusted EBITDA(1) of $24.4 million increased by 10% from $22.2 million for the same period in 2021, attributed primarily to higher revenues.
    • Net income for the quarter increased to $12.5 million ( $0.03 basic earnings per share) from $6.0 million ( $0.02 basic earnings per share) in Q2 2021.
  • Cash position and liquidity:
    • As at June 30, 2022 , the Company had cash and cash equivalents of $40.8 million .
    • The Company drew an additional $20.0 million from the $170.0 million project loan facility for a total drawn amount of $65.0 million .
    • The outstanding balance on the working capital facility was reduced to zero during the quarter and the full $50.0 million facility was unutilized as at June 30, 2022 .

(1) See "Non-IFRS Financial Performance Measures"

DIAMOND SALES

Diamond sales in Q2 2022 continued through HB under the sales agreement for those gem and near-gem diamonds greater than 10.8 carats which are to be manufactured and sold as polished. Other diamonds continued to be sold through a combination of the Clara platform and regular tenders.

The Company recognized total revenues of $52.3 million in Q2 2022. This included $50.0 million from the sale of 66,167 carats from Karowe, top-up payments of $13.1 million as well as $2.3 million from the sale of third-party goods on the Clara platform. In the comparative quarter, the Company achieved revenues of $46.3 million which included $45.9 million from the sale of 68,806 Karats from Karowe, top-up payments of $7.9 million as well as $0.4 million in revenue from third party goods sold through the Clara platform.

HB SALES AGREEMENT FOR +10.8 CARAT DIAMOND PRODUCTION FROM KAROWE

Karowe's large, high value diamonds have historically accounted for approximately 60% to 70% of Lucara's annual revenues.  In 2020, Lucara announced a partnership agreement with HB, entering into a definitive sales agreement for diamonds recovered that exceed +10.8 carats from the Company's 100% owned Karowe Diamond mine in Botswana . This agreement was subsequently amended and extended to December 31 , 2022.  The mechanisms of the agreement result in complete transparency within the value chain and create important alignment between the producer and the manufacturer for the first time.

Under the amended sales agreement, +10.8 carat gem and near gem diamonds from the Karowe Mine of qualities that can directly enter the manufacturing stream are being sold to HB at prices based on the estimated polished outcome of each diamond. The estimated polished value is determined through state-of-the-art scanning and planning technology, with an adjusted amount payable on actual achieved polished sales, less a fee and the cost of manufacturing. Following the extension of the HB Agreement in 2021, all +10.8 carat non-gem quality diamonds and all diamonds less than 10.8 carats in weight which did not meet the criteria for sale on Clara are being sold as rough through the quarterly tender. In the agreement extension, payment terms were amended to better reflect the timing of mine production and the manufacturing process. This unique pricing mechanism delivers regular cash flow for this important segment of our production profile.

(1) See "Non-IFRS Financial Performance Measures"

For the three months ended June 30, 2022 , the Company recorded revenue of $32.4 million from the HB agreement (inclusive of top-up payments of $13.1 million ), as compared to revenue of $30.7 million in Q2 2021 (inclusive of top-up payments of $7.9 million ). The increase in revenue in Q2 2022 is attributed to higher prices achieved, despite lower overall sale volumes delivered to HB during the current quarter. Diamond market fundamentals continued to support healthy prices as steady demand and some inventory shortages were reported. Natural variability in the quality profile of the +10.8ct production in any production period or fiscal quarter results in fluctuations in recorded revenue and associated top ups between periods.  This is expected and reflects a combination of current diamond market prices as well as variability in the quality of Karowe's production profile in any given period.

As a result of the sales agreement with HB, the Company also participated in polished diamond price increases during Q2 2022 as rough diamonds sold to HB in previous quarters were polished and sold.  In Q2 2022, top-up payments of $13.1 million (Q2 2021: $7.9 million ) were included in revenue for the quarter. At June 30, 2022 a number of higher value and more technically complex stones that take longer to manufacture had not fully completed the manufacturing and sales process. These stones were delivered to HB in 2021 and the first six months of 2022.  As these stones finish the manufacturing process and are sold, the Company's may record additional revenue in the form of "top-up" payments from these sales.

CLARA SALES PLATFORM

Clara, Lucara's 100% owned proprietary, secure, web-based digital sales platform, continues to gain scale and interest.  Interest in Clara continues to grow as the benefits of purchasing rough diamonds in an innovative way become evident.  In Q2 2022, five sales (Q2 2021: six sales) took place with a total sales volume transacted of $9.4 million , a 13% increase from the $8.3 million transacted in Q2 2021, continuing the strong price trends observed on Clara during Q1 2022.  The number of buyers on the platform remained stable during the quarter with the Company maintaining a waiting list to manage supply and demand.

