Home News Gemfields Earns Nearly $69 Million In Ruby Auction

Gemfields Earns Nearly $69 Million In Ruby Auction

by Madonna

Gemfields, a miner of colored gemstones (traded on the London Stock Exchange as GEM and the Johannesburg Stock Exchange as GML), reported a successful auction in June, selling nearly $69 million worth of mixed-quality rubies. Almost all of the offered rubies, about 97%, were sold.

This auction marked the 10th anniversary of Gemfields’ initial sale of rubies from the Montepuez mine in Mozambique, which is known as the world’s richest deposit of these red stones. Gemfields owns 75% of the operation, with the remaining 25% owned by its local partner, Mwiriti.


Adrian Banks, Gemfields’ Managing Director of Product and Sales, expressed pride in achieving an average selling price of $300 per carat at this auction. However, the total revenue was slightly lower than the $80.4 million earned in the same period last year and just under the $69.5 million from the December ruby sale.


Gemfields also produces emeralds at the Kagem mine in Zambia. The company acknowledged challenges in the precious gemstone industry, particularly in the diamond sector, due to global declines in demand and economic challenges in key markets like China and the US. These factors, along with increased supply of lab-made diamonds, have led jewelry retailers to exercise caution, impacting sales and profits.


Gemfields saw an 86% decline in pre-tax profit last year, attributed in part to the cancellation of an emerald auction, lower overall carat sales, and a write-down in its platinum group metals investments.

Despite these challenges, Gemfields remains optimistic about market direction, especially with the appointment of former De Beers CEO Bruce Cleaver as Chair and Independent Non-Executive Director. Banks emphasized the company’s strong results and hopes they provide confidence to stakeholders in the sector.

Gemfields believes the colored gemstone market is less susceptible to competition from lab-grown alternatives, as man-made rubies and emeralds have coexisted with mined gemstones for over 120 years without significant market share loss.

Following the news, Gemfields’ shares rose over 5% and were trading at 13p in London mid-afternoon, closing 4.9% higher in Johannesburg. This left Gemfields with a market capitalization of approximately 3.49 billion South African rand (about $195 million).


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