JOHANNESBURG (miningweekly.com) – Aim-listed precious gems producer Gemfields enjoyed a strong second quarter in the three months to December 31, delivering positive results across all operations, including a 41% increase in year-on-year production volumes at its 75%-owned Kagem emerald mine, in Zambia.

Kagem, the largest producing emerald mine in the world, produced 8.2-million carats of emerald and beryl in the period, a 2.4-million-carat increase on the comparable quarter.

“This is an excellent achievement and clearly demonstrates the positive impact of our ongoing commitment to increased efficiencies and improved mining methods,” stated Gemfields CEO Ian Harebottle, adding that the company’s exploration and bulk-sampling activities were progressing as planned, yielding promising results.

“The coloured gemstone sector appears to have avoided many of the challenges being faced within the diamond and wider resource sector, as we look forward to our upcoming higher-quality emerald auction in March 2016,” noted Harebottle.

Still, Gemfields’ Montepuez ruby mine, in Mozambique, saw a decrease in output, delivering 1.6-million carats of ruby and corundum, compared with 3.4-million carats in the comparable quarter. This was, however, a result of the miner’s focus on delivering additional volumes of higher-quality alluvial ore, according to Harebottle.

“Continuing from the first quarter of this financial year, the bulk sampling operations remained focused on the processing of ore derived from alluvial sources, which are known to deliver lower volumes of significantly higher-quality and higher-value production, resulting in a 1.83% increase in the volume of higher-quality rubies recovered,” he said.

Harebottle said Montepuez continued to produce encouraging results and that it was constantly improving its geographical knowledge and insight across the licence area, providing a high level of confidence that production volumes would soon be supported by the planned shift in mining focus to areas where the grade is known to be higher, but with a commensurate reduction in value, in the coming months.

With this in mind, Gemfields has maintained its production target for the 2016 financial year, against a guidance of between 25-million carats and 30-million carats for rough emeralds and 8-million carats for rough rubies.

Meanwhile, Harebottle highlighted that its Fabergé business continued to reap the benefits of its successful watch campaign, launched in early 2015, and had delivered an increase in both unit sales and total sales revenue during the quarter.
While sales orders agreed during the three months ended December 31 increased by 13% against the corresponding quarter, unit sales orders increased by 48% against the previous year’s second quarter.