While most of the stones transacted through the platform are supplied from the Karowe Mine, secondary market stones continued to be offered for sale through the platform with good results.  Additional supply is required to meet existing demand and drive the platform's growth and the Company launched a series of trial sales on the Clara platform with a third-party producer in Q2 2022.  The Company intends to continue to seek additional supply in 2022, both from third-party producers and the secondary market.

KAROWE UNDERGROUND EXPANSION UPDATE

The Karowe UGP is expected to extend the mine life to at least 2040, with underground carat production predominantly from the highest value EM/PK(S) unit and is forecast to contribute approximately $4 billion in additional revenues, using conservative diamond prices.  The estimated capital cost for the Karowe UGP has increased from $534 million (including contingency) to $547 million to reflect expected pricing changes following execution of the main sink contract.  Mine ramp up is expected in Q1 2026 with full production from the Karowe UGP expected in H2 2026.  The Company is using a combination of cash flow from operations and project debt for the investment in the Karowe UGP, which is fully financed.

During the three months ended June 30, 2022 , a total of $29.1 million was spent on the Karowe UGP development, primarily in relation to ongoing construction activities and procurement of long lead items, including:

  • Pre-sink activities for both the production and ventilation shafts were completed, including placement and erection of headgear for the production shaft.
  • The main sink contract for the production and ventilation shafts was executed and main sinking of the ventilation shaft commenced. The transition from the pre-sink to the main sinking phase has been slower than anticipated however, opportunities have been identified to decrease main sink cycle times and reduce the impact to the schedule.
  • The production shaft stage winder was installed and roped-up.
  • Procurement of shaft station underground mobile equipment and the mine bulk air cooler was initiated.
  • Letlhakane and Karowe power substation construction continued. The transmission line towers were erected in preparation for the stringing of the transmission lines.

Activities for the Karowe UGP in the upcoming quarters of 2022 are expected to include the following:

  • Commencement of main sinking for the production shaft.
  • Awarding of bulk air cooler tender and continued procurement of underground equipment.
  • Continuation of detailed design and engineering of the underground mine infrastructure and layout.
  • Commissioning of the 29 km 132kV bulk power supply powerline by the end of the year.

DIAMOND MARKET

The diamond market continued its strong performance during the second quarter of 2022 with minor price corrections observed. Solid market fundamentals supported diamond prices despite growing concerns of a global economic slowdown as high levels of reported inflation persisted and governments respond with increasingly forceful measures in attempts to reduce it to sustainable levels.

A cautious economic outlook combined with the uncertainty caused by geopolitical events, including the conflict in Ukraine and continuing implications of the COVID-19 pandemic (specifically in China where the demand for diamonds has not yet recovered) remain a risk to diamond pricing trends in the short term but the longer-term price outlook remains positive.

The benefits of the committed sales agreement with HB continued to be realized during the second quarter of 2022 as the Company participated in the upside to manufacturing polished diamonds for goods delivered in previous quarters. The integrated approach, using state of the art scanning and planning technology has further enhanced the final achieved polished outcome for very large (+50 carat polished) and high value diamonds, a critical production segment for the Company.

FINANCIAL HIGHLIGHTS











Three months ended
June 30,


Six months ended
June 30,


In millions of U.S. dollars, except carats or otherwise noted


2022

2021


2022

2021










Revenues


52.3

46.3


120.5

99.4


Operating expenses


(17.0)

(15.1)


(34.9)

(34.8)


Net income for the period


12.5

6.0


31.5

9.4










Earnings per share (basic)


0.03

0.02


0.07

0.02


Earnings per share (diluted)


0.03

0.01


0.07

0.02


Operating cash flow per share (1)


0.05

0.05


0.13

0.11










Cash on hand


40.8

13.7


40.8

13.7


Amounts drawn on working capital facility


–

50.0


–

50.0


Amounts drawn on project finance facility


65.0

–


65.0

–










Karowe Revenue


50.0

45.9


117.2

98.9


Average price per carat sold ($/carat) (2)


557

552


631

510


Carats sold


66,167

68,806


146,462

160,540























(1)

Operating cash flow per share before working capital adjustments is a non-IFRS measure. See "Use of Non-IFRS Performance Measures" below.

