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(Sharecast News) - Shares in mining outfit Gemfields Group slumped early on Friday after the firm posted a decline in FY revenues and warned of operational challenges in Africa.
Gemfields said total revenues had fallen from $262.0m to $213.0m in FY24, principally due to a "disrupted" emerald market in H224 and lower production of premium rubies at its Montepuez mine in Mozambique.
Underlying earnings margins fell from 31.7% to 19.2% due to lower revenues at both Montepuez and its Kagem assets, the latter of which continues to be on pause. As a result, adjusted headline losses per share came to USD 1.8cents, a sharp reversal compared to the prior year's earnings of USD 1.5cents per share.
Operating costs dropped from $179.0m to $172.0m and Gemfields also noted it expects to see "significantly lower" operating costs in FY25, but the group stated it faced "significant impairment charges" in FY24 from civil unrest in Mozambique and assocaited supply chain issues, as well as the halted mining at Kagem.
Gemfields also announced that it was seeking shareholder approval to issue 556.2m new shares to raise approximately $30.0m by way of a fully committed and underwritten rights issue.
As of 0945 BST, Gemfields shares had sunk 21.28% to 4.62p.
Reporting by Iain Gilbert at Sharecast.com
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