TIDMAGTA
RNS Number : 9283A
Agriterra Ltd
26 February 2014
Agriterra Ltd / Ticker: AGTA / Index: AIM / Sector:
Agriculture
26 February 2014
Agriterra Ltd ('Agriterra' or 'the Group')
Interim Results
Agriterra Limited, the AIM listed pan-African agricultural
company, announces its results for the six months ended 30 November
2013.
Highlights
-- Strengthened position as a growing agricultural company with
operational divisions comprising beef and maize operations in
Mozambique and cocoa operations in Sierra Leone
-- Continued investment in core operations to allow for
sustainable long-term cash generation and profitability
-- 50% reduction in pre-tax loss on continuing operations to
US$2.1 million; structured development plan being realised in
financial terms - reduction in losses and a trend towards
profitability
-- Continued expansion of vertically integrated "field to fork"
beef operations - herd increased to 5,700 head and opening of
selective retail units
-- Highly successful cattle breeding season - 75% year-on-year
increase in births across Mavonde, Inhazonia and Dombe ranches in
Mozambique
-- Land acquisitions and irrigation implementation programmes at
ranches will accelerate expansion of beef herd and throughput for
Vanduzi feedlot
-- Significant development at the cocoa plantation in Sierra
Leone - initial phase of planting across 200 hectares during the
2013 planting season
-- 350,000 seedlings currently growing in the state-of-the-art
1.7 hectare nursery ahead of 2014 planting season targeting 250
hectares
-- Net Asset Value of US$57.5 million at the period end shows
considerable value upside against the current market cap of $36.7
million
CHAIRMAN'S STATEMENT
In line with our growth strategy Agriterra is continuing to
invest in building operational platforms that will enable
sustainable long-term cash generation and profitability across our
multi-divisional business. Our focus remains on establishing strong
foundations within each division, primarily comprising beef and
maize operations in Mozambique and cocoa operations in Sierra
Leone, building our asset base to "critical mass" and vertically
integrating operations wherever possible. The intention of this
strategy is to grow revenue from our products whilst improving
efficiencies and therefore maximising margins. The board of
Agriterra believe that investment and implementation skills are of
paramount importance and the key to a successful agricultural
business. We have continued to assign capital to implement our
growth strategy, in particular within our beef and cocoa divisions.
We are still in the growth and development phase of both our beef
and cocoa operations, but as a result of recent investments we are
now beginning to see the benefits of our structured development
plan being realised in financial terms, with a reduction in losses
and a trend towards profitability across all divisions.
Beef operations - Mozambique
During the financial year ended 31 May 2013 ('FY2013') we made
significant progress in our beef division, becoming a vertically
integrated beef provider through the construction of our abattoir
and the opening of two retail units. During the current financial
year ('FY2014') we have supplemented these with the opening of new
retail outlets in Manica and Beira in December 2013 and February
2014 respectively. We are particularly excited about Beira, which
is the second largest city in Mozambique and is close to our main
operations in Chimoio. Local demand for beef products is strong in
Beira and we expect volumes and margins to be impressive at this
outlet.
Our cattle herd expansion programme is also on track to reach
10,000 head (excluding feedlot animals) by 2015 and, importantly, a
successful breeding season has delivered a 75% year-on-year
increase in births. The key to our future success from ranching
operations is critical mass; to this end, work to increase the
carrying capacity of our ranches, through further land clearance
and a phased irrigation programme, is currently underway. Once the
newly irrigated land is able to support cattle, we hope to
accelerate our herd growth through the acquisition of further
Beefmaster cattle from South Africa. This accelerated growth will
enable us to reach cash break-even on our ranching operations more
quickly than previously anticipated by increasing the total number
of births each year (thereby increasing the number of animals
available for slaughter within 15 to 18 months thereafter).
With our increasing herd size, a fully operational feedlot, the
abattoir and the continued roll out of retail units, we are well
positioned for the future to maximise returns throughout the whole
'field to fork' value chain. With critical pillars to support
growth in place and a defined investment plan in progress, the
Mozambique beef operations are set to become self-sustaining and
profitable, which should in turn have a favourable impact on the
Group's performance in the years ahead.
Cocoa plantation - Sierra Leone
In Sierra Leone we continue to invest in our cocoa plantation,
an exciting and high value project which, once mature, will
generate significant cash flow for the Group. We completed the
initial phase of planting during the 6 months ended 30 November
2013 ('H1-FY2014') with 250,000 seedlings planted on 200 hectares.