(2)

The Company's revenue is primarily generated from the sale of Karowe diamonds. The average price per carat sold presented in this table relates exclusively to the sale of Karowe diamonds and excludes top-up payments received during the quarter.  Also excluded is the value of diamonds purchased from third parties and sold by the Company through Clara. See Table 2 in the Q2 2022 MD&A for additional information.

QUARTERLY RESULTS OF OPERATIONS – KAROWE MINE, BOTSWANA


UNIT

Q2-22

Q1-22

Q4-21

Q3-21

Q2-21

Sales







Revenues from the sale of Karowe diamonds

US$M

50.0

67.2

56.5

72.5

45.9

Karowe carats sold

Carats

66,167

80,295

102,791

117,162

68,806

Average price per carat - excluding top-ups (1)

US$

557

690

436

596

552

Production







Tonnes mined (ore)

Tonnes

1,091,192

811,947

610,072

1,190,856

900,660

Tonnes mined (waste)

Tonnes

357,764

482,104

276,263

696,907

787,227

Tonnes processed

Tonnes

719,207

666,488

705,877

738,986

726,379

Average grade processed (2)

cpht (*)

12.0

12.6

12.8

13.2

13.9

Carats recovered

Carats

86,317

83,917

90,634

97,412

101,330

Costs







Operating expense per Karowe carat sold (3)

US$

221

212

200

193

211

Margin (mining operations) per Karowe carat sold

US$

336

478

236

403

341

Operating cost per tonne of ore processed (4)

US$

28.78

27.80

29.74

29.73

27.51








Capital Expenditures







Sustaining capital expenditures

US$M

4.1

0.8

9.1

3.4

2.4

Underground expansion project (5)

US$M

29.1

31.1

21.8

32.0

22.6

(*) carats per hundred tonnes

(1)

Previously presented as $418 (Q4 2021), $588 (Q3 2021) and $522 (Q2 2021) per carat, respectively.

(2)

Average grade processed is from direct milling carats and excludes carats recovered from re-processing historic recovery tailings from previous milling.

(3)

Previously presented as $224 (Q1 2022), $217 (Q4 2021), $198 (Q3 2021) and $219 (Q2 2021) per carat, respectively.

(4)

Operating cost per tonne of ore processed is a non-IFRS measure.

(5)

Excludes qualifying borrowing cost capitalized in each quarter since Q4 2021.

2022 OUTLOOK

This section of the press release provides management's production and cost estimates for 2022.  These are "forward-looking statements" and subject to the cautionary note regarding the risks associated with forward-looking statements. No changes were made to the Company's 2022 Guidance as of Q2 2022.  In February 2022 , based on updated expectations for revenue in 2022, the diamond revenue guidance issued was increased to between $195.0 million and $225.0 million (from $185.0 million to $215.0 million ). Diamond revenue guidance does not include revenue related to the sale of exceptional stones (an individual rough diamond which sells for more than $10 million ), or the Sethunya.

Karowe Diamond Mine

Full Year – 2022

In millions of U.S. dollars unless otherwise noted


Diamond revenue (millions) (revised as of February 2022)

$195 to $225

Diamond sales (thousands of carats)

300 to 340

Diamonds recovered (thousands of carats)

300 to 340

Ore tonnes mined (millions)

3.1 to 3.5

Waste tonnes mined (millions)

1.5 to 2.1

Ore tonnes processed (millions)

2.6 to 2.8

Total operating cash costs (1) including waste mined (2) (per tonne processed)

$29.50 to $33.50

Botswana general & administrative expenses including marketing costs (per tonne
processed)

$3.50 to $4.00

Tax rate (3)

0 %

Average exchange rate – USD/Pula

11.0

(1)

Operating cash costs are a non-IFRS measure.  See "Non-IFRS Financial Performance Measures".

(2)

Includes ore and waste mined cash costs of $5.75 to $6.25 (per tonne mined) and processing cash costs of $12.00 to $13.00 (per tonne processed).

(3)

The Company is subject to a variable tax rate in Botswana based on a profit and revenue ratio which increases as profit as a percentage of revenue increases. The lowest variable tax rate is 22% while the highest variable tax rate is 55% (only if taxable income were equal to revenue).  Capital expenditures are deductible when incurred. With planned capital expenditures of up to $110 million for the UGP, a tax rate of 0% is forecast for 2022. Should capital expenditures vary from plan, the Company could be subject to current tax.

In 2022, the Company's revenue forecast assumes that 100% of the carats recovered will come from the higher value M/PK(S) and EM/PK(S) units within the South Lobe in accordance with the mine plan.

