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GEMFIELDS GROUP LIMITED - Emerald Mini-Auction Results

Release Date: 11/12/2020 14:45
Code(s): GML     PDF:  
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Emerald Mini-Auction Results

Gemfields Group Limited
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")

Emerald Mini-Auction Results

Gemfields is pleased to announce the results of its series of five small and sequential emerald auctions held
during the period 2 November 2020 – 11 December 2020. The mini-auctions comprised of a selection of grades
that are typically offered at Kagem’s auctions of higher quality emeralds. Selected lots were made available for
in-person and private viewings by customers in Tel Aviv, Singapore and Jaipur. Following the viewings, the
auctions took place via an online auction platform specifically adapted for Gemfields and permitting customers
from multiple jurisdictions to participate in a sealed-bid process.

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 – Mini-Auctions

    •   Aggregated auction revenues of USD 10.88 million
    •   Average price of USD 59.84 per carat
    •   Of the 28 lots offered, 24 were sold (86%)
    •   80% of the carats offered were sold
    •   The 36 Kagem auctions (with the recent series of 5 mini-auctions treated as one auction) held since
        July 2009 have generated USD 657.4 million in total revenues

The auction saw 46 companies placing bids and generating total revenues of USD 10.88 million with an overall
average value of USD 59.84 per carat. The auction saw 80% of the offered carats being sold (or 86% of the
number of lots offered).

Gemfields’ 36 auctions of emeralds and beryl mined at Kagem since July 2009 have generated USD 657.4 million
in total revenues. Although not a direct comparison, the results of the four most recent higher quality Kagem
auctions are summarised in the table below along with the aggregated results of the above mentioned five mini-
auctions (and earlier results are available at

                                     May ‘18                    Nov ‘18               May ‘19               Nov ‘19              Nov-Dec ‘20
                                    AUCTION                    AUCTION               AUCTION               AUCTION               AUCTION

                                     15-18 May                 14-17 Nov              14-17 May             18-21 Nov          2 Nov - 11 Dec
Dates                                   2018                      2018                   2019                  2019                  2020
Location                              Lusaka                   Singapore              Singapore             Singapore             Various/
Type                              Higher Quality             Higher Quality        Higher Quality        Higher Quality        Higher Quality
Carats offered                     0.31 million               0.57 million          0.43 million          0.36 million           0.23 million
Carats sold                        0.17 million               0.42 million          0.31 million          0.32 million           0.18 million
No. of companies                        31                         40                    45                    48                     47
placing bids
Average no. of bids per                   8                          8                     8                      9                    11
No. of lots offered                      17                         26                    35                    38                     28
No. of lots sold                         10                         20                    28                    33                     24
Percentage of lots sold                 59%                        77%                   80%                   87%                    86%
Percentage of lots sold                 56%                        74%                   72%                   88%                    80%
by weight
Total sales realised at         USD 10.3 million                USD 28.4              USD 22.4              USD 27.2              USD 10.9
auction                                                          million               million               million               million
Average per carat sales          USD 59.55/carat                  USD                   USD                   USD                USD 59.84 /
value                                                          68.03/carat           71.85/carat           85.26/carat              carat

The specific auction mix and 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 directly comparable.

Gemfields holds sufficient rough gemstone inventory to be able to host one auction of each of (i) mixed quality
rubies (ii) higher quality emeralds and (iii) commercial quality emeralds. Subject to market conditions and Covid-
19 developments, it is presently envisaged that two larger auctions - one each of mixed quality rubies and higher
quality emeralds – will take place in the first quarter of 2021.

Principal operations at both the Kagem emerald mine and the Montepuez ruby mine have been suspended since
March and April 2020 respectively. It is hoped that mining operations will resume by March 2021, subject to
market conditions and Covid-19 developments.

Adrian Banks, Gemfields’ Managing Director of Product & Sales, commented:

“The results of the final four in our series of five online mini-auctions very much echoed what we previously announced in respect of
the first mini-auction on 10 November 2020. Prices remained robust and in a number of instances comfortably exceeded bids
received in pre-Covid-19 auctions. The fact that operations at the world’s largest mines for emerald and ruby have been suspended
since March and April 2020, and may remain suspended until March 2021, clearly also played a role. Total auction revenue in
2020 for the Kagem emerald mine in Zambia therefore stands at USD 22.4 million, a decline of 72% from the USD 79.1 million
attained in 2019. We now look forward to hosting one mixed quality ruby auction and one higher quality emerald auction during                                                                                                  
the first quarter of 2021 and have received very positive feedback from our clients regarding the new BidGemmer online bidding
platform, giving us an important additional tool in 2021. I would like to thank the Kagem Mining and Gemfields sales teams for
their tremendous efforts and for delivering a positive auction result during these very trying times.”


                        Further information on Gemfields Group Limited can be found at:

                                    To join our investor mailing list, contact us on:

                                     For any press enquiries please contact us on:


                                       Sean Gilbertson / David Lovett / Mark Lawrie
                                       T: +44(0) 20 7518 3400

                                       Investec Bank Limited


                                       Nehal Patel

                                       T: +44(0) 20 3100 2222

                                       Christopher Raggett / Tim Redfern / Edward Whiley
                                       T: +44(0) 20 7220 0500

                                       Clayton Bush / Scott Mathieson / Kane Collings

Gemfields Group Limited                                                                                           
                                  T: +44(0) 20 3100 2222

                                  Gordon Poole / Jennifer Renwick / Nick Hennis
                                  T: +44(0) 20 3757 4980


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.


Date: 11-12-2020 02:45:00
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