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Lucara Diamond's announcement
on the Full Year Results

Lucara Diamond Corp. is recently announced revenues of $295.5 million or $824 per carat and EBITDA of $185.4 million (all dollar amounts are in US Dollars unless otherwise indicated).

HIGHLIGHTS:

Financial:

  • Revenue for the year was $295.5 million or $824 per carat (2015: $223.8 million and $593 per carat).

  • EBITDA was $185.4 million* for the period (2015: $133.9 million*).

  • Year end cash position of $53.3 million (2015: $134.8 million) following dividend payments of $149.7 million during the period.

  • Full year costs at $26.5* per tonne ore processed were well controlled and within revised cost guidance of $25.0-$28.0 per tonne processed.

  • Earnings per share for the year was $0.19 (2015: $0.21 earnings per share).

  • Full year dividends paid of CA$ 0.51 per share or CA$ 194.7 million (US$149.7 million in dividends). As previously announced, the Company is increasing its regular annual dividend to CA$0.10 per share expected to be paid in four equal payments on a quarterly basis in 2017.

Operational: Karowe Mine

  • New mine contractor, Moolman Mining Botswana (Pty) Ltd a subsidiary of Aveng Mining ("Aveng Moolmans") commenced mobilization to the Karowe mine in February. Since December 2016, during the period of transition to Aveng Moolmans, Karowe has processed ore from stockpile resulting in lower than forecast ore and waste mined for the year.

  • Ore processed for the year was in excess of forecast at 2.6 million tonnes with diamond recoveries totaling 353,974 carats which was in line with forecast.

  • Successful implementation, on time and on budget, in Q3 of the project to increase the top size of diamonds recoverable by the existing Large Diamond Recovery. The Mega Diamond Recovery ("MDR") and the sub middles XRT project are advancing and expected to complete on time and on budget in 2017.

Exploration:

  • Exploration program is well advanced at BK02 and AK11 with results to be released during 2017 when the programs are complete. Drilling will commence at AK13 and AK14 during 2017.

  • Drilling program to test the Karowe AK06 kimberlite at depths below 400m was completed in February 2017.

*Non-IFRS measure, see Q4 2016 MD&A for Non-IFRS measure definitions and reconciliations.

Investment:

  • In Q4 2016, the Company acquired an interest in Tsodilo Resources Limited for $2.5 million in a private placement financing. Tsodilo Resources has title to the Botswana's BK16 project covering an area of 1.02 square kilometers and is located 28 km northeast from Karowe mine.

William Lamb, President and Chief Executive Officer commented "The Company achieved record sales in 2016. We demonstrated our commitment to deliver consistent and sustainable value to our shareholders as well as the strength of our cash flow generation by paying a special dividend during the year, while continuing to advance growth opportunities in Botswana. We remain focused on operating performance at the Karowe mine and are well positioned to continue to drive operating efficiencies and safe productivity in partnership with our new mining contractor. Our capital projects for enhanced diamond recovery are on target to be completed in 2017, ensuring maximum diamond recoveries from the high value south lobe. We also remain excited with our work on resource expansion at the Karowe mine through our deep drilling program and our advanced exploration program in Botswana."