The assumptions for carats recovered and sold are consistent with achieved performance in recent years.  The number of tonnes processed is also consistent with recent achievements, noting that actual tonnes processed in 2021 was about 6% higher than 2020 due to improving plant reliability because of the success of the preventative maintenance plan that has been implemented.

Waste tonnes that were deferred in 2021 as other mining areas in the open-pit were prioritized are expected to be caught up in between 2022 and 2024.   The estimated processing cost per tonne processed is higher than previous years, reflecting expected inflationary pressure on labour and commodity costs.

In 2022, capital costs for the underground expansion are expected to be up to $110 million and will focus on the commencement of main shaft sinking activities, the commissioning of the bulk power supply 132 kV line and substations and detailed engineering for the underground development. Sustaining capital and project expenditures are expected to be up to $17 million with a focus on completion of a community sports facility, dewatering activities and an expansion of the tailings storage facility.

Lucara Botswana's progressive tax rate computation allows for the immediate deduction of operating costs, including capital expenditures, in the year in which they are incurred.  Based on the updated 2022 revenue guidance of $195 million to $225 million and assuming the underground development expenditures are incurred, the expected tax rate will be 0% for 2022.

CONFERENCE CALL

CONFERENCE CALL
The Company will host a conference call and webcast to discuss the results on Thursday, August 11, 2022 at 7:00 a.m. Pacific, 10:00 a.m. Eastern, 3:00 p.m. UK, 4:00 p.m. CET .

CONFERENCE CALL
Please call in 10 minutes before the conference call starts and stay on the line (an operator will be available to assist you).

Conference ID:
7733206 / Lucara Diamond

Dial-In Numbers:

Toll-Free Participant Dial-In North America

(+1) 800 289 0720

UK Toll free

0 800 279 6877

Local

(+1) 647 484 0258

Webcast:
To view the live webcast presentation, please log on using this direct link: https://app.webinar.net/OnWVxNl9gv0

The presentation slideshow will also be available in PDF format for download from the Lucara website ( Link to presentation ).

Conference Replay:

A replay of the conference call will be available two hours after the completion of the call until August 18, 2022 .

Replay number (Toll Free North America)

(+1) 888 203 1112

Replay number (Local)

(+1) 647 436 0148

The passcode for the replay is: 7733206 #.

On behalf of the Board,

Eira Thomas
President and Chief Executive Officer

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ABOUT LUCARA

Lucara is a leading independent producer of large exceptional quality Type IIa diamonds from its 100% owned Karowe Diamond Mine in Botswana . The Karowe Mine has been in production since 2012 and is the focus of the Company's operations and development activities. Clara Diamond Solutions Limited Partnership ("Clara"), a wholly-owned subsidiary of Lucara, has developed a secure, digital sales platform that uses proprietary analytics together with cloud and blockchain technologies to modernize the existing diamond supply chain, driving efficiencies, unlocking value and ensuring diamond provenance from mine to finger.  Lucara has an experienced board and management team with extensive diamond development and operations expertise.  Lucara and its subsidiaries operate transparently and in accordance with international best practices in the areas of sustainability, health and safety, environment, and community relations.  Lucara has adopted the IFC Performance Standards and the World Bank Group's Environmental, Health and Safety Guidelines for Mining (2007).  Accordingly, the development of the Karowe underground expansion project ("UGP") adheres to the Equator Principles. Lucara is committed to upholding high standards while striving to deliver long-term economic benefits to Botswana and the communities in which the Company operates.

The information is information that Lucara is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. This information was submitted for publication, through the agency of the contact person set out above, on August 10, 2022 at 3:30pm Pacific Time .

NON-IFRS FINANCIAL PERFORMANCE MEASURES

This news release refers to certain financial measures, such as adjusted EBITDA, adjusted operating earnings, operating cash flow per share, operating margin per carat sold and operating cost per tonne of ore processed, which are not measures recognized under IFRS and do not have a standardized meaning prescribed by IFRS. These measures may differ from those made by other corporations and accordingly may not be comparable to such measures as reported by other corporations. These measures have been derived from the Company's financial statements, and applied on a consistent basis, because the Company believes they are of assistance in the understanding of the results of operations and financial position. Please refer to the Company's MD&A for the three months ended June 30, 2022 for an explanation of non-IFRS measures used.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain of the statements made and contained herein and elsewhere constitute forward-looking statements as defined in applicable securities laws. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "expects", "anticipates", "believes", "intends", "estimates", "potential", "possible" and similar expressions, or statements that events, conditions or results "will", "may", "could" or "should" occur or be achieved.

Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made, and they are subject to a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievement expressed or implied by such forward-looking statements. The Company believes that expectations reflected in this forward-looking information are reasonable, but no assurance can be given that these expectations will prove to be accurate and such forward-looking information included herein should not be unduly relied upon.

In particular, forward-looking information and forward-looking statements in this news release may include, but are not limited to, information or statements with respect to the equity and project debt financings, the intended use of proceeds, the Company's ability to comply with the terms of the Facilities which are required to construct the Karowe UGP, that expected cash flow from operations, combined with external financing will be sufficient to complete construction of the Karowe UGP, that the estimated timelines to achieve mine ramp up and full production from the Karowe UGP can be achieved, the economic potential of a mineralized area, the size and tonnage of a mineralized area, anticipated sample grades or bulk sample diamond content, future production activity, the future price and demand for diamonds, future forecasts of revenue and variable consideration in determining revenue, estimation of mineral resources, exploration and development plans, cost and timing of the development of deposits and estimated future production, permitting time lines, currency exchange rates, success of exploration, requirements for and availability of additional capital, capital expenditures, operating costs, timing of completion of technical reports and studies, tax rates, timing of drill programs, government regulation of operations, environmental risks and ability to comply with all environmental regulations, reclamation expenses, title matters including disputes or claims, limitations on insurance coverage, negotiations and agreements among the Company and the Botswana Mine Workers Union, the completion of transactions and timing and possible outcome of pending litigation, the profitability of Clara and the Clara Platform, and the scaling of the digital platform for the sale of rough diamonds owned by Clara, the benefits to the Company of diamond supply agreements with HB and the ability to generate better prices from the sale of the Company's +10.8 carat production as a polished stone.

There can be no assurance that such forward looking statements will prove to be accurate, as the 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 the heading "COVID-19 Global Pandemic" in the Company's most recent MD&A and under the heading "Risks and Uncertainties" in the Company's most recent Annual Information Form, both available at https://www.sedar.com , as well as changes in general business and economic conditions, the ability to continue as a going concern, changes in interest and foreign currency rates, changes in inflation, the supply and demand for, deliveries of and the level and volatility of prices of rough diamonds, costs of power and diesel, impacts of potential disruptions to supply chains, acts of foreign governments and the outcome of legal proceedings, inaccurate geological and recoverability assumptions (including with respect to the size, grade and recoverability of mineral reserves and resources), and unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalations, unavailability of materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job actions, adverse weather conditions, and unanticipated events relating to health safety and environmental matters).

Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date the statements were made, and the Company does not assume any obligations to update or revise them to reflect new events or circumstances, except as required by law.

LUCARA ANNOUNCES STRONG Q2 2022 FINANCIAL AND OPERATIONAL RESULTS AS UNDERGROUND SHAFT SINKING COMMENCES (CNW Group/Lucara Diamond Corp.)

SOURCE Lucara Diamond Corp.

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STAR DIAMOND CORPORATION COMPLETES ACQUISITION OF RIO TINTO'S 75% INTEREST IN FORT À LA CORNE JOINT VENTURE

TSX: DIAM

Star Diamond Corporation (" Star Diamond ") today announced the completion of its previously announced transaction (the " Transaction ") with Rio Tinto  Exploration Canada Inc. (" RTEC ") whereby RTEC has transferred to Star Diamond all of RTEC's 75% interest in the Fort à la Corne diamond project located in central Saskatchewan (the " Project "). Star Diamond now owns 100% of the Project.

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STAR DIAMOND CORPORATION ANNOUNCES 2023 YEAR END RESULTS

TSX: DIAM

Star Diamond Corporation ("Star Diamond" or the "Company") reports that the audited financial results for the year ended December 31, 2023 will be filed today on SEDAR+ and may be viewed at www.sedarplus.ca once posted.

Star Diamond Logo (CNW Group/Star Diamond Corporation)

Overview
Star Diamond Corporation is a Canadian natural resource company focused on exploring and developing Saskatchewan's diamond resources. Star Diamond currently holds, through a joint venture arrangement with Rio Tinto Exploration Canada Inc. ("RTEC"), a wholly-owned subsidiary of Rio Tinto plc, a 25% interest in certain mineral properties (which include the Star – Orion South Diamond Project, or the "Project") within the Fort à la Corne diamond district of central Saskatchewan, Canada . These properties are in close proximity to established infrastructure, including paved highways and the electrical power grid, which provide significant advantages for future mine development.

