GEMFIELDS GROUP LIMITED - Lusaka Emerald Auction Results

Release Date: 03/08/2018 09:00
Code(s): GML
 
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Lusaka Emerald Auction Results

GEMFIELDS GROUP LIMITED
(formerly Pallinghurst Resources Limited)
(Incorporated in Guernsey)
(Guernsey registration Number: 47656)
(South African external company registration number 2009/012636/10)
Share code on the BSX: PALLRES ISIN: GG00BG0KTL52
Share code on the JSE: GML
"Gemfields" or the "Company")



                                          Lusaka Emerald Auction Results

      Gemfields is pleased to announce the results of an auction of predominantly commercial quality rough emerald held
      in Lusaka, Zambia from 30 July – 2 August 2018. The emeralds were extracted by Kagem Mining Ltd in Zambia
      (“Kagem”, which is 75% owned by Gemfields and 25% by the Industrial Development Corporation of Zambia). The
      proceeds of this auction will be fully repatriated to Kagem in Zambia, with all royalties due to the Government of the
      Republic of Zambia being paid on the full sales prices achieved at the auction.

      Highlights – Emerald Auction

           -    Auction revenues of USD 10.89 million
           -    Of the 21 lots offered, 17 were sold (81%)
           -    Average price of USD 4.21 per carat
           -    90% of the carats offered were sold
           -    The 29 auctions of Kagem gemstones held since July 2009 have generated USD 527.5 million in total
                revenues

      The auction saw 22 companies placing bids, generating total revenues of USD 10.89 million with an overall average
      value of USD 4.21 per carat. Solid demand resulted in 90% of the offered carats being sold (or 81% of the number of
      lots offered).

      Gemfields’ 29 auctions of emeralds and beryl mined at Kagem since July 2009 have generated USD 527.5 million in
      total revenues. The results of the five most recent commercial quality Kagem auctions are summarised in the table
      below:


        AUCTION RESULTS                 May ‘16             Sep ‘16           May ‘17              Feb ‘18          Jul-Aug ‘18
     (COMMERCIAL QUALITY)               AUCTION            AUCTION            AUCTION             AUCTION            AUCTION

                                        17-20 May          26-29 Sep          15-18 May          19-22 Feb         30 Jul – 2 Aug
Dates                                      2016               2016               2017               2018               2018
Location                               Jaipur, India      Jaipur, India      Jaipur, India      Jaipur, India     Lusaka, Zambia
                                       Commercial         Commercial         Commercial         Commercial          Commercial
Type                                      Quality            Quality            Quality            Quality            Quality
Carats offered                         3.67 million       4.05 million       3.10 million       3.73 million        2.89 million
Carats sold                            2.78 million       3.27 million       3.10 million       3.55 million        2.59 million
No. of companies placing bids               26                 30                 33                 31                  22
Average no. of bids per lot                  7                  7                  9                 5                    6
No. of lots offered                         18                 19                 23                 21                  21
No. of lots sold                            14                 15                 23                 19                  17
Percentage of lots sold                    78%                79%                100%               90%                 81%
Percentage of lots sold by weight          76%                81%                100%               95%                 90%
Total sales realised at auction      USD 14.3 million   USD 10.7 million   USD 14.5 million   USD 10.8 million    USD 10.9 million
Average per carat sales value        USD 5.15/carat     USD 3.28/carat     USD 4.68/carat     USD 3.05/carat      USD 4.21/carat
The specific auction mix and the exact quality of the lots offered at each auction vary in characteristics such as size,
colour and clarity on account of variations in mined production and market demand. Therefore the results of each
auction are not always directly comparable.

Sean Gilbertson, CEO of Gemfields, commented:

“Given the difficulties experienced by the Indian gemstone sector this year, the strong results from this auction
underscore the enduring vigour of consumer demand for responsibly sourced Zambian emeralds and the accelerated
recovery that this demand facilitates. While the Indian emerald trade is not out of the woods yet, we take significant
comfort from these Lusaka auction results.

We thank the very hardworking Gemfields and Kagem teams, our customers and our partners in Kagem, the Industrial
Development Corporation of Zambia and look forward to furthering the Zambian emerald sector’s prominence
internationally”.

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.

Further information on Gemfields Group Limited can be found at www.gemfieldsgroup.com.

For any press enquiries please contact us on investor.relations@gemfields.com.



Guernsey
3 August 2018

Sponsor
Investec Bank Limited

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