Gemstone miner Gemfields has never been worth less. The Johannesburg- and London-listed coloured-stone group fell as much as 31% in intraday trade on Monday before recovering to close 17.5% weaker at 66c — its biggest one-day drop since April last year. It capped an already brutal week, coming seven days after the company said long-time CEO Sean Gilbertson was stepping down, which had already knocked the share price down nearly 12% on the day.
Gilbertson will, by mutual agreement with the Board, step down as chief executive and as a director with effect from 15 July 2026. David Lovett, the company's chief financial officer of eight years, has been appointed interim CEO alongside his existing role, with a formal search for a permanent successor to follow. Non-executive chairman Bruce Cleaver has agreed to dedicate additional time to support the business.
Three years that gutted the value
To understand why investors flinched so hard, it helps to look back. The shares reached a record high above R12 when the company was still known as Pallinghurst Resources; since the 2018 name change, the highest they ever traded was R4.34 in 2023. Over the past three years, the dual pressure of armed conflict in Mozambique and a restrictive tax regime in Zambia has wiped out 80% of the ruby and emerald miner's market value.
Both pressures are still live. Just last week the group said attacks on villages as close as 15km from its Mozambique Ruby Mine (MRM) had forced it to pause operations for nearly a day over employee safety, and that roughly 700 illegal miners are breaking into MRM daily. The mine is 75%-owned by Gemfields. In Zambia, a 15% levy on gemstone exports continues to weigh on operations; while that temporary levy was lifted earlier this year, it had already forced the company to suspend mining for the first five months of 2025, denting sales in a way that has been hard to recover from. MRM is also owed $28.3m in VAT refunds as at 30 June, which has materially hurt the mine's cash flow.
Cash raised, but the bleeding continues
Gemfields has not been sitting on its hands. It tapped the market in a $30m rights issue last April, at about R1.07 a share, roughly 40% above where the stock sits now. Four months later it signed off the sale of its Fabergé brand for $50m to secure more working capital. There have been flickers of demand too: the first Trade Select ruby auction, held from 22 to 29 June, generated revenue of $23.1m.
None of it has arrested the slide. With interim results due within the next three months, investors are eagerly awaiting signs of stability in the balance sheet, Gilbertson having promised in his most recent annual letter that the firm would focus on paying off debt this year. The real test now is whether a new hand on the tiller can turn that pledge into a floor under the price.