The Company also holds a 50% interest in the exploration and evaluation properties and assets of the Buffalo Hills JV located in north-central Alberta, Canada . Canterra Minerals Corporation ("Canterra") holds the remaining 50% interest. Canterra is the operator of the Buffalo Hills JV.

Fort à la Corne mineral properties
On November 28, 2023 , the Company entered into a binding agreement (the "Agreement") with RTEC, providing for the transfer by RTEC to Star Diamond all of RTEC's 75% interest in the Project.

The Agreement provides that, upon closing:

  • RTEC will transfer to Star Diamond all of RTEC's 75% interest in the Project, such that the Project will be 100% owned by Star Diamond ;
  • RTEC will transfer to Star Diamond ownership of the trench cutter drill rig used by RTEC to complete its prior bulk sampling program at the Project;
  • RTEC will transfer to Star Diamond the Bulk Sample Plant located at the Project, including the TOMRA XRT diamond sorting machine that is on-site;
  • Star Diamond will issue to RTEC and/or an affiliate that number of common shares of Star Diamond that results in RTEC and its affiliates owning 19.9% of the then outstanding common shares of Star Diamond (RTEC and its affiliates currently own approximately 2.3% of Star Diamond's outstanding common shares); and
  • RTEC and Star Diamond will enter into an Investor Rights Agreement whereby, among other things, RTEC will be granted certain pre-emptive rights to maintain its 19.9% ownership interest in Star Diamond in connection with future financings undertaken by Star Diamond , and RTEC will agree to certain standstill protections provided that RTEC will have the right to increase its 19.9% ownership position in the event that Star Diamond receives an acquisition proposal.

Upon completion of the transactions that are the subject of the Agreement, Star Diamond will have full control and responsibility for the Project, the existing joint venture agreement between RTEC and Star Diamond will terminate, and Star Diamond will release and indemnify RTEC for liabilities arising from or relating to the Project, all in exchange for a $4 million payment from RTEC to Star Diamond . RTEC has agreed that it will provide on Star Diamond's behalf, for up to five years following closing, letters of credit in the aggregate amount of no more than $9.9 million to secure certain environmental remediation and reclamation obligations related to the Project. Star Diamond will be obliged to repay any amounts drawn on these letters of credit and such repayment obligations will be secured against the Project and its assets.

As of the date of this News Release, the Agreement is expected to close in the near future.

Recent activities relating to the Star - Orion South Diamond Project and Fort à la Corne mineral properties
During the first quarter of 2024, Star Diamond continued to work with RTEC and Saskatchewan Ministry of Environment representatives to ensure an orderly close to the Agreement between Star Diamond and RTEC.

Year End Results
For the year ended December 31, 2023 , the Company recorded a net loss of $2.8 million or $0.01 per share (basic and fully diluted) compared to a net loss of $68.8 million or $0.15 per share in 2022. The decrease in net loss year over year was due primarily to the prior year's impairment charge of $66.3 million combined with the mark-to-market loss on the Wescan investment offset by the elimination of the $0.9 million contingent consideration.

At December 31, 2023 , the Company had $0.6 million (2022 – $2.6 million ) in cash and cash equivalents and a working capital deficit of $(0.3) million (2022 - $2.0 million ). The decrease in working capital was a result of administrative and exploration and evaluation expenditures offset by proceeds received from the December 2023 private placement. Subsequent to December 31, 2023 , the Company closed the second and final tranche of a non-brokered private placement. However, the ability of the Company to continue as a going concern and fund its expenses in an orderly manner will require additional forms of financings.

Selected financial highlights include:

Condensed Consolidated Statements of Financial Position

As at

December 31,

2023

As at

December 31,

2022

Current assets

$    0.6 M

$    2.7 M

Exploration and evaluation, investments and other assets

0.6 M

0.4 M

Current liabilities

0.9 M

0.7 M

Non-current liabilities

0.1 M

0.0 M

Shareholders' equity

0.2 M

2.4 M




Consolidated Statements of Loss

Year Ended
December 31,

2023

Year Ended
December 31,

2022

Expenses

$ 3.0 M

$ 3.0 M

Loss before undernoted items

(3.0)M

(3.0)M

Investment in Wescan Goldfields Inc.

