Mumbai: Gemfields has Announced its audited financial results for the year ended December 31, 2019. The company reported record group revenues amounting to US$216.2 million for the period, as compared to revenues of US$206.1 million earned in 2018.
The Company said its free cash flow increased by 16% to US$31.1 million as against a free cash flow of US$26.9 million reported at the end of the previous year. Gemfields’ EBITDA stood at US$80.9 million as against an EBITDA of US$58.9 million recorded for the prior year.
Gemfields repurchased 143 million shares, approximately 10% of the total shares in issue, at an average price of ZAR1.50 per share.
Other highlights include the commissioning of an industry-leading sorting house at the Montepuez ruby mine in Mozambique; and receiving of an extension of the Kagem emerald mining licence for a further 25 years until April 2045.
Gemfields noted that the suspension of the 15% export duty for precious coloured gemstones in Zambia, became effective from January 1, 2020.
The Company has entered into a joint venture agreement signed for gold exploration in Mozambique.
Finally, the Company announced that the Group generated a total of US$30.4 million from the sale of its entire stake in Jupiter Mines Ltd
Mr. Sean Gilbertson, CEO of Gemfields, commented, “We are pleased to report a strong set of results for the 2019 financial year, with the team delivering record group revenues and a healthy growth in operating profit. The successful listing on the AIM division of the London Stock Exchange took place in February 2020, a development which we believe will benefit the Company by providing, over time, greater share trading liquidity and easier access to the precious coloured gemstones sector for a wider audience of international investors.”
He went on to say: “While there were many positives during 2019, the new year has already presented notable challenges including an increase in trespassing artisanal miners at our Montepuez ruby mine in Mozambique and the turmoil triggered by COVID-19. I would like to thank all of our employees, communities and stakeholders for the vigilance that they have shown in managing these challenges and to reassure them of our ongoing efforts to safeguard their welfare.”
Gilbertson noted that while 2019 was a “particularly good year” for Gemfields, the fallout from COVID-19 will have a “material adverse impact” on the Company’s operating and financial performance in 2020.
“Widespread travel and freedom-of-movement restrictions mean that our gemstone auctions, which provided approximately 93% of our revenues in 2019, are on hold for an unknown period of time,” he stressed. “Fortunately, our robust financial position and the historic resilience of coloured gemstones during times of market volatility puts us on a sound footing to face the challenges the remainder of 2020 will bring.”
The Company advised shareholders that “this short form announcement represents a summary of the information contained in the full announcement and does not contain full or complete details of the financial results.”
Gemfields also noted that while the short form announcement itself has not been audited, the financial information included in it has been extracted from the audited annual financial statements which have been audited by the Company’s auditors. Gemfields has not declared a final dividend.
