Profile image - Gemfields group, Kagem - 16072019 - JPG

Gemfields Group

JP: GML

ZAR1837.8m market cap

ZAR1.45 last close

Gemfields is a world-leading supplier of responsibly sourced coloured gemstones. It owns 75% of Montepuez Ruby Mining in Mozambique, 75% of the Kagem emerald mine in Zambia, the Fabergé jewellery business and investments in Jupiter Mines and Sedibelo Platinum.

Investment summary

Gemfields has now completed the buyback of 143m shares at average price of ZAR1.50/share. Given the current weakness in the Gemfields share price (despite a solid set of half year results and stable coloured gemstone market), the company is seeking shareholder approval for a further share buyback for all or part of the remaining US$10.28m distribution pool.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2017A 81.7 30.5 55.8 3.9 2.5 N/A
2018A 206.1 58.9 (22.5) (2.3) N/A N/A
2019E 191.1 49.9 22.2 0.4 24.3 N/A
2020E 216.2 57.6 27.6 0.1 97.2 N/A
Industry outlook

Investors concerned that weak diamond market conditions may also be reflected in coloured gemstones should take heart from Gemfields’ most recent auction results: at Montepuez Ruby Mining’s (MRM’s) June auction 98% of lots sold by weight and one lot achieved a record price per carat; Kagem’s August auction totalled US$18.6m – the highest for a commercial-quality auction since November 2015. Current diamond market challenges are most unique to that sub-sector with very limited read across to coloured gemstones.

Last updated on 06/11/2019
Share price graph
Balance sheet
Forecast net cash (US$m) 44.7
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual (16.7) (10.5) (22.5)
Relative* (22.0) (14.5) (26.8)
52-week high/low ZAR2.1/ZAR1.4
*% relative to local index
Key management
Sean Gilbertson CEO
David Lovett CFO