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In a slower day for corporate news, precious stones group Gemfields reported its recent emerald auction brought in less, while it's also taken a hit from lower platinum group metal prices. In international news, the European Union (EU) on Monday hit US tech giants with the first ever probes under a new digital law, raising the possibility of eye-watering fines.
Ruby and emerald producer Gemfields, which also owns Fabergé, reported it booked $17.1 million (R324 million) in revenue from an emerald auction held in March, down from $25.5 million in August-September. But it noted as stones vary, in size and quality, the results aren't always comparable. The group had reported the second highest annual revenues in its history at $262 million in the year to end-December, though it felt more pressure from other commodities. The group swung into a $2.8 million loss in 2023, from a profit of $72.3 million, hit by a writedown of its 6.54% holding in Sedibelo Resources, a platinum group metals miner, amid a general downturn for these miners, as well as operating challenges. The value of its stake fell to $4 million from $32 million. Despite this, Gemfields announced an annual $10 million dividend, having paid a final dividend of $35 million in 2022 and an interim dividend of $15 million that year. Shares in the group were down about 3% on Monday afternoon and have lost more than a quarter in the past year.
Clientèle, which provides entry-level life insurance and funeral plan products, reported a 35% fall in net profit to R159 million for its six months to end-December, hit by restatements as it shifted to new accounting standards. The introduction of IFRS 17 resulted in an increase in net asset value but lower current period profits, largely as a result of the discounted value of the cashflows being higher using the closing yield curve and thus creating a loss on this item for the current period, as compared to a profit before, it said. But it still felt pressure from low economic growth and high consumer price inflation coupled with high interest rates, load shedding and unemployment. The value of new business for the period amounted to R125.3 million, a decrease of 36%, but the group added the overall profit margin increased to 9.6% from 4.7% as a result of the higher margin on recurring premium business compared to single premium investment business, given the latter decreased. Shares of the group were down about 4.5% in late-afternoon trade but have still risen almost 5% in the past year.
