Burgundy Diamond Mines (BDM) Q1 2025 TU earnings summary

Executive summary

• Q1 2025 was operationally and financially challenging due to the transition from Sable to Point Lake, resulting in lower ore mined, carats recovered, and sales, though grade improved from higher Misery ore contribution.

• Operational issues at Point Lake (muddy, wet ore) and Misery (frozen ore) were resolved by quarter-end, positioning for a production recovery in Q2.

• Achieved 0.8 million carats recovered and 1.2 million carats sold, generating US$73 million in revenue at US$62/ct.

• Entered a diesel fuel offtake agreement with Macquarie Bank, enhancing working capital flexibility.

• Continued cost reduction initiatives, including headcount reductions and optimized 2025 capital expenditure.

Financial highlights

• Revenue for Q1-2025 was US$73 million, down from US$118 million year-over-year, driven by lower carats sold and lower quality goods.

• Adjusted EBITDA was US$6.5 million, down 76% year-over-year.

• Cash position at March 31, 2025 was US$38.8 million, supported by a US$37.3 million fuel offtake arrangement.

• Net debt (including diamond inventories) improved to US$1.0 million, with diamond inventories below normal due to reduced recovery.

• Capital expenditures totaled US$43.9 million, mainly for Point Lake waste pre-stripping.

Outlook and guidance

• Q2 is expected to show a strong recovery in production and carats, with full normalization anticipated by Q3.

• Point Lake open pit to enter full ore production in Q2-2025, with bulk sampling to refine ore understanding.

• First Burgundy-developed mine plan to be released by end of Q2-2025, with longer-term plan expected in H2-2025.

• Cost per carat is expected to improve in Q2 as pre-strip activity reduces and productivity gains are realized.

• Guidance for CY25 will be provided after results from the Point Lake bulk sample are available in June.