TIDMGEM
RNS Number : 8836U
Gemfields Group Limited
08 April 2021
Incorporated in Guernsey. Guernsey registration Number:
47656.
South African external company registration number
2009/012636/10
Share code on JSE:GML / AIM:GEM
ISIN: GG00BG0KTL52 | LEI: 21380017GAVXTCYS5R31
("Gemfields" or the "Company")
Ruby Auction Results
LONDON, 8 APRIL 2021
Gemfields is pleased to announce the results of a ruby auction
comprising a series of seven sequential mini-auctions held during
the period 15 March - 8 April 2021. The auction contained a
selection of grades that are typically offered at Montepuez Ruby
Mining Limitada's ("MRM") auctions of mixed quality rubies.
Selected lots were made available for in-person and private
viewings by customers in Bangkok, Dubai and Jaipur. Following the
viewings, the auctions took place via an online auction platform
specifically adapted for Gemfields and which permitted customers
from multiple jurisdictions to participate in a sealed-bid
process.
Operations at MRM were suspended in April 2020 as a result of
the Covid-19 pandemic and remained suspended until March 2021 in
order to preserve cash during difficult market conditions. It is
expected that mining operations at MRM will ramp back up to
full-scale by the end of April 2021.
The rough rubies sold at the auction were all extracted, prior
to April 2020, from the mining licence held and operated by MRM
(which is 75% owned by Gemfields and 25% by local partner Mwiriti
Limitada).
Highlights - March & April 2021 Ruby Auction
-- Operations at the MRM ruby mine were suspended from April 2020 to March 2021
-- All rubies sold at this auction were mined prior to April 2020
-- Total auction revenues of USD 58.9 million, the third highest auction result to date
-- Average price of USD 171.33 per carat
-- Of the 94 lots offered, 89 were sold (95%)
-- 47% of the carats offered at the auction were sold
The auction saw 52 companies placing bids and generating total
revenues of USD 58.9 million with an overall average value of USD
171.33 per carat. The auction saw 95% of the number of lots, and
47% of the offered carats, being sold.
The results of the five most recent mixed quality ruby auctions
are summarised in the table below (and earlier results are
available at www.gemfieldsgroup.com):
Jun '18 Dec '18 Jun '19 Dec '19 Mar-Apr '21
AUCTION RESULTS AUCTION AUCTION AUCTION AUCTION AUCTION
(RUBY & CORUNDUM) (7 sequential
mini-auctions)
5-9 Jun 10-14 Dec 11-15 Jun 10-14 Dec 15 Mar - 8 Apr
Dates 2018 2018 2019 2019 2021
----------------- ----------------- ------------------ ------------------ ------------------
Location Singapore Singapore Singapore Singapore Various/Online
----------------- ----------------- ------------------ ------------------ ------------------
Rough Ruby Rough Ruby Rough Ruby Rough Ruby Rough Ruby
Type (Higher, Medium (Higher, Medium (Higher, Medium (Higher, Medium (Higher, Medium
and Commercial and Commercial and Commercial and Commercial and Commercial
Quality), no Quality), no Quality), no Quality), no Quality), no
Corundum Corundum Corundum Corundum Corundum
----------------- ----------------- ------------------ ------------------ ------------------
Carats offered 629,893 685,363 978,197 1,158,114 726,610
----------------- ----------------- ------------------ ------------------ ------------------
Carats sold 588,656 655,623 962,211 927,130 343,952
----------------- ----------------- ------------------ ------------------ ------------------
No. of lots offered 86 90 90 104 94
----------------- ----------------- ------------------ ------------------ ------------------
No. of lots sold 82 88 84 91 89
----------------- ----------------- ------------------ ------------------ ------------------
Percentage of lots
sold 95% 98% 93% 88% 95%
----------------- ----------------- ------------------ ------------------ ------------------
Percentage of lots
sold by weight 93% 96% 98% 80% *47%
----------------- ----------------- ------------------ ------------------ ------------------
Total sales USD 71.8 million USD 55.3 million USD 50.0 million USD 71.5 million USD 58.9 million
realised at
auction
----------------- ----------------- ------------------ ------------------ ------------------
Average per carat USD 122.03 USD 84.32/carat USD 51.99/carat USD 77.12/carat USD 171.33/carat
sales value /carat
----------------- ----------------- ------------------ ------------------ ------------------
(*) Specific attention is drawn to the fact that one lot of
76,343 grams (representing some 53% of the total weight offered)
remained unsold at the most recent auction. As a result, the
average price per carat realised at the most recent auction is
considerably higher than it would have been had this lot also been
sold. The specific auction mix and quality composition of the lots
offered at each auction vary in characteristics such as size,
colour and clarity on account of variations in mined production and
market demand. Therefore, the results of each auction are not
always directly comparable.