(0.0)M

(0.4)M

Contingent consideration

0.0 M

0.9 M

Impairment charge

0.0 M

(66.3)M

Net loss for the year

(3.0)M

(68.8)M

Net loss per share for the year (basic and diluted)

(0.01)

(0.15)




Condensed Consolidated Statements of Cash Flows

Year Ended
December 31,

2023

Year Ended
December 31,

2022

Cash flows used in operating activities

$  (2.3)M

$  (4.9)M

Cash flows from investing activities

0.0 M

0.6 M

Cash flows from financing activities

0.2 M

5.7 M

Net increase (decrease) in cash

(2.1)M

1.3 M

Cash – beginning of year

2.6 M

1.3 M

Cash – end of year

0.6 M

2.6 M

Outlook
Fort à la Corne mineral properties
Subsequent to the successful close of the Agreement with RTEC, Star Diamond's technical team will focus on the technical investigation and evaluation of the Star – Orion South Diamond Project, with the goal of a future development decision. The initial work aims to prepare a revised Mineral Resource estimate for the Star – Orion South Diamond Project, which will form the foundation of an updated Prefeasibility study(" PFS"). The PFS will enable a Feasibility Study, on which a production decision can be based.

Buffalo Hills mineral properties
Management continues to review the recent results from the diamond valuation and typing analysis. A more detailed update on activities at the Buffalo Hills JV will be provided as it becomes available.

About Star Diamond Corporation
Star Diamond Corporation is a Canadian based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of Star Diamond trade on the Toronto Stock Exchange under the trading symbol "DIAM". Star Diamond currently holds, through a joint venture arrangement with RTEC, a 25% interest in the Project. The Project is located in central Saskatchewan , in close proximity to established infrastructure, including paved highways and the electrical power grid, which provide significant advantages for future mine development. The Company also holds a 50% interest in the exploration and evaluation properties and assets of the Buffalo Hills JV located in north-central Alberta, Canada . Canterra holds the remaining 50% interest and is the operator of the Buffalo Hills JV.

Technical Information
All technical information in this press release has been prepared under the supervision of George Read , Senior Vice President Corporate Development, Professional Geoscientist in the Provinces of Saskatchewan and British Columbia and Mark Shimell , Vice President Exploration, Professional Geoscientist in the Provinces of Saskatchewan and Alberta , who are the Company's "Qualified Persons" under the definition of NI 43-101.

Stay Connected with Us:
Twitter: https://twitter.com/StarDiamondCorp
LinkedIn: https://www.linkedin.com/company/star-diamond-corp
Facebook: https://www.facebook.com/people/Star-Diamond-Corp/100058096376664/
Instagram: https://www.instagram.com/stardiamondcorp/

Caution Regarding Forward-looking Statements

This press release contains "forward-looking statements" and/or "forward-looking information" (collectively, "forward-looking statements") within the meaning of applicable securities legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate" or "believes", or the negative connotation thereof or variations of such words and phrases or state that certain actions, events or results, "may", "could", "would", "will", "might" or "will be taken", "occur" or "be achieved" or the negative connotation thereof. All statements, other than statements of historical fact, are forward-looking statements.

These forward-looking statements are based on Star Diamond's current beliefs as well as assumptions made by and information currently available to Star Diamond and involve inherent risks and uncertainties, both general and specific. Risks exist that forward-looking statements will not be achieved due to a number of factors including, but not limited to, statements regarding Rio Tinto Canada, the Company's ability to obtain financing to further the exploration, evaluation and/or development of exploration and evaluation properties in which the Company holds interest, the economic feasibility of any future development projects, developments in world diamond markets, changes in diamond prices, risks relating to fluctuations in the Canadian dollar and other currencies relative to the US dollar, the impact of changes in the laws and regulations regulating mining exploration, development, closure, judicial or regulatory judgments and legal proceedings, operational and infrastructure risks and the additional risks described in Star Diamond's most recently filed Annual Information Form, and annual and interim MDA.

Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. In addition, forward-looking statements are provided solely for the purpose of providing information about management's current expectations and plans and allowing investors and others to get a better understanding of our operating environment. Accordingly, readers should not place undue reliance on forward-looking statements.

Forward-looking statements in this news release are made as of the date hereof and Star Diamond assumes no obligation to update any forward-looking statements, except as required by applicable laws.

SOURCE Star Diamond Corporation

Cision View original content to download multimedia: http://www.newswire.ca/en/releases/archive/March2024/25/c1142.html

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Mountain Province Diamonds Announces Revised Details for Q4 and Full-Year 2023 Earnings Release and Conference Call

TSX and OTC: MPVD

Mountain Province Diamonds Inc. ("Mountain Province", the "Company") (TSX: MPVD) (OTC: MPVD) today announces revised details for its fourth quarter and full-year 2023 earnings release and conference call. The delay in the issuance of fourth quarter and year-end 2023 results is due to the financial audit process not being completed by the planned date.

