Gemfields forecasts a more than doubling of its interim profit
GEMFIELDS, the supplier of coloured gemstones, said yesterday that for the six months ending June 30, 2022, it expected its net profit after tax to more than double as auctions return to normal schedule.
Auctions were disrupted in 2020 and 2021 after the Covid-19 pandemic outbreak.
In a trading statement ahead of its interim results, it said it was likely that net profit after tax would rise by 149.7% year-year to R864 million.
It expects headline earnings per share to increase by 133.33% to 0.56 cents.
The Gemfields Group, based in London and listed on the Johannesburg and London stock exchanges, is focused on mining emeralds at the Kagem mine in Zambia and the Montepuez ruby mine in Mozambique.
Gemfields said its two key operating assets, MRM and Kagem, generated revenues of $95.6m (R1.7 billion) and $85.2m respectively, during the reported period while in the comparative period MRM achieved $58.9m and Kagem $31.2m. “This year saw the group return to its normal auction schedule of two emerald auctions and one ruby auction in the first half of the year, the group said.
Following on from the strong auction results in the second half of 2021, the auctions held in the first half of 2022 saw a continuation of the robust demand for coloured gemstones, with record auction revenues and per carat prices being realised,“the group said.
Fabergé recorded revenues of $9.5m compared to $4.9m of the comparative
period, driven by stronger wholesale sales and the sale of the Fabergé X Game of Thrones objet egg for $2.2m.
The group flagged an interim headline share earnings of three US cents (54 SA cents/share) which compares to two cents for the corresponding period last year.
“A review of Gemfields’s shareholding in Sedibelo Resources, a platinum group metals producer, has resulted in a fair value write down of $4.2m to $33m.
“The write down of the asset reflects the uncertainty in the market putting downwards pressure on the
enterprise values of Sedibelo and its peer group,” Gemfields said.
In its latest emerald auction held from August 31 to September 19, Gemfields said it fetched revenues of $32.9m, the second-highest figure ever achieved at a Kagem commercial quality auction.
The company said it would release its financial results for the period ending June 30, 2022, on Thursday, September 29.
Shares of Gemfields closed 5.5% higher at the close of the JSE yesterday. They have increased by 22.4% in the past year.