Gemfields Group Limited (AIM:GEM) told investors it expects to see first rubies from the PP2 project, its second plant at the Montepuez ruby mine, in August.
The PP2 is expected to see final completion by September, rather than the original target of September – after slower processing of work permits, equipment delays, and challenges with illegal mining activity impacted the project timeline.
This delay is not expected to hit costs, and Gemfields highlighted that PP2 will triple ore processing capacity, from two hundred tonnes per hour to six hundred tonnes per hour.
It is expected to produce its first rubies in August.
Final completion, including the tailings belt conveyor and decanter centrifuge, is now due in September.
Elsewhere, at the Kagem emerald mine, Gemfields has recently reopened two production points in the Chama pit, with minimal waste mining. And, a ‘measured expansion’ of operations is due to begin in July.
A return to full-scale mining is not yet expected for several months, subject to market conditions for emeralds.
And, the company said it continues to explore strategic options for its Fabergé brand.
Significantly, as highlighted by stockbroker Panmure Liberum, Gemfields is ‘well funded’ thanks to its recent rights issue.
“The MRM slip is disappointing,” said Panmure Liberum analyst Duncan Hay, though he added: “GEM is well capitalised to finalise PP2 (it remains on budget), and there should be a material increase in production (and gemstone quality) from H2 2025 onwards, at a time when demand and pricing for fine-quality rubies remain strong.
Panmure Liberum repeated a ‘Buy’ recommendation, with a price target pitched at 14p (versus today’s price of 4.23p).