Lucara Diamond Corp. ("Lucara" or the "Company") today reports its results for the quarter ended March 31, 2026. All amounts are in U.S. dollars unless otherwise noted. References to "C$" are to Canadian dollars.
Q1 2026 HIGHLIGHTS
Q1 2026 marked a transformational quarter for Lucara, with the successful completion of its equity and bond financings for the Karowe Underground Project (the "UGP"), strengthening the Company's balance sheet and positioning it for long-term value creation.
Strengthened capital structure and liquidity
Closed a C$165.0 million equity financing on January 29, 2026, reflecting strong investor support.
Successfully issued $350.0 million of senior secured bonds on March 27, 2026, with a tap option which allows for an additional $50.0 million of issuance and an option to establish a revolving credit facility of up to $50.0 million.
Fully repaid $220.0 million of project debt.
Ended the quarter with a strong cash position of $244.3 million (December 31, 2025: $31.9 million).
UGP advancement
Updated feasibility study confirms total capital cost of $779.2 million, with $472.4 million already invested, demonstrating significant project advancement.
Operational resilience and high-value recoveries
Recovered 100 Specials1, including five diamonds greater than 100 carats and one exceeding 300 carats.
Notable recovery of a 36.92 carat blue Type IIB diamond recovered from the run-of-mine stockpile, comprised of ore previously mined but not yet processed, reinforcing Karowe's reputation for rare, high-value stones.
Continued strong processing performance, with throughput aligned with operational expectations.
Continued strong safety record
The Karowe Diamond Mine ("Karowe") registered no lost time injuries during Q1 2026. The rolling twelve-month Total Recordable Injury Frequency Rate (TRIFR) for the Karowe Mine was 0.32 (Q1 2025: 0.36).
Financial performance
Q1 2026 revenue was $21.8 million (Q1 2025: $30.3 million), reflecting a higher proportion of stockpile processing during the period due to unseasonal weather impacting open pit mining. Stockpile material is inherently variable in grade and quality, which affected realized recoveries in the quarter. Open pit mining resumed on March 26, 2026 and is expected to conclude later in the year.
Operating cost per tonne processed of $24.74, reflecting disciplined cost management despite inflationary pressures and transitional mining activities.
Despite lower revenue and higher costs in Q1 2026, the Company is maintaining its full year outlook. Revenue guidance remains unchanged at $100.0 million to $130.0 million, supported by the planned return to open pit mining, with all other guidance parameters also reaffirmed.
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1 Specials are defined as stones above 10.8 carats.
William Lamb, President & CEO commented: "Q1 2026 represents a pivotal milestone for Lucara. The successful execution of our financing strategy for the Karowe Underground Project has strengthened our balance sheet, providing the financial flexibility to advance one of the world's most exceptional diamond assets.
Operationally, Karowe continues to demonstrate its resilience and unique value proposition. The recovery of a 36.92 carat blue diamond, alongside multiple large stones recovered from run-of-mine stockpile material, underscores the consistent delivery of high-quality, premium diamonds that differentiate Lucara globally.
While broader diamond market conditions remain mixed, our focus on large, high-value stones positions us well to benefit from improving fundamentals in this segment.
With steady progress on the underground project and continued operational execution, we are well positioned to unlock long-term value for our shareholders."
KAROWE UNDERGROUND PROJECT UPDATE
The UGP is designed to access the highest value portion of the Karowe orebody, with initial underground production predominantly from the EM/PK(S)2 unit. The UGP is expected to extend the mine life to 2038.
The updated feasibility study announced on January 30, 2026 (link to news release) confirmed a total cost at completion of $779.2 million, including contingency. As at March 31, 2026, $472.4 million had been incurred, with a further $117.7 million committed but not yet incurred. The study incorporates construction progress, updated exchange rates, inclusion of Legacy3 stone values, and revisions to hydrogeological and geomechanical models, mine design, mining method, and scheduling. From H1 2026 to H1 2028, processing will continue using a combination of open pit ore and run-of-mine stockpiled materials, comprising ore previously mined but not yet processed.
The project has been materially de-risked following completion of shaft sinking activities in 2025, including the 776 metre production shaft and 729 metre ventilation shaft. The UGP has achieved 2,249 lost-time injury free days, with a project-to-date TRIFR of 0.54, below the target of 0.90, and a 12-month rolling TRIFR of 0.34.
Total UGP capital expenditures for Q1 2026 were $19.0 million4, primarily related to shaft equipping, lateral development, and surface infrastructure.
During Q1 2026, the ventilation shaft advanced approximately 491 metres of lateral development across the 310-level5 and 285-level, bringing total lateral development to 1,245 metres, ahead of the planned handover stage to the lateral development contractor. Water intersections encountered were effectively managed through targeted grouting. At the production shaft, shaft equipping was completed to surface, including installation of guides and buntons, followed by decommissioning of sinking infrastructure and commencement of headgear internal steel changeover works.
The lateral development contract awarded in Q4 2025, covers all development from the production shaft to the orebody, including extraction, undercut and long-hole drilling level infrastructure, underground crushing facilities, and associated services. During Q1 2026, the contractor completed its site visit and kickoff meeting, with onboarding of key personnel and mobilization activities underway as at March 31, 2026.
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2 EM/PK(S): Eastern magmatic/pyroclastic kimberlite (south).
3 Legacy stone refers to rough stones sold for a value greater than $5.0 million.
4 Excludes qualifying borrowing cost capitalized.
5 Each level is equivalent to a metre above sea level.
Surface infrastructure works continued during the quarter, including civil construction and procurement of long-lead ventilation fan components.
Activities planned for the UGP in Q2 2026 include the following:
Continue with production shaft headgear changeover, including stripping and installation of permanent steel at remaining headgear levels, and advancing bin and chute installation works.
Advance lateral development at the 310-level, including side-loading conveyor installation and sump completion at the 285-level, and initiation of 470-level development works for ore pass raiseboring.
Complete civil works and commence installation of main surface ventilation fans.
Continue with operational readiness including advancing staffing plans, finalizing operating procedures, and preparing for operation and maintenance of permanent infrastructure.
OPERATIONS UPDATE
Open pit mining activities at Karowe were temporarily suspended during the first quarter due to unseasonal and excessive rainfall, resulting in elevated water levels within the pit. Operations resumed in the open pit on March 26, 2026. During this period, the Company maintained uninterrupted processing operations by utilizing run-of-mine stockpiled material. While this approach ensures continued throughput, the increased reliance on stockpiles, which are generally lower in grade and diamond quality, contributed to a softer revenue performance in Q1 2026.
DIAMOND MARKET
The diamond market remains characterized by near-term pricing pressure in mid-range and lower-quality stones due to elevated inventory levels and cautious consumer demand, alongside continued competition from lab-grown diamonds. However, prices for larger, high-quality natural diamonds have shown signs of stability, supported by constrained global supply and recent price increases for stones above five carats, as announced by De Beers. Longer-term supply fundamentals remain supportive, with declining production from major producers.
FINANCIAL HIGHLIGHTS, Q1 2026
Three months ended March 31,
In millions of U.S. dollars, except carats sold
2026
2025
Revenues
$ 21.8
$ 30.3
Operating expenses
(21.6)
(14.0)
Net loss from operations
(14.6)
(0.1)
Loss per share from operations (basic and diluted)
(0.01)
(0.00)
Cash and restricted cash
244.3
18.7
CORA6
-
50.5
Amounts drawn on WCF
-
30.0
Amounts drawn on Project Facility
