Burgundy Diamond Mines (BDM) H2 2024 earnings summary

Executive summary

• 2024 saw consistent ore processing but an 8% lower head grade and 10% lower carat production compared to 2023, with operations transitioning from Sable Pit to Point Lake Pit and continued focus on Misery Underground.

• Achieved 4.9M carats sold in FY 2024, up 3% year-over-year, despite challenging diamond market conditions and lower ore grades from mine transition.

• Revenue reached US$442M, down 6% year-over-year, with EBITDA at US$53M, impacted by a US$151M asset impairment due to lower prices and reserve timing.

• Major productivity improvements included a 10% increase in payloads, an hour gain in shift productivity, and a 20% workforce reduction, helping reduce unit costs.

• Convertible notes of US$23M repaid and environmental bond payment schedule renegotiated, with a US$58M environmental trust established.

Financial highlights

• Revenue declined 6% year-over-year to US$442M, outperforming broader market price drops of 15%-25%.

• EBITDA dropped 144% year-over-year to US$53M, primarily due to a US$151M asset impairment.

• Net cash position fell from CAD 94 million at end-2023 to CAD 25 million (US$25.1M) at end-2024, mainly due to Point Lake stripping CapEx and tax/royalty payments.

• All-in sustaining cost per carat was about $92 in 2024, with a target to reduce to $70-$75 per carat (including CapEx) in the coming years.

• Significant capex of US$98.5M in 2024, with 2025 capex expected to be 25% lower.

Outlook and guidance

• 2025 outlook anticipates commercial production at Point Lake in May and increased production rates at Misery Underground.

• Free cash flow is expected in 2025, contingent on modest price growth and market conditions.

• Guidance for 2025 will be finalized after ongoing work at Misery and Point Lake, likely by the April Q1 call.

• Life of mine plan updates, including Misery extension and Point Lake, are expected by end of Q2.

• Market sentiment improving, with early 2025 sales showing 8–10% price increases and medium- to long-term diamond price strength expected.