Gemfields Plc releases interim report for the 6 months ended December 2010.
Gemfields Plc presents its interim report for the six months ended 31 December 2010 (the “Period”).
Key financial indicators:
- Profit for the period of US$ 15,547,789 (2009: Loss of US$5,814,609).
- Revenue from rough and finished emerald sales of US$ 29,051,279 (2009: US$ 12,060,731).
- Cash at bank of US$ 15,508,993 (2009: US$ 7,683,333).
- All bank loans and leases repaid, leaving the Group debt free.
Key operational developments during the financial year:
- Gemstone production in the first six months of the current financial year (18.7 million carats) has exceeded the entire prior year’s production of 17.4 million carats.
- Significant increase in achieved per-carat prices as a result of the continuing increase in demand for consistently supplied ethical emeralds across all major markets.
- Grade of 527 carats per tonne for the 6 month period – significantly above the average of 351 carats per tonne recorded over the last 5 years.
- Unit production costs of approximately US$0.35 per carat versus an historic average of US$0.64 per carat.
Key developments since the end of the period:
- “Gem Mining Company of the Year Award” received at the 57th Annual Tuscon Gem and Mineral Show in January 2011.
- Diamond core drilling and bulk sampling on key targets re-commenced within the Kagem licence area.
- CCTV security system upgrade completed in various key sites, including pit, wash plant and sort house.
- New marketing initiatives implemented, including the Indian “Emeralds for Elephants” project in conjunction with the World Land Trust and Gemfields’ “Uniquely You” emerald advertising campaign.
- Next emerald auction to be held in Jaipur, India, from 10-14 March 2011.
Ian Harebottle, CEO of Gemfields, commented:
"Gemfields has enjoyed an excellent six month period in which our output from the Kagem mine exceeded the entire prior year’s production. In addition, we are seeing a significant increase in global demand for Gemfields’ ability to provide a consistent supply of well graded and ethically sourced emeralds, as is clearly demonstrated by the record sales of USD 19.6 million achieved at the December 2010 auction. Following the encouraging results reported at our previous year–end, the group has continued to enjoyed stronger margins, leaving us with a robust and debt free balance sheet. In line with our ongoing inventory and market building initiatives, we do not intend to host a further high grade auction in the coming half year, meaning that revenues during the second half will be derived ostensibly from the upcoming lower grade auction on 10-14 March 2011."