Gemfields reports revenue USD216.2 million for year ended 31 Dec 2019

Shareholders are advised that this short form announcement represents a summary of the information contained in the full announcement and does not contain full or complete details of the financial results.

Sean Gilbertson, CEO of Gemfields, commented: “We are pleased to report a strong set of results for the 2019 financial year, with the team delivering record group revenues and a healthy growth in operating profit. The successful listing on the AIM division of the London Stock Exchange took place in February 2020, a development which we believe will benefit the Company by providing, over time, greater share trading liquidity and easier access to the precious coloured gemstones sector for a wider audience of international investors.

While there were many positives during 2019, the new year has already presented notable challenges including an increase in trespassing artisanal miners at our Montepuez ruby mine in Mozambique and the turmoil triggered by COVID-19. I would like to thank all of our employees, communities and stakeholders for the vigilance that they have shown in managing these challenges and to reassure them of our ongoing efforts to safeguard their welfare.

While 2019 was a particularly good year for Gemfields, the fallout from COVID-19 will have a material adverse impact on our operating and financial performance in 2020. Widespread travel and freedom-of-movement restrictions mean that our gemstone auctions, which provided approximately 93% of our revenues in 2019, are on hold for an unknown period of time. Fortunately, our robust financial position and the historic resilience of coloured gemstones during times of market volatility puts us on a sound footing to face the challenges the remainder of 2020 will bring.”

Highlights

• Record Group revenues of USD216.2 million (2018: USD206.1 million)
• Free Cash Flow1 increased by 16% to USD31.1 million (2018: USD26.9 million)
• EBITDA of USD80.9 million (2018: USD58.9 million)
• Repurchase of 143 million shares, approximately 10% of the total shares in issue, at an average price of ZAR1.50 per share
• Commissioned an industry-leading sort house at the Montepuez ruby mine in Mozambique
• Extension of the Kagem emerald mining licence for a further 25 years until April 2045
• Suspension of the 15% export duty for precious coloured gemstones in Zambia, effective from 1 January 2020
• Joint venture agreement signed for gold exploration in Mozambique
• Group generated a total of USD30.4 million from the sale of its entire stake in Jupiter Mines Ltd

Any investment decisions by investors and/or shareholders should be based on the consideration of the full announcement as a whole and shareholders are encouraged to review the full announcement. The 2019 Results containing the audit opinion, including key audit matters, is available for viewing on the Company’s website www.gemfieldsgroup.com. Please follow the link to the full results: https://senspdf.jse.co.za/documents/2020/jse/isse/GMLE/AR19.pdf