CollectionsFeb 21, 2025
Piece of the Week: Jade Ruzzo’s ‘Tennessee’ Oval Drop EarringsHeidi Gardner, an SNL cast member, wore the smoky quartz earrings on the “SNL50: The Anniversary Special” red carpet on Sunday.
SourcingApr 01, 2019
Gemfields Reports $60M Loss in 2018
A new tax levied in Zambia played a significant part in putting the colored stone miner in the red for the full year.
Gemfields recovered the 5,655-carat “Inkalamu” emerald from its Kagem mine in October and sold it a month later for an undisclosed amount to Dia-Color.
London—Gemfields recorded a net loss in 2018, hurt in part by a new tax levied in Zambia and a costly court case.
In its full year ended Dec. 31, which was first full fiscal year for the company since the July 2017 takeover of its biggest investor, Pallinghurst, Gemfields reported revenue of $206.1 million, a 252 percent increase over 2017. This was the first time it crossed the $200-million mark, the colored gemstone miner noted.
EBITDA also increased, from $30.5 million to $58.9 million.
Even with revenue hitting a new high, the company recorded a $60.4 million loss for the fiscal year, hurt by the fair-value loss on the Sedibelo platinum mines, in which Gemfields holds a 6.5 percent stake, a $22.6 million impairment charge applied to Kagem because of newly implemented tax changes in Zambia and a costly court case.
Starting Jan. 1, the Zambian government introduced a 15 percent export duty on gemstones and metals to help reduce the country’s debt. When combined with the existing 6 percent mineral royalty already levied on gemstones, it increases Gemfields’ total tax on revenue at Kagem to 21 percent.
Also last fiscal year, a group of Mozambicans filed a lawsuit against the London-based colored gemstone miner over alleged human rights abuses at the company’s Montepuez ruby mine. In January, Gemfields agreed to pay $7.6 million on a no-admission-of-liability basis to settle the lawsuit.
Gemfields’ share price reflected the challenges it faced at its operations throughout the year, falling 40 percent by the end of the year.
RELATED CONTENT: Fallout from Nirav Modi Scandal Hits GemfieldsIn its annual results release, Chairman Brian Gilbertson said the company’s biggest challenge in the coming months will lie in Zambia. In addition to the higher taxes, he noted that the mineral royalty is no longer tax-deductible for corporations.
Because of the new taxes enacted, Gemfields has recognized an impairment loss of $22.6 million in respect to Kagem, its emerald mine there that faces other market headwinds as well.
Production in the “premium” category at Kagem reached 224,000 carats, representing a 400 percent increase in the category’s production in the 12-month period to June 2017 (Gemfields included pre-acquisition figures for the full-year t June 30, 2017, where possible to allow for better comparability).
Kagem also set new records for ore production and total carats produced. However, as production soared, the emerald market struggled.
Editors' Picks
Sponsored by
Most of Gemfields’ emerald dcustomers operate in India and, as such, were grappling with deflating property prices in Jaipur, lack of liquidity and heightened regulatory scrutiny in India following the Nirav Modi scandal.
As a result, the four emerald auctions during the year generated revenues of $60.3 million, which Gemfields called “tolerable” given the financial and regulatory oversight challenges facing Indian customers.
Higher-quality emerald auctions held during the year yielded a slight increase in average per-carat price, achieving $65.55 compared with $63.63 per carat in the 12-month period ended June 2017.
The per-carat average for commercial-quality emeralds was flat, achieving $3.54 per carat on average in 2018 compared with $3.53 per carat in the year up to June 2017.
Gemfields also faces challenges in Ethiopia, where it was mining emeralds.
In July 2018, a mob overran its mining operations and a month later looted the site. Its 110-person team there has been reduced to a handful, the company said, as it works to find a way to restart bulk sampling.
In 2018, the mining area produced a total of 2.9 million carats of ruby and corundum.
Faberge, meanwhile, reported record revenues of $13.4 million in 2018 and saw triple-digit growth in online sales.
As a result, the four emerald auctions during the year generated revenues of $60.3 million, which Gemfields called “tolerable” given the financial and regulatory oversight challenges facing Indian customers.
Higher-quality emerald auctions held during the year yielded a slight increase in average per-carat price, achieving $65.55 compared with $63.63 per carat in the 12-month period ended June 2017.
The per-carat average for commercial-quality emeralds was flat, achieving $3.54 per carat on average in 2018 compared with $3.53 per carat in the year up to June 2017.
Gemfields also faces challenges in Ethiopia, where it was mining emeralds.
In July 2018, a mob overran its mining operations and a month later looted the site. Its 110-person team there has been reduced to a handful, the company said, as it works to find a way to restart bulk sampling.
RELATED CONTENT: Gemfields Opens $15M Automated Sort House in MozambiqueMeanwhile, Gemfields’ operations in Mozambique, where it mines ruby and corundum, generated revenues of $127.1 million from the two Montepuez auctions of mixed-quality rubies held during the year, with the June auction seeing record results of $71.8 million.
In 2018, the mining area produced a total of 2.9 million carats of ruby and corundum.
Faberge, meanwhile, reported record revenues of $13.4 million in 2018 and saw triple-digit growth in online sales.
