Gemfields Grou. Regulatory News (GEM)

GEMFIELDS GROUP Ltd

Incorporated in Guernsey. Guernsey registration Number: 47656.

South African external company registration number 2009/012636/10

Share code on JSE:GML / AIM:GEM

ISIN: GG00BG0KTL52 | LEI: 21380017GAVXTCYS5R31

("Gemfields" or the "Company")

Trading Statement

LONDON, 14 SEPTEMBER 2020

Six months ending 30 June 2020

In accordance with paragraph 3.4(b) of the JSE Limited Listings Requirements, Gemfields is reasonably certain that its net loss after tax will be USD 56.7 million for the six months ending 30 June 2020 compared to a net profit after tax of USD 12.4 million for the six months ending 30 June 2019. In ZAR terms, the net loss after tax is expected to be ZAR 959 million (ZAR 177 million net profit after tax for the comparative period).

Loss per share is expected to be USDc 4.0 for the six months ended 30 June 2020 compared to earnings per share of USDc 1.0 for the comparative period. In ZAR terms, the loss per share is expected to be ZAR 0.74 (ZAR 0.11 earnings per share for the comparative period).

Gemfields' 2020 auction schedule has been severely impacted by the many travel, quarantine and congregating restrictions put in place to mitigate COVID-19 contagion. As a result of the COVID-19 pandemic, Gemfields has only been able to host one auction in 2020, yielding USD 11.5 million from the sale of commercial quality emeralds in February 2020. Auctions originally scheduled for May, June and August 2020 have been cancelled. During the comparative period in 2019 MRM and Kagem generated revenues of USD 50.0 million and USD 33.2 million, respectively. Gemfields remains unable to provide reliable guidance as to when it might next be able to host gemstone auctions or generate meaningful revenue from gemstone sales. During the period Fabergé recorded revenues of USD 2.5 million (USD 3.8 million for the comparative period). A USD 11.5 million impairment charge has been recognised against Fabergé's intangible asset for the period, driven by lower expected revenues as a result of COVID-19 and the general downturn in the market. A review of Gemfields' shareholding in Sedibelo Platinum Mines Ltd ("Sedibelo") has resulted in a fair value write down of USD 12.5 million to USD 45 million.

Excluding the impairment charge against the Fabergé intangible asset (and including the fair value loss against Sedibelo), the headline loss per share is expected to be USDc 3.0 for the six months ending 30 June 2020 compared to headline earnings per share of USDc 1.0 for the comparative period. In ZAR terms, headline loss per share is expected to be ZAR 0.57 (ZAR 0.11 Headline earnings per share for the comparative period).

The Company's weighted average shares in issue during the six months ending 30 June 2020 was 1,169,526,939 (1,314,277,424 during the six months ending 30 June 2019).

1 Net profit after tax is reported on a 100% basis for the current period i.e. inclusive of the minority interest.

2 Per Share metrics and earnings are based on parent only figures i.e. exclusive of the minority interest.

The financial information upon which this trading statement is based is under review by Gemfields' auditors. The Company's financial results for the period ending 30 June 2020 are expected to be released on SENS and RNS on or around 18 September 2020.

Shareholder and analyst webcast

There will be a shareholder and analyst webcast on Friday, 18 September 2020 at 08.30 am (UK) / 09.30 am (South African). Sean Gilbertson and David Lovett will present the Company's 2020 Interim Results.

Shareholders who wish to participate in the webcast are requested to register via the link below:

https://investorpresentations.co.za/gemfields/events/14-gemfields-group-limited-interim-results-presentation  

Shareholders are requested to register for the event by 5pm BST on 17 September 2020.

Should you have any further queries with regards to the proceedings of the event, kindly contact the Company Secretary at the email address below by 5pm BST on 17 September 2020 to obtain further details.

companysecretary@gemfields.com 

-ENDS-

Further information on Gemfields Group Limited can be found at:

 GEMFIELDSGROUP.COM

To join our investor mailing list, contact us on:companysecretary@gemfields.com

For any press enquiries please contact us on:gemfields@camarco.co.uk

ENQUIRIES

ADDITIONAL INFORMATION ON GEMFIELDS

Gemfields is a world-leading supplier of responsibly sourced coloured gemstones. Gemfields is the operator and 75% owner of both the Kagem emerald mine in Zambia (believed to be the world's single largest producing emerald mine) and the Montepuez ruby mine in Mozambique (one of the most significant recently discovered ruby deposits in the world). In addition, Gemfields also holds controlling interests in various other gemstone mining and prospecting licenses in Zambia, Mozambique, Ethiopia and Madagascar.

Gemfields' outright ownership of Fabergé - an iconic and prestigious brand of exceptional heritage - enables Gemfields to optimise positioning, perception and consumer awareness of coloured gemstones, advancing the wider group's "mine and market" vision.

Gemfields has developed a proprietary grading system and a pioneering auction and trading platform to provide a consistent supply of coloured gemstones to downstream markets, a key component of Gemfields' business model and has played an important role in the growth of the global coloured gemstone sector.