REG - Gemfields Group Ltd - Updated 'G-Factor for Natural Resources' figures

GemfieldsAnnouncement

24/04/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240424:nRSX7712La&default-theme=true

RNS Number : 7712L  Gemfields Group Limited  24 April 2024

Incorporated in Guernsey. Guernsey registration Number: 47656

South African external company registration number 2009/012636/10

Share code on JSE: GML / AIM: GEM

ISIN: GG00BG0KTL52 | LEI: 21380017GAVXTCYS5R31

("Gemfields" or the "Company")

Gemfields releases updated 'G-Factor for Natural Resources' figures to 31
December 2023

LONDON, 24 APRIL 2024

In July 2021, Gemfields announced the 'G-Factor for Natural Resources', a
measure promoting greater transparency regarding the level of natural resource
wealth shared with the governments of host countries, whether from the mining,
oil, gas, timber or fishing sectors.

Today, Gemfields announces updated figures to 31 December 2023 and again
invites governance bodies, extractive companies, industry observers and host
governments to adopt the G-Factor for Natural Resources in order to improve
transparency and accountability regarding the share of natural resource wealth
paid to a host country's government.

The G-Factor for Natural Resources is intended to be an uncomplicated
indicator of the percentage of a natural resource company's revenue that is
paid to the host country's government in primary and direct taxes (plus, where
the host government is a shareholder, dividends). As such, it is an indicator
of the share of natural resource wealth paid to a host country's government.
It is also an indicator of the efficiency of natural resources companies in
converting those natural resources into funds for the host government. The
G-Factor for Natural Resources takes its name from the "g's" in "government",
"governance" and "good practice".

"Given the desire by governments to increase their participation in their
country's natural resources, a practical measure allowing a direct comparison
of the sharing of natural resource wealth assists greatly in identifying
responsible custodians of host nations' resources. The G-Factor for Natural
Resources provides a simple 'school score' allowing observers to assess the
relative efficiency of extractives companies in converting natural resources
into wealth for host-nations. In order to better align with practices in other
countries in our region, we have this year added export duties and levies as
an additional parameter in the calculation. We hope the G-Factor for Natural
Resources will be voluntarily adopted by other companies, insisted upon by
host governments and incorporated into projects such as Extractive Industries
Transparency Initiative ("EITI")." said Sean Gilbertson, Gemfields CEO.

G-Factor for Natural Resources computations for Gemfields' two key mining
subsidiaries (the Kagem emerald mine in Zambia and the Montepuez ruby mine in
Mozambique) are set out below:

 Montepuez Ruby Mining Limitada (Mozambique), USD million  G-Factor   G-Factor    G-Factor     G-Factor

                                                           (1 Year)   (5 Years)   (10 Years)   (since Gemfields acquired 75%)

                                                           2023       2019-2023   2014-2023    2012-2023
 (A)   Mineral Royalties Paid                              14.3       52.2        98.9         98.9
 (B)   Corporation Tax Paid                                38.9       89.1        158.4        158.4
 (C)   Dividends to Government (if applicable)             -          -           -            -
 (D)  Export Taxes/Levies                                  -          -           -            -
 Total to Government (A+B+C+D)                             53.2       141.4       257.4        257.4
 (E)   Total Company Revenue                               151.3      586.9       1,054.4      1,055.2

 G-Factor, being (A+B+C+D)/E                               35%        24%         24%          24%

 NOTES:                                                                                        Gemfields announced the completion of its acquisition of 75% in MRM on 27

                                                                                             February 2012. Mining commenced 2012. Auctions commenced 2014.

 

 

 

 Kagem Mining Limited                           G-Factor   G-Factor    G-Factor     G-Factor

 (Zambia), USD million                          (1 Year)   (5 Years)   (10 Years)   (since Gemfields acquired 75%)

                                                2023       2019-2023   2014-2023    2008-2023
 (A)   Mineral Royalties Paid                   5.5        27.0        52.4         64.4
 (B)   Corporation Tax Paid                     17.7       42.1        87.7         99.2
 (C)  Dividends to Government (if applicable)   5.0        6.5         15.0         19.0
 (D)  Export Taxes/Levies                       -          12.4        12.4         12.4
 Total to Government (A+B+C+D)                  28.3       88.1        167.5        195.1
 (E) Total Company Revenue                      92.7       449.6       788.4        1,008.9

 G-Factor, being (A+B+C+D)/E                    31%        20%         21%          19%

 NOTES:                                                                             Gemfields completed the acquisition of a 75% interest in Kagem on 5 June 2008.

 

The 'G-Factor for Natural Resources'

The G-Factor for Natural Resourceswould typically be calculated by each
standalone company engaged primarily in the extraction and sale of natural
resources, whether in the mining, oil, gas, timber or fishing sectors.
Accordingly, multi-national natural resource companies would publish the
G-Factor for Natural Resourcesfor each operating subsidiary engaged primarily
in the extraction and sale of natural resources.

