Lucapa Slides to Loss in First Half Amid Weak Market 

Lucapa Diamond Company reported a $1.3 million loss in the first half of the year as an ongoing market slowdown led to a decline in prices for the miner’s rough. 

The loss for the six months that ended June 30 contrasted with a profit of $64,000 for the same period a year ago, the company reported last week. Meanwhile, total revenue dropped 24% year on year to $35.6 as the average price fell 26% to $1,213 per carat. Production for the January-to-July period slipped 12% to 27,362 carats. 

The company saw steady demand for diamonds above 2 carats in the first quarter, but that tapered off in the second, it explained. Diamonds weighing more than 10 carats saw steady demand throughout the six months. 

Revenue from Lucapa’s Lulo mine in Angola slipped 18% to $27.2 million as sales volume fell 4% to 13,761 carats, bringing the average price down 15% to $1,976 per carat.  

During the period, the company held four run-of-mine diamond sales and one special tender. The tender, which garnered $10.5 million, included the sale of two rough diamonds weighing 203 and 116 carats. However, a second tender the company had planned for the second quarter got pushed off to July. The postponement of that sale — which included a 195-carat rough, four other high-quality white diamonds, and one pink — lowered the average price, Lucapa noted. 

Lucapa completed six diamond sales from its Mothae mine in Lesotho through its offtake agreement with manufacturer Safdico. The company achieved revenue of $8.4 million, a 38% drop year on year. A decrease in the recovery of high-value rough drove the average price down by 43% to $540 per carat. The miner sold Mothae to Lesotho-based mining-service provider Lephema Executive Transport in June.

Image: The Lulo mine in Angola. (Lucapa Diamond Company)