350,000 seedlings are currently growing in our 1.7 hectare nursery
in anticipation of the next phase in our planting schedule, on 250
hectares, which we expect to complete in calendar year 2014. Based
on our current planting schedule and land acquisition strategy, we
anticipate that the plantation will yield at least 8,000 tonnes of
premium grade cocoa beans by 2020/2021. The scalability of the
operation, the attainable production targets and the dynamics of
the cocoa market were all crucial factors in our decision to invest
in this business. In addition, indications that there will be a
shortage of cocoa beans in the world markets over the short to
medium term, which in all likelihood will result in increasing
prices, together mean that we expect our plantation to start
delivering cocoa beans at the right time to capitalise on
increasing prices.
Other operations - Sierra Leone and Mozambique
Our cocoa trading operation has, unfortunately, not performed as
strongly as had been hoped, mainly due to a poor harvest for local
farmers. However, the positive pricing environment, and our focus
on optimising the cost structure of this operation has improved our
returns in the second half of the current financial year.
We are also focussed on the further development of our local
infrastructure in Sierra Leone. In line with this, our new and
enlarged warehouse and trading centre in Kenema is now nearly
complete and we expect to start using it from early March 2014.
With our existing infrastructure, the maturing of our plantation
and support of trading operations, we aim to become Sierra Leone's
largest cocoa producer and the board believe we are on track to
achieve this.
Our maize operations in Mozambique are our most mature business
division and continue to generate significant revenues for the
Group. During H1-FY2014 we have focussed our efforts on improving
margins and net profits in this division. Despite relatively low
volumes in the period, which was impacted by the political
instability in Mozambique, our team's efforts have borne fruit as
the division has returned a net operating profit. The Board has
noted recent improvements in the political situation in Mozambique,
which is returning to normality and in line with this, sales
volumes have increased from January 2014.
Legacy oil interests
In addition to our current operations, the Board continues to
actively pursue the realisation of value from its legacy oil and
gas operations. In this regard, we are engaged in formal
arbitration proceedings with the Government of the Republic of
South Sudan and Nile Petroleum Corporation to recover the
compensation assessed by the National Petroleum Commission as being
due to the Company for works undertaken by the Company and
acknowledged as being due by the Ministry of Petroleum and Mining
of the Republic of South Sudan in April 2012. In addition, Tullow
Oil plc, Africa Oil Corp and Marathon Oil Corporation ('Marathon')
continue to undertake exploration activities on the South Omo oil
block in Ethiopia. An additional payment of US$10m will be due to
Agriterra from Marathon in the event that Marathon participate in a
"commercial discovery" on the block. The timing and exact quantum
of any amounts recovered in respect of these assets cannot be
reliably estimated at this time and they are accordingly not
included in our financial results.
Financial Results
In order to achieve critical mass and a foundation for growth
and profitability in the future, our focus remains on both
expanding our growth divisions, primarily our beef and cocoa
operations, and optimising returns across all divisions. This
strategy is beginning to be reflected in our results - while
revenue decreased to US$7.2 million (H1-FY2013: US$11.5 million)
reflecting lower maize and cocoa sales volumes, the pre-tax loss on
continuing operations decreased by 50% to US$2.1 million
(H1-FY2013: US$4.2 million). This reflects in significant part the
progress made in improving cost efficiency across all divisions,
the focus on margin improvement in our grain business and the
positive impact in our beef business of both the retail units and
the organic growth in our herd.
The net assets of the Group were US$57.5 million at the period
end and cash balances were US$8.7 million (H1-FY2013: US$3.2
million) against a current market cap of $36.7 million.
Outlook
Agricultural businesses are based on long term investment and
the realisation of a growth strategy. While we are still in the
investment phase in both our beef and cocoa businesses, the board
is confident that the progress we have made to date has created a
strong and sustainable platform for our transition into
profitability. The Company has reduced its losses significantly,
reflecting in part the refinement of our cost efficiencies, our
focus on margins and the increasing scale and integration of our
beef operations. As revenues begin to ramp up and our investment
programmes continue, we are in a favourable position to deliver
enhanced financial performance moving forward.
The African agriculture arena remains an area of exceptional
growth potential, and our investments to date in both Mozambique
and Sierra Leone will, I believe, set us at the forefront on this
expanding industry.
P H Edmonds
Chairman
OPERATIONS REVIEW
Agriterra currently has three operational agricultural
divisions:
-- Beef, which conducts cattle ranching, feedlot, abattoir
operations and retail units through Mozbife Limitada
('Mozbife')
-- Cocoa, which manages the Group's cocoa trading and farming
activities through the Tropical Farms group of companies
('TFL')
-- Grain, which operates maize purchasing and processing businesses through Desenvolvimento E ComercializaĆ§Ć£o Agricola Limitada ('DECA') and Compagri Limitada ('Compagri')
Beef Operations (Mozambique)
Agriterra remains focussed on expanding its vertically
integrated "field to fork" beef operations which comprise three
ranches, a feedlot facility, abattoir and retail units in
Mozambique.
