23rd Sep 2021 11:32
(Alliance News) - Gemfields Group Ltd on Thursday reported a return to profit for the first half of 2021, as revenue jumped on the resuming of emerald and ruby mini auctions.
For the six months to the end of June, the London-based gemstones supplier posted a pretax profit of USD38.0 million, swinging from a loss of USD66.1 million a year before, on revenue which rose nearly eightfold to USD97.2 million from USD15.0 million.
The revenue figure also reflects a 11% increase from the USD88 million reported for the first half of 2019, a period before operations were affected by the Covid-19 pandemic.
Revenue from the Kagem emerald mine in Zambia more than doubled to USD31.2 million, following the holding of five mini auctions from March 15 to April 17 at robust prices.
Meanwhile, revenue generated from the Montepuez ruby mine in Mozambique came up to USD58.9 million, after the holding of seven mini-auctions between March 15 and April 8 at robust prices, due to built-up demand.
At Kagem, the production of emerald and beryl rose 9.6% to 10.3 million carats from 9.4 million carats, while at Montepuez ruby and corundum output rose 75% to 2.1 million carats from 1.2 million carats.
Looking ahead, Gemfields said the second quarter of 2021 has "provided grounds for optimism", with strong production since restarting mining operations giving confidence that the planned auctions at the end of 2021 will be successful.
In addition, the group said it remains cautiously optimistic that it can meet its long term goal of distributing its maiden dividend, hopefully during 2022.
However, Gemfields said it remains sensitive to several uncertainties, including whether its mining operations can continue uninterrupted, as well as the state of geological and market conditions.
Shares in Gemfields were up 3.4% at 14.48 pence on Thursday in London, while its Johannesburg shares were 0.7% higher at ZAR2.82.
By Dayo Laniyan; [email protected]
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