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Gemfields H1 Revenue -46% To $51M; Impacted By Indian Currency Reform

Coloured gemstone producer Gemfields plc reported revenue of $51 million for the six months ended December 30, 2016 — a nearly 46 percent drop from the $94 million for the same period the previous year. The company also slumped to a loss of $13.6 million for the period, as against a profit of $8.2 million the previous year.

The company said the main reason for the decline was the deferral of the higher quality rough emerald auction originally scheduled to take place in December 2016 to February 2017 and a moderated product mix placed on offer at the last ruby auction;

Only two auctions were held during the period, consisting of one commercial quality rough emerald and beryl auction and one mixed quality rough ruby and corundum auction, the company said. The previous period saw three auctions including one higher quality and one commercial quality rough emerald and beryl auction and one mixed to higher quality rough ruby and corundum auction;

The auctions were impacted by Gemfields' decision to allow some of its customers to adjust to the Indian demonetisation programme which was put in place in November 2016. Since the end of the period, the company had successfully held the deferred auction of predominantly higher quality rough emerald during the week commencing February 13 of this year, generating revenue of $22.3 million.

Gemfields plans to hold a further auction of commercial quality rough emerald and beryl as well as another mixed quality rough ruby and corundum auction during the second half of fiscal 2017.

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