Gemfields FY09 Loss Jumps from $30.2 million to 201.4 million

Albeit earning $815,456 in revenue for its fiscal year that ended on June 30, 3009, mining company Gemfields reported that its loss grew from $30.2 million to 201.4 million during fiscal 2009. This was due in part to a $249 million impairment charge against Kagem emerald mine in Zambia. With the company using this economic downtime to build its inventory levels, cash on hand fell from $48.1 million to $6.9 million.

Nonetheless, Gemfields will continue to expand its rough sales platform, initiate a sales program for polished and certified gemstones and explore new target sites at Kagem. The company has sought approval from the Zambian government for its plans to open a rough gemstone trading business in Kitwe to facilitate the purchase of rough emeralds from local and small-scale operations in the region.

The mining company expects to continue pursuing a more streamlined supply chain process and to raise consumer awareness of and demand for high-quality, certified coloured gemstones. Gemfields told shareholders that it does not expect significant growth in the coming year due to continued weak market demand, but that it will continue to prepare its operations for future growth in coloured gemstone demand.