More on Sourcing
The Latest
MajorsFeb 21, 2025
24 Karat Club of New York Names New PresidentThe organization also announced its newly elected officers and directors.
SourcingFeb 20, 2025
Harry Winston’s Son Donates Fancy Red Diamond to the SmithsonianRonald Winston is giving the 2.33-carat “Winston Red” to the Smithsonian, 67 years after his father donated the Hope Diamond.
Brought to you by
Get Ready for the JA New York Spring ShowThis year will feature a new MJSA Showcase and partnership with Piazza Italia.
SourcingFeb 20, 2025
GJEPC Names New Chairman, Vice ChairmanKirit Bhansali, a partner in Smital Gems and chairman of India Jewellery Park, will take on the role of chairman.
Weekly QuizFeb 21, 2025
This Week’s QuizTest your jewelry news knowledge by answering these questions.
IndependentsFeb 20, 2025
IJO Elects 4 New Board MembersAlisha Cornett, Nic Faini, Eric Stevens, and Seth Shipley have joined the organization’s board of directors for a three-year term.
CrimeFeb 19, 2025
Brink’s to Pay $42M After Admitting to Illegally Transporting MoneyThe company has to pay the Justice Department and FinCEN for violating the Bank Secrecy Act, the U.S.’s main anti-money laundering law.
Brought to you by
3 Ways to Capitalize on America’s Newfound Love of Colored GemsColored stones are stepping into a jewelry spotlight typically reserved for diamonds—are you ready to sell color?
SourcingFeb 19, 2025
Diamond Mining Company CEO Steps Down Amid Sales Slump, LayoffsPetra Diamonds Ltd. CEO Richard Duffy resigned as the diamond miner reported a 30 percent drop in sales to start its fiscal year.
ColumnistsFeb 19, 2025
The Smart Lab: Maximizing Your Jewelry Brand on PinterestPinterest is a potential gold mine for jewelry brands, Emmanuel Raheb writes, provided they follow these five tips.
MajorsFeb 19, 2025
Cartier Opens New Store Inside LAXThe boutique is the French luxury brand’s first airport store on the West Coast.
CollectionsFeb 19, 2025
Swarovski’s NYC Flagship Celebrates Ariana Grande CollabThe store’s facade now features the iconic swan logo and campaign images of the “Wicked” star.
Policies & IssuesFeb 18, 2025
New Customs Requirements for Diamond Imports: What We KnowBeginning in April, companies importing diamonds into the United States will have to list the country in which the diamonds were mined.
AuctionsFeb 18, 2025
A Menagerie of Fabergé Coming to Sotheby’sAround 30 whimsical Fabergé animal carvings will go up for auction at Sotheby’s Geneva in May.
SourcingFeb 18, 2025
Celine Assimon Stepping Down as CEO of De Beers JewellersAssimon will be leaving at the end of February after nearly five years with De Beers.
CollectionsFeb 18, 2025
Tabayer Debuts Its First Men’s Jewelry SelectionsDesigns from the brand’s “Oera” collection have been reimagined with modern masculinity in mind.
SourcingFeb 14, 2025
Navneet Gems Now Offering Unheated Montana SapphiresThe wholesale collection features material from the Rock Creek mine in a variety of colors.
CollectionsFeb 14, 2025
Carolyn Rafaelian Partners with ‘Long Island Medium’ StarThe “Divinely Guided” collection, created in collaboration with Theresa Caputo, features symbols that celebrate the power of connection.
CollectionsFeb 14, 2025
Piece of the Week: Lorraine West’s Diamond ‘Open Heart’ RingShow some love on Valentine’s Day with this 14-karat yellow gold ring that features pavé diamonds.
CrimeFeb 13, 2025
Macy’s Employee Foils $1.5M Jewelry Theft The employee confronted the thief, causing the suspect to flee and leave behind the suitcases full of jewelry.
SourcingFeb 13, 2025
Namibian Diamond Co. Suspends CEO, COO After Deadly Heist Namib Desert Diamonds also put its security manager on leave following last month’s robbery that left one employee dead.
Events & AwardsFeb 13, 2025
AGTA Announces Buyer’s Choice Award Winners for Spectrum, Cutting EdgeAGTA recently concluded its 2025 GemFair event in Tucson and is already gearing up for next year’s show, set for Feb. 2-6, 2026.
CollectionsFeb 13, 2025
Royal Chain Releases Its Spring 2025 CatalogMore than 400 new pieces are featured in the supplier’s latest catalog.
TrendsFeb 13, 2025
Amanda’s Style File: Hearts for Valentine’s DayThis curation celebrates love with heart-shaped jewelry of all shapes and sizes.
Policies & IssuesFeb 13, 2025
Jewelers Relief Fund Reopened to Aid Victims of LA Fires The fund is collecting money for jewelry businesses damaged by the wildfires in Los Angeles County.
TrendsFeb 12, 2025
5 Engagement Ring Trends Expected to Rule 2025From chunky bands to vintage diamond cuts and bezel settings, these are the trends experts are seeing take over the bridal market.
EditorsFeb 12, 2025
Q&A: Marion Fasel on the History of Diamond Engagement RingsFasel discusses researching her new book, the most enduring engagement ring styles, and the diamond shape Taylor Swift will pick.
