Gemfields expects to report a net loss of $60.4-million for the year ended December 31, 2018, compared with the net profit of $45.1-million reported for 2017.

In rand terms, the net loss is expected to be R801-million, compared with a R600-million net profit the year before.

Its loss a share is expected to be $0.05, compared with earnings a share of $0.04 for the comparative year.

In rand terms, the loss a share is expected to be 63c, compared with earnings a share of 49c for the comparative period.

Gemfields is the operator and 75% owner of both the Kagem emerald mine, in Zambia, and the Montepuez ruby mine (MRM), in Mozambique.

It also holds controlling interests in various other gemstone mining and prospecting licences in Zambia, Mozambique, Ethiopia and Madagascar.

MRM and Kagem generated revenues of $127.1-million and $60.3-million respectively, and Fabergé recorded revenues of $13.4-million.

Considering the newly implemented 15% export duty on emeralds and beryl in Zambia, an impairment charge of $22.6-million has been recognised against the company’s Kagem asset for the year.

During the period, the company sold about 60% of its shares in Jupiter Mines as part of Jupiter’s relisting on the ASX, as well as through another Jupiter share buyback.

Gemfields realised profits of $11.7-million from these two transactions and received a dividend payment of $5.2-million.

Gemfields’ remaining stake in Jupiter resulted in an unrealised fair value loss of $11.9-million for the year owing to a decline in the Jupiter share price.

Further, a review of the company’s shareholding in Sedibelo Platinum Mines has resulted in a fair value loss of $47.6-million for the period.

Excluding the impairment charges at Kagem and other Gemfields subsidiary companies and including the fair value losses in Jupiter and Sedibelo, the headline loss a share is expected to be $0.03 for the period, compared with the headline loss a share of $0.06 in 2017.

In rand terms, the headline loss a share is expected to be 43c, compared with a 75c headline loss a share for the comparative period.

Excluding the impairment charges at Kagem and other Gemfields subsidiary companies, as well as the unrealised fair value losses in Jupiter and Sedibelo, the earnings for the year are expected to be $17.1-million, compared with a $5.3-million loss for the comparative period.

In rand terms, earnings for the year are expected to be R227.1-million, compared with a R70.5-million loss for the comparative period.

For part of the comparative earnings period, the results were significantly impacted on by the company’s acquisition of Gemfields Plc (now Gemfields Ltd) and the resulting conversion of the company from an investment entity to an operating mining company, effective August 1, 2017.

The company’s financial results for the year ended December 31, 2018, are expected to be

released on March 25.