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STAR DIAMOND APPOINTS EWAN MASON AS ITS PRESIDENT AND CEO

Star Diamond Corp (TSX: DIAM) ("Star Diamond" or the "Company") is pleased to announce that its Board of Directors has appointed Ewan Mason to the position of President and Chief Executive Officer, effective immediately. Mr. Mason has served as Interim President and Chief Executive Officer since January 1, 2023. Mr. Mason will continue to serve as Chair of the Company's Board.

add logo (CNW Group/Star Diamond Corporation)

"We are pleased to name Ewan Mason as the President and CEO of Star Diamond," said Lisa Riley , Lead director of the Board. "Since he was appointed interim CEO in January 2023, Ewan's leadership has been integral in the successful negotiation process and the coming acquisition of Rio Tinto Exploration Canada Inc.'s 75% interest in the Fort à la Corne ("FALC") diamond district. He also continues to build strong relationships with our employees, shareholders and stakeholders, all while maintaining a focus on shareholder value."

"I am honored to accept the CEO position at Star Diamond," said Ewan Mason, President and CEO of Star Diamond. "I am excited about the prospect of an ongoing collaboration with an exceptional team and the future development of the world class diamond project that is FALC".

About Star Diamond Corporation
Star Diamond is a Canadian-based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of Star Diamond trade on the Toronto Stock Exchange under the trading symbol "DIAM". Star Diamond's most significant asset is its interest in the Fort à la Corne property in central Saskatchewan. These kimberlites are located in close proximity to established infrastructure, including paved highways and the electrical power grid, which provide significant advantages for future mine development.

Stay Connected with Us:
Twitter: https://twitter.com/StarDiamondCorp
LinkedIn: https://www.linkedin.com/company/star-diamond-corp
Facebook: https://www.facebook.com/people/Star-Diamond-Corp/100058096376664/
Instagram: https://www.instagram.com/stardiamondcorp/

Caution Regarding Forward-looking Statements

This press release contains "forward-looking statements" and/or "forward-looking information" (collectively, "forward-looking statements") within the meaning of applicable securities legislation. All statements, other than statements of historical fact, are forward-looking statements. The use of any of the words "anticipate", "plan", "aim", "target", "contemplate", "continue", "estimate", "expect", "intend", "propose", "might", "may", "will", "shall", "project", "should", "could", "would", "believe", "predict", "forecast", "pursue", "potential", "possible", "capable" and similar expressions are intended to identify "forward-looking statements. Forward-looking statements in this press release include, but are not limited to, expectations regarding the timing for transfer of the Permit to Operate and completion of the transactions that are the subject of the Agreement.

These forward-looking statements are based on Star Diamond's current beliefs as well as assumptions made by and information currently available to it and involve inherent risks and uncertainties, both general and specific. Risks exist that forward-looking statements will not be achieved due to a number of factors including, but not limited to, the MoE's approval processes and the impact of changes in the laws and regulations regulating mining exploration, development, closure, judicial or regulatory judgments and legal proceedings and the additional risks described in Star Diamond's most recently filed Annual Information Form, annual and interim MD&A.

Although management of Star Diamond considers the assumptions contained in forward-looking statements to be reasonable based on information currently available to Star Diamond, those assumptions may prove to be incorrect. When making decisions with respect to Star Diamond, investors and others should not place undue reliance on these statements and should carefully consider the foregoing factors and other uncertainties and potential events.

Star Diamond does not undertake any obligation to release publicly revisions to any forward-looking statement to reflect events or circumstances after the date of this release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued forward-looking statement constitutes a reaffirmation of that statement. Continued reliance on forward-looking statements is at investors' own risk.

SOURCE Star Diamond Corporation

Cision View original content to download multimedia: http://www.newswire.ca/en/releases/archive/March2024/01/c3453.html

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STAR - ORION SOUTH DIAMOND PROJECT

KIMBERLITE CARBON CAPTURE: WORKING TOWARDS A CARBON NEGATIVE DIAMOND MINE

TSX: DIAM

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Mountain Province Diamonds Announces Guidance for 2024, Details of Fourth Quarter and Full-Year 2023 Earnings Release and Conference Call

TSX: MPVD

Mountain Province Diamonds Inc. ("Mountain Province", the "Company") (TSX: MPVD) wishes to provide guidance for 2024, as well as details for its fourth quarter and full-year 2023 earnings release and conference call. All figures are expressed in Canadian dollars unless otherwise noted.

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