As a result of the Covid-19 pandemic, MRM realised no revenue in
2020. Nonetheless, no redundancies have been made at MRM since the
outbreak of the pandemic and the circa 1,400 jobs provided by MRM
have been protected during what is a critical time for the province
of Cabo Delgado, where MRM is based. Today's ruby auction result
provides much-needed income for the ongoing protection of those
jobs and the many families that depend on the associated salaries.
The auction also brings essential tax income for Mozambique at a
time when the province of Cabo Delgado is in dire need of support.
To date, approximately 23% of MRM's aggregate revenues have been
paid to the Government of Mozambique in the form of mineral royalty
and corporation tax. MRM has been the largest taxpayer in the Cabo
Delgado province in each of the six years from 2014 to 2019.
MRM, located some 280km (as the crow flies) from the town of
Palma, continues to closely monitor developments relating to the
insurgency in Cabo Delgado. The insurgency has displaced an
estimated 700,000 persons. MRM is liaising with the provincial and
central governments about expanding the humanitarian relief MRM
provides. MRM and Gemfields join all those affected by the
insurgency in seeking the restoration of peace, safety and food
security in the region.
Adrian Banks, Gemfields' Managing Director of Product &
Sales, commented:
"This auction, made up of seven sequential mini-auctions, has
yielded the third highest revenue figure of the fourteen auctions
which MRM has run since June 2014. We are very encouraged by the
strong appetite from our clients and by the prices realised.
As a result of the fall-out from the Covid-19 pandemic, this
auction was also our first since December 2019, meaning we realised
no sales at all for some 15 months. Because operations were
suspended at MRM in April 2020, the world's largest ruby mine
produced no new rubies for almost a year, with mining only now
recommencing. Due to the arising supply and demand dynamics, a
number of our clients have therefore seen this auction as a vital
opportunity to purchase rubies, particularly given that MRM is only
now commencing mining for its next mixed-quality ruby auction,
which we hope will occur late this year.
We're truly delighted to be back in business after the lengthy
pause in both mining and sales and we extend our heartfelt thanks
to our hard-working teams, our host government and our clients for
their ongoing support. "
-S-
Further information on Gemfields Group Limited can be found
at:
GEMFIELDSGROUP.COM
To join our investor mailing list, contact us on:
companysecretary@gemfields.com
For any press enquiries please contact us on:
gemfields@camarco.co.uk
ENQUIRIES
GEMFIELDS Sean Gilbertson / David Lovett / Mark
Lawrie
T: +44(0) 20 7518 3400
SPONSOR (JSE) Investec Bank Limited
---------------------------------------
SEDIBELO SALE PROCESS Liberum
Nehal Patel
T: +44(0) 20 3100 2222
---------------------------------------
NOMINATED ADVISER finnCap
(AIM) & JOINT BROKER Christopher Raggett / Tim Redfern
/ Edward Whiley
T: +44(0) 20 7220 0500
---------------------------------------
JOINT BROKER Liberum
Clayton Bush / Scott Mathieson / Kane
Collings
T: +44(0) 20 3100 2222
---------------------------------------
FINANCIAL PR/ IR Camarco
Gordon Poole / Nick Hennis
T: +44(0) 20 3757 4980
---------------------------------------
ADDITIONAL INFORMATION ON GEMFIELDS
Gemfields is a world-leading supplier of responsibly sourced
coloured gemstones. Gemfields is the operator and 75% owner of both
the Kagem emerald mine in Zambia (believed to be the world's single
largest producing emerald mine) and the Montepuez ruby mine in
Mozambique (one of the most significant recently discovered ruby
deposits in the world). In addition, Gemfields also holds
controlling interests in various other gemstone mining and
prospecting licenses in Zambia, Mozambique, Ethiopia and
Madagascar.
Gemfields' outright ownership of Fabergé - an iconic and
prestigious brand of exceptional heritage - enables Gemfields to
optimise positioning, perception and consumer awareness of coloured
gemstones, advancing the wider group's "mine and market"
vision.
Gemfields has developed a proprietary grading system and a
pioneering auction and trading platform to provide a consistent
supply of coloured gemstones to downstream markets, a key component
of Gemfields' business model and has played an important role in
the growth of the global coloured gemstone sector.
GEMFIELDS
GEMFIELDS.COM | INVESTORS | FOUNDATION
INSTAGRAM | FACEBOOK | TWITTER | YOUTUBE
FABERGÉ
FABERGÉ.COM | INSTAGRAM | FACEBOOK | TWITTER | YOUTUBE
KAGEM MINING LINKEDIN
MONTEPUEZ RUBY MINING LINKEDIN
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