25th Sep 2024 07:55
(Alliance News) - Gemfields Group Ltd expects interim earnings to slump by a quarter, but maintains that the demand for rough emeralds and rubies remains "healthy".
The London-headquartered gemstones miner and marketer on Wednesday guided for earnings per share and headline EPS of 0.6 US cents for the first six months that ended June 30, down 25% from 0.8 cents a year earlier.
Revenue at its two key operating assets, Kagem Mining Ltd in Zambia and Montepuez Ruby Mining Ltda in Mozambique, was lower over the first half.
Revenue at Kagem Mining declined 20% to USD51.9 million from USD64.6 million, while top-line growth at Montepuez Ruby Mining was USD68.7 million, down 15% from USD80.4 million.
Gemfields said the demand for rough emeralds and rubies remained "healthy", but indicated that production of the highest-quality gemstones at both mines was below its expectations.
Luxury brand Faberge recorded revenue of USD6.6 million, 21% lower than USD8.4 million, amid in a softer luxury-goods market and against a one-off sale of legacy jewellery in the first half last year.
Gemfields said its 6.54% shareholding in Sedibelo Resources Ltd has now been written down to nil from USD4.0 million at the end of 2023. Operations at Sedibelo remain suspended.
It said it considers it unlikely that the November higher-quality emerald auction or the December mixed-quality ruby auction will see below par results.
"While higher-quality gemstones typically remain more robust than lower-quality gemstones in challenging times, we remain vigilant given that the luxury and gemstone sectors are facing greater uncertainty than we have seen in the last three years," Chief Executive Officer Sean Gilbertson said.
The company expects to release its interim financial results on Friday.
By Artwell Dlamini, Alliance News reporter
Comments and questions to [email protected]
Copyright 2024 Alliance News Ltd. All Rights Reserved.