Anglo-Eastern Plantations PLC Interim Management Statement (2028H)
May 16 2014 - 2:00AM
UK Regulatory
TIDMAEP
RNS Number : 2028H
Anglo-Eastern Plantations PLC
16 May 2014
16 May 2014
Anglo-Eastern Plantations Plc
("AEP", "Group" or "Company")
Interim Management Statement
Anglo-Eastern Plantations Plc and its subsidiaries, which owns,
operates and develops plantations in Indonesia and Malaysia,
amounting to some 127,800 hectares producing mainly palm oil and
some rubber of which approximately 61,530 hectares are planted,
today announces its Interim Management Statement in respect of the
period since 31 December 2013.
Operational and financial performance
For the first three months ended 31 March 2014, our own
production of fresh fruit bunches ("FFB") was 180,630mt, an
increase of 16% compared to the same period in 2013 (3M13:
155,900mt). FFB bought-in was 135,300mt, which represents an
increase of 104% in comparison with the same period in 2013 (3M13:
66,200mt). Total Crude Palm Oil ("CPO") produced was 64,000mt, 38%
higher than the corresponding period in 2013 (3M13: 46,300mt).
CPO CIF Rotterdam price averaged $904/mt for the first three
months to 31 March 2014. This represents an increase of 7% from the
average of $845/mt recorded in the first quarter of 2013 and is
within our expected price range of $800/mt to $1,000/mt for the
first half of 2014.
The Group's balance sheet remains strong with the Company
continuing to achieve positive cash flow generation. The Company's
Long Term Development Loans totalled $35.0m as at 31 March 2014
(3M13: $25.0m). The increase was due to drawdown of loans to
finance plantation development activities.
Development
New planting by the Group for the first three months ended 31
March 2014 was 427 hectares (3M13: 427 hectares). As indicated in
the preliminary announcement on 8 April 2014, the Group planted
less than planned, due primarily to delays in finalising agreement
with villagers for land compensation payments in Bengkulu and
Bangka. The villagers are asking for compensation beyond what the
Group considered fair and reasonable resulting in protracted
negotiations.
Despite the heavy rainfall also disrupting the earthworks for
construction of the mill in Central Kalimantan in second quarter of
2013, the earthworks are now almost completed and the construction
of mill buildings is in progress. This $18 million mill with an
initial capacity of 45mt/hr is expected to be operational in second
quarter of 2015. As previously reported the construction of another
mill in North Sumatera is deferred while the Board considers
further the relative cost advantages of two selected sites.
The $5 million biogas and biomass project for one of the mills
in North Sumatera is nearing completion. The gas purification plant
was recently installed with hot air ducting, biogas piping and
biogas engine ancillaries' installation to follow. Final testing
and commissioning is expected by the end of second quarter of 2014.
When fully operational, it will result in a significant reduction
in the greenhouse gas emissions which are presently discharged from
the effluent treatment in the anaerobic lagoons.
Outlook
The CPO price closed at $905/mt in mid-May 2014, representing a
2% increase from the start of the year. The CPO price peaked at
$993/mt in early March 2014 on concerns that El Nino weather
pattern could reduce output and forced buyers to reduce purchases.
CPO prices then retreated from the recent 18-month peak due to soft
demand for tropical oil as key consumers in India and China cut
back on purchases. Palm oil imports by India in February 2014
plunged to the lowest in nearly three years. It was also reported
that the Indian consumers are likely to import more sunflower and
soy oil as price differential with CPO narrowed.
Despite this, we anticipate that CPO price will remain generally
stable due to the increase in demand from biodiesel and modest
levels of industry output. The Board remains cautious but expects
to profitability and cash flow to remain in line with management
forecasts for the remainder of 2014.
For further enquiry, contact:
Anglo-Eastern Plantations Plc
Dato' John Lim Ewe Chuan +44 (0)20 7216 4621
Charles Stanley Securities
Russell Cook
Karri Vuori +44 (0)20 7149 6000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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