TIDMAGTA
RNS Number : 1145W
Agriterra Ltd
25 January 2012
Agriterra Ltd / Ticker: AGTA / Index: AIM / Sector:
Agriculture
25 January 2012
Agriterra Ltd ('Agriterra' or 'the Company')
Expands Cocoa Operations in Sierra Leone
Agriterra Ltd, the AIM listed pan African agricultural company,
announces that its 100% owned subsidiary, Tropical Farms Ltd
('TFL'), is making excellent progress in fulfilling its objective
of becoming a leading buyer, trader and producer of high quality,
sustainable and traceable cocoa in Sierra Leone.
Overview:
-- Buying network expanded to 12 locations, targeting 40 in total by 31 December 2012
-- Expanding buying and trading commodity focus to include coffee and palm oil
-- Negotiations underway to secure a 15-acre site in Sierra
Leone's New Airport Development Zone in Freetown in order to build
a state of the art collateral management facility
-- Advanced discussions to secure a cocoa plantation business in south-east Sierra Leone
-- Strong balance sheet following recent fund raising of US$15 million at 3p per share
-- TFL's activities complement existing beef ranching, maize
milling and farming operations in Mozambique and early stage palm
oil operations in Sierra Leone
Andrew Groves, Agriterra CEO said, "Our cocoa buying and trading
operation in Sierra Leone, TFL, is rapidly advancing its aggressive
growth strategy to become a leading in-country trader of
sustainable and traceable cocoa by the end of the year. In line
with this, it is focussed on building its direct buying register,
securing a major new 15-acre management facility and acquiring a
large cocoa plantation. Having done the leg work and built its
foundation and reputation, it is also looking to expand its
commodity reach to include coffee and palm oil.
"TFL's exciting business model provides a third revenue stream
for Agriterra and complements our other agricultural businesses,
which comprise maize farming and milling, the cattle ranching
business which has reached 2,900-head, feedlot facilities and soon
to be finished abattoir services and palm oil. Importantly, we are
well financed having raised $15million in December 2011 at 3p per
share, have no debt and increasing revenues, and I am therefore
confident that we will achieve our objective of becoming a
substantial pan-African agricultural group."
Further Information
TFL's buying and trading operation, headquartered in Kenema in
the eastern region of Sierra Leone, is expanding rapidly and is
focussed on being a leading buyer, trader and producer of high
quality, sustainable and traceable cocoa. In the six months since
its acquisition, TFL has expanded its buying network from four to
twelve locations and increased the direct buying register to
approximately 3,500 farmers across the country. TFL's roll-out
programme is targeting achieving a network of 40 buying points by
31 December 2012, making it one of the leading in-country traders
of sustainable and traceable cocoa. With an increased network and
strengthened in-country relationships, the Board envisages that TFL
will expand its commodity reach to include coffee and palm oil.
TFL's reputation and business profile is building rapidly
through relationships with farmers and out-grower schemes. TFL
continues to implement initiatives, including modern farm
management techniques and farmer incentive schemes, which have
proved extremely successful in Agriterra's maize production and
process facilities in Mozambique. The Board is confident that
similar results can be achieved with cocoa production in Sierra
Leone and the wider region.
As part of its expansion plans, both in terms of critical mass
and commodity, TFL is in negotiations to secure a 15-acre site in
Sierra Leone's New Airport Development Zone in Freetown in order to
build a state-of-the-art collateral management facility. This will
be TFL's main hub servicing both Freetown and the international
markets for all commodities that TFL is involved with. In addition,
it will have sufficient capacity to handle produce from the planned
plantations TFL intends to invest in. In line with this, TFL is
also in advanced negotiations to acquire a cocoa plantation
business in the south east Sierra Leone.
TFL's activities complement Agriterra's established maize buying
and processing operations in Mozambique and fits well with the
Company's strategy of building a pan-African agricultural company
with other divisions already including maize farming and milling,
cattle ranching and feedlot facilities and abattoir services, which
are currently under construction, in addition to palm oil
operations. The Company continues to invest in the ranching
operations and will provide a full update on these in the near
future.
** ENDS **
For further information please visit www.agriterra-ltd.com or
contact:
Andrew Groves Agriterra Ltd Tel: +44 (0) 20 7408
9200
Jonathan Wright Seymour Pierce Ltd Tel: +44 (0) 20 7107
8000
David Foreman Seymour Pierce Ltd Tel: +44 (0) 20 7107
8000
Hugo de Salis St Brides Media & Finance Tel: +44 (0) 20 7236
Ltd 1177
Susie Geliher St Brides Media & Finance Tel: +44 (0) 20 7236
Ltd 1177
Notes
Agriterra Ltd is an AIM listed agricultural company with four
divisions: beef, maize, cocoa and palm oil. Its cattle ranching
business, Mozbife, currently has a 2,350 strong herd, a land
holding of over 16,000 hectares, a feedlot and a 4,000 head per
month abattoir which is under construction. In addition to selling
meat from its own herds, throughput for the feedlot and abattoir
will be supplemented using cattle bought in from local
communities.
The Company's maize buying and milling operations, DECA and
Compagri, are located in Chimoio and Tete in central and
north-western Mozambique respectively. These collect maize from
circa 350,000 farmers using the Company's own vehicle fleet,
process it into mealie meal, the African staple, and then sell it
back to the local market, into supermarkets and to the World Food
Programme. Combined sales for the year ended 31 May totalled 28,822
tonnes maize meal generating revenue of US$13.6 million.
Agriterra's cocoa business is based in Sierra Leone, through its
100% subsidiary TFL, which is currently a buying and trading
operation, but provides an ideal conduit to branch out into cocoa
production in West Africa. Its strategy is to establish itself as a
secure, sustainable and traceable source of supply to meet the
requirements of the major cocoa consumers who are placing increased
emphasis in this area.
The Company has expanded its portfolio of agricultural products
through the addition of palm oil, and holds a lease over
approximately 45,000 hectares of brownfield agricultural land in an
area suitable for palm oil production in the Pujehun District in
the Southern Province of Sierra Leone. This area of Sierra Leone,
which is close to the Liberian border, receives one the highest
levels of rainfall in Sierra Leone, which in itself, receives some
of the highest rainfall globally. In addition, the lease area is
located on the equatorial belt, which is the most favourable
geographical location for palm oil production.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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