Gemfields ruby and corundum production dropped sharply in the first quarter as the gemstone miner focused on areas of higher quality alluvial resources.
London–Colored gemstone miner Gemfields reported that ruby and corundum production from its Montepuez ruby mine in Mozambique plummeted in the first quarter ended Sept. 30, with output down 83 percent year-over-year to 500,000 carats.
Yet the company reported that volume of higher quality rubies recovered rose 96 percent, as it focused on delineating additional areas of higher quality alluvial resources in the area.
The average grade went from 41 carats per ton in the prior-year period to 7 carats per ton in the first quarter of this fiscal year due to a greater proportion of higher quality but lower grade alluvial ore deposit processed during the three-month period.
Total operating costs at Montepuez increased from $4.3 million to $6.1 million year-over-year, again attributed to an increase in scale of exploration, processing and mining activities.
Gemfields’ next auction of predominantly higher quality rubies from Montepuez is slated to take place next month.
Meanwhile, emerald and beryl production from Gemfields’ Kagem mine in Zambia rose 19 percent compared with last year to 7.5 million carats. The average grade also increased, rising 11 percent to 237 carats per ton.
Total operating costs at Kagem in the first quarter went from $10.3 million last year to $11.1 million this year due in large part to the increased scale of mining and exploration activities.
In September, the company held an auction of predominately higher quality rough emeralds in Singapore, where revenue hit $34.7 million. It yielded an overall average of $58.42 per carat, the third highest achieved for a rough emerald auction.
Gemfields’ next auction of predominately lower quality rough emerald and beryl from Kagem will take place this month.
The company said that it still expects production for the 2016 financial year to hit 25 to 30 million carats for rough emeralds and 8 million carats for rough rubies.
During the first quarter, Gemfields-owned jewelry brand Faberge also posted strong results. Gross profit from sales orders increased by 61 percent when compared with first quarter 2014. The number of items included in sales orders was up 241 percent while revenue from sales orders fell 4 percent, as last year’s numbers were skewed by the sale of one exceptionally high value item.
The brand’s first significant print advertising campaign since late 2013 began in September and will continue through the holiday season. It focuses on the Emotion, Devotion and new timepiece collections.