Burgundy Diamond Mines (BDM) Q2 2025 TU earnings summary

Executive summary

• Q2-2025 saw higher ore mined and carats recovered, but lower grade and revenue due to a shift to lower-value Point Lake ore and changes in ore blend.

• Revenue and earnings declined sequentially, with a 29% drop in revenue and a 24% decrease in carats sold compared to Q1-2025.

• Operational focus is shifting to a MUG-only model, with Point Lake on care and maintenance after being deemed uneconomic at current prices.

• Closure of Perth diamond cutting and polishing operations to focus on strategic partnerships and maximize value.

• Misery underground mine life extended by 2.5 years to end of 2027; Fox underground PFS shows robust economics and 14-year mine life.

Financial highlights

• Revenue for Q2-2025 fell 29% compared to Q1-2025, with sales of 0.9 million carats for $52 million at $58/ct average price.

• Adjusted EBITDA loss of $11.6 million in Q2-2025, reflecting lower sales and earnings.

• Cash and cash equivalents at quarter-end were $7.2 million, after significant outflows for fuel repayment, capex, and Point Lake mining preparation.

• Net debt increased to $47.7 million including inventories; net cash position deteriorated to $(84) million.

• Diamond inventory value reduced to $35.9 million after a $7.8 million write-down.

Outlook and guidance

• Batch processing and cost controls are being implemented to reduce fixed costs and improve cash flow.

• MUG production capacity is being increased, with mine life extended to end of 2027.

• Q3-2025 to focus on Misery underground, Sable open pit, and Fox stockpiled ore.

• Flexibility to resume Point Lake operations is retained, pending market conditions; mining may resume mid-2026 if prices improve.

• Ongoing assessment of opportunities to strengthen the balance sheet.