Gemfields Group Ltd warned on Friday it is ready to take further measures amid uncertainty after its interim profit slumped by around one third, owing to weak demand for gemstones.
The London-headquartered gemstones miner and marketer indicated that these ‘additional measures’ included cost-cutting and further financing options, if there are ‘material setbacks’.
The company said the weakness seen at its September emerald auction brought ‘some uncertainty’, but it considered it unlikely that the November emerald sale or the December ruby auction would yield below par results.
For the first six months that ended June 30, pretax profit declined 34% to $24.1 million from R 36.4 million a year before.
Revenue for the first half fell 17% to $127.9 million from $153.6 million.
Over the first six months of 2024, Gemfields conducted two emerald auctions, followed by a ruby auction.
Despite slightly weaker sentiment from some customers, all three auctions delivered ‘healthy’ outcomes.
Gemfields said the construction of Montepuez Ruby Mining Ltda’s $70 million second plant was materially on time. It had completed and was now benefiting from Kagem Mining Ltd’s processing plant upgrade.
‘Walking this narrow path is difficult but there is genuine excitement among our management and team members about the position we aim to be in in 12 months’ time and the increased revenues arising after the completion of our ongoing investments,’ Chief Executive Officer Sean Gilbertson said.
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