Ian Harebottle, chief executive of Gemfields (LON:GEM), described the payment of a first dividend by Kagem Mining, its 75%-owned emerald producer in Zambia, as a “truly remarkable milestone”.
The US$8mln cash distribution is thought to be the first ever by in the project’s 29-year history and represents the first time the Zambian government, which owns the other 25%, has received cash from the operation.
At a media briefing in Lusaka on Friday, the country’s Minister of Finance, Alexander Chikwanda, said: "Although this is the first time that a dividend is being received from a gemstone mine, I am confident that this is just the beginning of the good things to come from gemstone mining in Zambia.
“Most likely it is as a result of not only hard work and dedication but also the measures that Kagem undertook in the last five years in conjunction with the government to restructure, re-develop and expand the Kagem mine."
The dividend represents a tangible financial result from the turnaround strategy put in place Harebottle and his team, which has utterly transformed the output and economics of Kagem since 2008.
Kagem has also been at the forefront of developing the international market for Zambian emeralds by developing a competitive, reliable and trusted source of ethically produced gemstones.
A key supporting initiative has been the appointment by Gemfields of Hollywood movie star Mila Kunis as the company's global brand ambassador.
Harebottle said: "This dividend - a truly remarkable milestone - is the culmination of more than five years of very hard work.”
He added: “Kagem is the flag-bearer of the Zambian gemstone sector, and one of the finest examples of what can be achieved in partnerships between government and foreign investors in the mining sphere.
“We would like to thank and congratulate our partners in the Zambian government for their role and support in reaching this excellent result."