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(Alliance News) - Gemfields Group Ltd on Monday said it expects its profit to more than double due to robust demand for coloured gemstones, including emeralds and rubies.
The London-headquartered gemstones supplier said its net profit after tax is likely to surge to USD56.7 million, or ZAR864.0 million, for the six months that ended June 30, up from USD23.8 million, or ZAR346.0 million, in the prior year.
Earnings per share is seen leaping to 3.0 US cents from 2.0 cents. Headline earnings per share, which includes Sedibelo's fair value loss, is expected to rise to 3.0 cents from 2.0 cents.
Gemfields' two key operating assets, Montepuez Ruby Mine and Kagem Emerald Mine, generated revenue of USD95.6 million and USD85.2 million, respectively, up sharply from USD58.9 million and USD31.2 million.
"2022 saw the group return to its normal auction schedule of two emerald auctions and one ruby auction in the first half of the year," the company said.
"Following on from the strong auction results in the second half of 2021, the auctions held in the first half of 2022 saw a continuation of the robust demand for coloured gemstones with record auction revenues and per carat prices being realised."
Faberge recorded revenue of USD9.5 million, higher from USD4.9 million, driven by stronger wholesale sales and the sale of the 'Faberge X Games of Thrones' egg for USD2.2 million.
Less positively, a review of Gemfields' shareholding in Sedibelo Resources Ltd, previously known as Sedibelo Platinum Mines Ltd, has resulted in a fair value write down of USD4.2 million to USD33.0 million.
The write down of the asset reflects the uncertainty in the market putting downward pressure on the enterprise values of Sedibelo and its peer group.
The company's interim financial results are expected to be released on Thursday.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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