Lucara Diamond (LUC.TO) has announced the results of its first exceptional stone tender for 2014 wherein the company sold 20 diamonds totaling almost 1,200 carats. This generated a gross revenue of $50.5M or approximately $42,000 per carat with an exceptionally high $75,000 per carat for a 167 carat diamond. Another 107,500 carats were sold for $33.6M bringing the total revenue for the year to $84M.
By reaching a revenue of $84M, the company is already halfway its official guidance for 2014 wherein it expects to produce approximately 400,000 carats for a total revenue of $150-160M. Even though Lucara Diamond expects to spend roughly $50M in capital expenditures (which should drop significantly from next year on), we expect the company to be free cash flow positive this year.
Disclosure: The author holds no position in Lucara Diamonds. Please see our disclaimer for current positions.