Sourcing

Gemfields Reports $93M Loss in 2020 Amid Coronavirus Pandemic

SourcingMar 31, 2021

Gemfields Reports $93M Loss in 2020 Amid Coronavirus Pandemic

The colored stone miner wasn’t able to hold any regular auctions during the year.

Gemfields was not able to hold any regular gemstone auctions in 2020 due to the pandemic, severely impacting its bottom line in its full-year financial results.
London—The coronavirus pandemic led to the suspension of Gemfields’ mining operations and its regular auction system, severely impacting its bottom line in 2020.

The company just released its full-year financial results, reporting a drop in revenue and slipping into the red amid a challenging year.

For the year ended Dec. 31, revenue was down 84 percent, plummeting from $216.2 million in 2019 to $34.6 million in 2020. And whereas the company earned a net profit of $39.1 million in 2019, it reported a net loss of $93.2 million for 2020.

The lockdowns during the pandemic meant mines had to shut down.

Gemfields suspended activities at its Kagem emerald mine in Zambia on March 30, 2020 and its Montepuez ruby operations in Mozambique on April 22, 2020.

Restrictions on travel and the movement of goods also meant the miner’s clients weren’t selling inventory at trade events and had no need to purchase more.

Gemfields didn’t hold any “traditional” auctions after its February 2020 sale of commercial-quality emeralds, which saw revenues total $11.5 million. 

In November and December, however, the company held a series of “mini auctions” to test the market. 

There were five small emerald auctions in which clients in Jaipur, Singapore and Tel Aviv were allowed private, in-person viewings of mixed-quality lots. 

Each event took place over five days, with bids accepted via Gemfields’ new online auction platform or by email, marking the first time customers have been able to bid for its Zambian rough emeralds online. 

Forty-six companies placed bids, and Gemfields said it achieved revenues of $10.9 million total and a per-carat average of $59.84, noting it found that rough emerald prices and demand have “held up well.”

“Winning bids were in line with and, in some cases, higher than, pre-COVID prices, and the number of bids per schedule increased, which demonstrates good demand,” the company said. 

No ruby auctions took place last year, but Gemfields did start a series of small auctions for rubies in March and expects them to be completed in early April. 

The company said it will continue with this auction model “in the near term” for both its emeralds and its rubies but hopes to return to a more regular auction format in the fourth quarter of this year. 

Meanwhile, operations at both Kagem and Montepuez have resumed, with the latter’s wash plant and sort house starting in mid-February 2021 and those at Kagem beginning mid-March. 

Gemfields said it anticipates operations to reach full capacity by the end of April. 

Brecken Branstratoris the senior editor, gemstones at National Jeweler, covering sourcing, pricing and other developments in the colored stone sector.

The Latest

AuctionsApr 16, 2021
Try On This Diamond and Pearl Tiara Before It Heads to Auction

Sotheby’s created an Instagram filter for the crown, estimated to sell for up to $1.5 million.

SurveysApr 16, 2021
March Retail Sales Surge

Another round of stimulus checks helped to bolster last month’s retail sales.

CollectionsApr 16, 2021
Supplier Kim International Revives its Catalog

It showcases 2021 and 2022 styles, with most ready to ship from Dallas, Texas.

Brought to you by
4 Reasons You Need This Program for Mother’s Day

Learn how to increase customer loyalty and revenue by making JM™ Care Plan a cornerstone of your business plan.

TrendsApr 16, 2021
Piece of the Week: Anthony Lent’s ‘Lunar Galaxy’ Earrings

Colorful gems enliven a classic celestial motif.

Weekly QuizApr 16, 2021
This Week's Quiz
Test your knowledge of jewelry news from the week of April 12-16, 2021.
Take the Quiz
TechnologyApr 15, 2021
Blue Nile Hires Amazon, Timex Execs

The jewelry retailer named a new chief operating officer and senior vice president of supply chain.

CollectionsApr 15, 2021
Check Out Stone and Strand’s First Bridal Collection

All six styles are priced under $2,000.

Brought to you by
Evaluating Your Inventory For Success in 2021 

After months of pandemic-driven social distancing, restrictions and lock-downs, consumers will be excited to visit your store. Now is the time to ensure you have the right inventory on-hand to capitalize on that excitement!

GradingApr 15, 2021
GCAL Introduces Its New Cut Grade Standard, 8X

Diamonds must receive a grade of “excellent” across eight criteria to be deemed an 8X.

×