The G-Factor for Natural Resourcesis expressed as a percentage and is
calculated as:

 A(p) + B(p) + C(p) + D(p)
 E(p)

where:

·    A = the total mineral royalty (tax on revenue) paid by the reporting
company to the host country government during the period

·    B = the total corporation tax (tax on profit) paid reporting company
to the host country government during the period

·    C = the dividends paid by the reporting company to the host country
government during the period (where the host country government is a
shareholder in the reporting company)

·    D = the total export taxes or export levies paid by the reporting
company to the host country government during the period

·    E = the total revenues of the reporting company during the period

·    p = the relevant period, typically calculated for each of (i) the
prior year; (ii) the preceding 5 years and (iii) the preceding 10 years

·    The sums actually paid during the period (rather than the sums
accrued or falling due during the period) are used for the purposes of A, B, C
and D.

No measure of this type is perfect and it is recognised that:

a.    the G-Factor for Natural Resources is a "rule-of-thumb" - while it
has broad application and is a practical indicator, it is not suited to every
situation;

b.   there are numerous additional and indirect taxes which are not included
in the G-Factor for Natural Resources and which further increase the
contribution made to host nations by natural resource companies. Such taxes
include but are not limited to area/surface charges, social security
contributions, taxation on the salaries of employees, import and export
duties, VAT, etc; and

c.    the variety and variations in natural resource deposits, types and
occurrences lessens the ability to make direct comparisons between companies.

 

-ENDS-

 

Further information on Gemfields Group Limited can be found at:

 GEMFIELDSGROUP.COM (http://WWW.GEMFIELDSGROUP.COM)

 

To join our investor mailing list, contact us on:
ir@gemfields.com (mailto:ir@gemfields.com)

 

For any press enquiries please contact us on:
gemfields@camarco.co.uk (mailto:gemfields@camarco.co.uk)

 

 

ENQUIRIES

 

 

 GEMFIELDS            Sean Gilbertson / David Lovett / Ian Hughes

                      ir@gemfields.com (mailto:ir@gemfields.com)

T:  +44(0) 20 7518 3400
 SPONSOR (JSE)        Investec Bank Limited
 NOMINATED ADVISER    Liberum

(AIM) & BROKER
Scott Mathieson / John More / Anake Singh
                      T: +44(0) 20 3100 2222
 FINANCIAL PR/ IR     Camarco
                      Gordon Poole / Emily Hall

T: +44(0) 20 3757 4980

 

ADDITIONAL INFORMATION ON GEMFIELDS

 

Gemfields is a world-leading responsible miner and marketer of coloured
gemstones. Gemfields is the operator and 75% owner of both the Kagem emerald
mine in Zambia (believed to be the world's single largest producing emerald
mine) and the Montepuez ruby mine in Mozambique (one of the most significant
recently discovered ruby deposits in the world). In addition, Gemfields also
holds controlling interests in various other gemstone mining and prospecting
licences in Zambia, Mozambique, Ethiopia and Madagascar.

 

Gemfields' outright ownership of Fabergé - an iconic and prestigious brand of
exceptional heritage - enables Gemfields to optimise positioning, perception
and consumer awareness of coloured gemstones through Fabergé designs,
advancing the wider group's "mine and market" vision.

 

Gemfields has developed a proprietary grading system and a pioneering auction
platform to provide a consistent supply of coloured gemstones to downstream
markets, a key component of Gemfields' business model that has played an
important role in the growth of the global coloured gemstone sector.

 

GEMFIELDS

GEMFIELDS.COM (https://gemfields.com/) (https://gemfields.com/) | INVESTORS
(https://www.gemfieldsgroup.com/) (https://www.gemfieldsgroup.com/)
|FOUNDATION (https://www.gemfieldsfoundation.org/)

INSTAGRAM (https://www.instagram.com/gemfields/)
(https://www.instagram.com/gemfields/) | FACEBOOK
(https://www.facebook.com/Gemfields/) (https://www.facebook.com/Gemfields/) |
X (https://twitter.com/GemfieldsLtd?lang=en) | YOUTUBE
(https://www.youtube.com/channel/UCArCE0JFtakTP-tHq6v0KVg)

 

FABERGÉ

FABERGÉ.COM (https://www.faberge.com/) | INSTAGRAM
(https://www.instagram.com/officialfaberge/)
(https://www.instagram.com/officialfaberge/) | FACEBOOK
(https://www.facebook.com/OfficialFaberge)
(https://www.facebook.com/OfficialFaberge) | X
(https://twitter.com/OfficialFaberge) | YOUTUBE
(https://www.youtube.com/user/officialfaberge)

 

KAGEM MINING LINKEDIN (https://www.linkedin.com/company/kagem-mining-ltd)

MONTEPUEZ RUBY MINING LINKEDIN
(https://www.linkedin.com/company/montepuez-ruby-mining)

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCMZGZDGFGGDZZ