Gemfields Swings To Loss On Forced Covid Closures

Gemfields Swings To Loss On Forced Covid Closures

Gemfields posted a sizeable loss for 2020 as it was unable to hold traditional auctions since the pandemic bagan. The company expects to register a net loss of $93.2 million for the year ended 31st December 2020 compared to a net profit of $39.1 million for the comparative period.

“Gemfields’ 2020 auction schedule was severely impacted by the many travel, quarantine and congregating restrictions put in place to mitigate Covid-19 contagion,” Gemfields said.

The company’s last traditional auction was held in February 2020, when $11.4 million was realised from the sale of commercial quality emeralds in Lusaka. The company subsequently conducted a series of sequential emerald mini-auctions (including GJEPC’s India Rough Gemstones Sourcing Show in Jaipur) during November and December 2020, generating total revenues of $10.9 million.

In 2020 therefore, aggregate auction revenues were $22.3 million, a fall of $178.2 million (or approximately 89%) when compared with $200.5 million in 2019. There was no ruby revenue in 2020, it noted. During the year Fabergé recorded revenues of $7.1 million, down 32% versus a year ago.

In a separate statement, Sean Gilbertson, CEO of Gemfields, commented: “Gemfields faced unprecedented challenges in 2020 as a result of Covid-19 and our full year results reflect the magnitude of the impact. The spread of the virus meant that we have been unable to hold auctions in our traditional format since February 2020. This in turn resulted in the group implementing assorted cash saving measures, including suspending operations at the emerald and ruby mines operated by Kagem Mining Limited and Montepuez Ruby Mining Limitada respectively. We believe the difficult decisions taken during 2020 best position Gemfields for an optimal recovery in 2021.”

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