Lucara Diamond (LUC:TSX) has been one of the better performing mining stocks over the last couple years. This morning the company held their Q4/ 2014 year end conference call, and we listened in to get the latest from CEO, William Lamb.
Lucara is coming off a strong year with revenues of $265.5 million on sales of 412,136 carats. The company has benefited from finding large diamonds which sell for huge premiums - the average price per carat on these exceptionally large stone tenders was $32,471 per carat in 2014. An average sales price of $644 per carat resulted in a net profit of $45.7 million.
The cash balance as of December 31,2014 was $100.8 million. Strong financial performance has enabled management to issue a dividend of 8 cents for 2014, which included a 4 cent special pay out.
William Lamb, President and Chief Executive Officer commented "We are very pleased that our second full year of operations saw us deliver on our major commitments to our shareholders through operational delivery which resulted in us selling over 412,000 carats for $266 million at an operating margin in excess of 80%.
The outlook for 2015 is for revenue somewhere between $230-$240 million, which is slightly below 2014. A plant optimization project is under way which will allow for harder, more dense ore to be processed. A slight delay on the project (1-2 weeks) has been caused by heavy rains, however this should not affect production guidance and commissioning is expected late in the first quarter.
Dundee is out this morning with a research report and high risk buy target of $2.80 on Lucara stock.
Lucara is a Lundin based company that has Eira Thomas (CEO of Kaminak Gold) on the board. The Lundin/Thomas partnership has proven to be a winner, and interested investors may want to keep an eye on North Arrow Minerals (NAR.V) as well, which is another exciting diamond play involving Thomas and Lundin.
See our recent interview on North Arrow Minerals with CEO, Ken Armstong here (Gem Hunting with a Diamond Pioneer).
Read: Lucara Reports Strong 2014 Operational and Financial Results
Related: Lucara to look for more big diamonds in Botswana
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This is not investment advice. All facts are to be checked and verified by reader. As always please do your own due diligence.