The Group's strategy is to leverage value from being a
vertically integrated producer, supplemented by local purchasing of
cattle. Agriterra rear and breed the beef cattle at the Mavonde,
Inhazanoia and Dombe ranches, fatten at the Vanduzi feedlot, and
slaughter and butcher at the Chimoio Abattoir, which in turn
supplies the retail units in Chimoio,Tete, Manica and Beira. This
integrated business approach enables the Group to maximise revenues
and margins from the entire value chain.
The Ranches
The beef division has three ranches, namely the 2,350 hectare
Mavonde ranch, the 2,500 hectare Inhazonia ranch (formerly referred
to as the 'Irmaos' ranch) and the 15,000 hectare Dombe ranch, all
located in Central Mozambique. The total herd across the ranches
currently stands at approximately 5,700 head, being a 16% increase
in six months, (31 May 2013: approximately 4,900 head), mainly due
to consistently high pregnancy rates of over 80%, which has yielded
1,595 calves during the current birthing season (to 31 January
2014).
To support growth, an expanded irrigation programme is being
implemented at Mavonde to increase the irrigated land by 195
hectares to 368 hectares, and at Inhazonia, to increase the
irrigated land by 88 hectares to 118 hectares. With full
irrigation, the head to hectare ratio at Mavonde and Inhazonia will
be able to be increased from 1.5 to 7 head per hectare. With this
increased irrigation, we expect that the three ranches will be able
to sustain a total herd of approximately 10,000 head, providing up
to approximately 3,800 animals per year for slaughter.
The Vanduzi Feedlot
The Vanduzi Feedlot (the 'Feedlot') has a 20 pen line with a
potential rolling capacity of approximately 3,000 head every 90
days. In addition to our own animals from the ranches, we currently
purchase cattle from the surrounding areas for fattening in the
Feedlot. We are currently increasing the number of animals in the
Feedlot in order to supply the abattoir with approximately 600
animals per month (from June 2014) to satisfy the current demand
from the retail units and our wholesale operations (refer below).
Based on this number of animals passing through the Feedlot on a
monthly basis, the increase in their weight through the fattening
process, and the related variable and fixed costs of the Feedlot,
this operation is now contributing to the net cash generation of
the beef operations.
In conjunction with the feeding pens, Vanduzi also has 1,050
hectares of land for pasture and production of feed. This helps to
keep feed costs down and maintains an integrated operation.
Furthermore, the feedlot works strategically with other companies
in the Group, for example by using bran, the by-product from the
Grain processing facilities, as a feed supplement for the
cattle.
The Chimoio Abattoir and Retail Units
Since commencing operations in December 2012 slaughter rates at
the abattoir have consistently increased; 2,248 animals were
slaughtered in H1-FY2014, already exceeding the 2,145 animals
slaughtered (or sold live) during FY2013. Our current monthly run
rate is approximately 400 animals, which will increase to 600
animals to satisfy our existing local demand once the Feedlot
operations have ramped up (refer above). At this level of animals
slaughtered per month, the abattoir will recover its operating
costs in full from the sales of skin, offal, hooves and heads (the
'5th quarter') and commence making a net contribution to the cash
generation of the beef operations.
The abattoir has a monthly slaughter capacity of approximately
4,000 head. This spare capacity provides the Group with significant
flexibility to increase slaughter rates as the beef operations
expand.
To capitalise on the value uplift arising on the selling price
of meat (compared to carcasses), the Group has established a branch
of retail units in Chimoio, Tete, Manica and Beira which opened in
December 2012, February 2013, December 2013 and February 2014
respectively. The retail units have performed well for the Group,
underpinned by the strong internal market demand for meat, and are
already contributing a net positive cash flow to the beef
division.
We are particularly excited about the Beira unit - Beira is the
second largest city in Mozambique, and we expect high volumes and
revenues from this site.
Furthermore, in order to capitalise on the Group's ability to
process larger volumes of animals and meat, the Group has now
secured, or is in the process of negotiating, larger volume
wholesale contracts. Contracts already in place provide for monthly
deliveries of approximately 25 tonnes of meat, which we hope to
expand in the short to medium term.
Cocoa Plantation & Trading (Sierra Leone)
The Cocoa division's primary focus is now the development and
expansion of its cocoa plantation, located 40km from Kenema in
south-east Sierra Leone, with the aim of achieving large scale
cocoa production.
250,000 seedlings, cultivated in the existing 1.7 hectare
fully-irrigated nursery at the plantation, were planted on 200
hectares of cleared land in calendar year 2013. We intend to plant
a further 250 hectares by the end of calendar year 2014, with
plants in the nursery already established to support this.
This gradual phasing of the planting schedule, in conjunction
with appropriate agronomical technical expertise, is permitting the
Group to perfect its planting activities. Of significant interest
is likely to be the final assessment of whether part, or all, of
the future planting may now use hybrid plants from the Ivory Coast.
