Camellia PLC Trading Update (9903W)
August 24 2022 - 2:00AM
UK Regulatory
TIDMCAM
RNS Number : 9903W
Camellia PLC
24 August 2022
24 August 2022
Trading Update
Camellia Plc
Camellia Plc (CAM.L) issues the following update on trading for
the year and confirms the interim results release date.
Trading
Agriculture - Tea
Heavy monsoonal conditions across northern India and Bangladesh
are continuing to result in further reduced production. In India,
lower volumes have resulted in improved pricing over the same
period last year. As previously announced, wage increases in West
Bengal (effective 1 January 2022) have been agreed at 15%,
substantially higher than industry expectations. Wage increases for
Assam have also now been agreed at 13% (effective 1 August 2022).
The benefit of higher prices is not currently expected to fully
offset the impact on profits of the reduced crop and higher
wages.
In Bangladesh, the production impact from very wet weather and
flooding has been further exacerbated by strike action over wages
by tea industry workers during the last 10 days. The wage increase
has been mandated at higher than expected levels of 20.8%
(effective 1 January 2021) and the estates are slowly returning to
work. Although the most recent auction prices are above those of
last year, our average price to the end of July remains below that
of the same period last year.
Agriculture - nuts and fruits
Our macadamia operations continue to harvest and process their
production with volumes expected to be higher than last year.
Although the kernel market is reasonably active there remains a
large inventory of smaller style product carried over from prior
seasons which is impacting on average prices in the market. With
China still enforcing lockdowns, the level of demand has not
recovered in that market and demand in the USA and Japan, although
improving, is still subdued. Pricing, particularly for commercial
grades, continues to be under pressure with no sign of recovery for
the current season.
The Hass avocado season is well underway, with indications that
volumes will be above those of last year. Thus far logistics have
generally worked well despite the challenges presented post
pandemic. Pricing in H1 2022 for the limited sales of estate Hass
made in the period has been below that of the same period of last
year. While prices in the market in recent weeks have improved
considerably it is difficult to predict pricing with any certainty
for the remainder of the season in what is a well-supplied summer
market in Europe.
Other Investments
AJT Engineering continues to face challenges due to supply chain
delays which are impacting on production scheduling and hence
profitability.
BF&M, our 36.9% owned associate, has issued its half year
results for 2022 which, disappointingly, show a shareholders net
loss after tax for the period of Bermudian dollar 12.3 million (H1
2021 - profit after tax Bermudian dollar 14.8 million). Camellia's
share of the results of BF&M for H1 2022 is a loss of GBP4.6
million (H1 2021: profit GBP6.4 million). BF&M's H1 2022
results were negatively impacted by the requirement to mark
investments to market value with movements being taken through the
income statement. Net income from operations after excluding the
negative fair value movements in investments was Bermudian dollar
4.3 million versus Bermudian dollar 13.3 million in the first six
months of 2021. Losses in Q2 have continued to be driven by factors
previously announced on 30 June 2022 including rising interest
rates and stock market volatility. Gross premiums written for H1
2022 increased by 6% from the prior year driven by increased
property premiums and new business. The Life, Health and
Pensions-related businesses experienced higher than anticipated
claims costs and lower underwriting results. Higher reinsurance
costs and a slightly increased incidence of property losses also
impacted BF&M's P&C business in the first half of the year
.
Interim results
Camellia's results for the six months ending 30 June 2022 will
be announced on 1 September 2022.
Outlook
As always, our financial results remain largely dependent on the
Agriculture division where the majority of harvesting, and hence
sales, takes place in the second half of the year. This year, the
results of BF&M, where stock market performance and the
prevalence of hurricanes in the second half of the year are
critical, will also be a significant factor in our results. It is
therefore premature to provide a firm indication of the likely
results for the year.
However, if current trends continue and assuming a normal H2 for
BF&M, the impact of the matters set out above suggests that
although revenue is expected to be slightly above market
expectations, the adjusted profit before tax* for the Group for the
year will be below market expectations but above that of last
year.
The Group's balance sheet remains strong with cash and cash
equivalents net of borrowings at 30 June 2022 of GBP37.1
million.
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.
* adjusted profit before tax seeks to present an indication of
performance which is not impacted by exceptional items or items
considered non-operational in nature and for example it excludes
impairment charges, gains/losses on disposal of assets and
restructuring costs.
Enquiries
Camellia Plc 01622 746655
Malcolm Perkins, Chairman
Susan Walker, CFO
Panmure Gordon 020 7886 2500
Nominated Adviser and Broker
Emma Earl
Erik Anderson
Maitland/AMO
PR
William Clutterbuck 07785 292617
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 or visit 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.
END
TSTDZGZRLFVGZZM
(END) Dow Jones Newswires
August 24, 2022 02:00 ET (06:00 GMT)
Camellia (LSE:CAM)
Historical Stock Chart
From Jun 2024 to Jul 2024
Camellia (LSE:CAM)
Historical Stock Chart
From Jul 2023 to Jul 2024