These plants are under technical review but early signs show they
could both increase the average yields to be obtained per hectare
and also accelerate the period to full yield.
Subject to the acquisition of an additional block of 1,600
hectares of land adjacent to the plantation, we plan to plant a
total of 4,000 hectares by 2017, with the ultimate aim of producing
a minimum of 8,000 tonnes of cocoa per annum by 2020/2021.
The construction of administration offices and accommodation at
the plantation has now been finalised (February 2014), and
additional infrastructure development programmes are in place to
further improve the plantation infrastructure and access to Kenema,
including roads and bridges during the rest of the year.
Turning to the established cocoa trading business, we have
streamlined our buying operations which are now conducted from
three main hub stores in Kenema, Kono and Kailahun in the Eastern
Province of Sierra Leone supporting a direct buying register of
more than 3,500 farmers across Sierra Leone. This consolidation
(from three main buying points and around 50 further 'spoke' buying
points in FY2013) has significantly reduced the fixed operating
cost of the trading operation.
The cocoa harvest for the period under review was impacted by a
poor harvest, which resulted in lower available purchase volumes;
325 tonnes of cocoa beans were purchased during the six months
ended 30 November 2013. Nonetheless, within just two months
following the period end (December 2013-January 2014) the Cocoa
division purchased another 325 tonnes of cocoa, enabling the Group
to maintain its market share for the period.
Despite the lower volumes, the streamlining of operations has
reduced the loss from the trading division to US$660,000 for
H1-FY2014 from US$799,000 in H1-FY2013. Subject to an improved
crop, we would expect the trading division to at least break even
in FY2015.
To further support the continued growth of the trading division,
confidential strategic partnerships are being assessed to leverage
combined operational size and cost efficiencies. Further updates
will be provided in due course if and when these partnerships
mature.
The Group remains committed to supporting the sustainable
development of the cocoa industry in Sierra Leone. In line with
this objective, we are now working with the European Commission and
the Republic of Sierra Leone to support its Agriculture For
Development (A4D) scheme, which aims to increase production and
improve the quality of selected cash crops for export, namely
cocoa, coffee and cashew. As part of this programme, we are
implementing training schemes to improve agricultural practices,
such as under-brushing to maintain fertile land, and many of the
Group's farmers have been awarded certification for their
sustainable farming. These improved farming initiatives should help
increase cocoa trading volumes, particularly by rehabilitating and
extending the out-grower areas around the Group's plantation.
Grain Processing & Farming (Mozambique)
The Group's maize operations are focussed on its 35,000 tonne
capacity in Chimoio in central Mozambique, and its 15,000 tonne
capacity facility in Tete, in north-west Mozambique.
Maize and milling operations continue to remain a valuable asset
in the Group's agricultural offering. In order to maximise returns
and profitability in the grain division, our primary focus this
period has been on maximising the price and margins generated from
our maize products. As a result, the grain division's gross profit
has increased to 21.2% from 15.7% in H1-FY2013. This, combined with
other margin, cost and efficiency improvement measures, has
resulted in the Group reporting a profit of US$66,000 for maize
division, compared to a US$385,000 loss for the same period last
year.
The full benefit of this cost streamlining and margin focus has
not yet been felt though, as the operations have been affected by
the recent political difficulties in Mozambique which created
delays in transporting maize products to certain parts of the
country. As a result, approximately 12,000 tonnes of maize products
were sold in the six months ended 30 November 2013 compared to
approximately 30,000 tonnes in H1-FY2013. Revenues accordingly fell
to US$4,376,000 in H1-FY2014 from US$9,045,000 in H1-2014.
These political difficulties are now being resolved and maize
milling volumes are improving, with approximately 16,000 tonnes of
maize products sold in the current financial year between 1 June
2013 and 31 January 2014. Prices have remained in line with
H1-FY2014 and this has helped to recoup part of the shortfall
experienced during the first half of the year.
Maize purchases remained strong in the period, with a marginal
decrease to approximately 31,500 tonnes of maize purchased during
the season of April-November 2013 compared to 34,000 in the
corresponding period of the prior year.
Palm Oil Operations (Sierra Leone)
The Group controls a lease of approximately 45,000 hectares of
brownfield agricultural land suitable for palm oil production in
the Pujehun District in the Southern Province in Sierra Leone. The
Board continues to evaluate this property and its potential for
commercialisation. Further updates will be provided when
appropriate.
For further information please visit www.agriterra-ltd.com or
contact:
Andrew Groves Agriterra Ltd Tel: +44 (0) 20 7408
9200
David Foreman Cantor Fitzgerald Europe Tel: +44 (0) 20 7894
7684
Rick Thompson Cantor Fitzgerald Europe Tel: +44 (0) 20 7894
7684
Andy Cuthill Peat & Co. Tel: +44 (0) 20 3540
1722
John Beaumont Peat & Co. Tel: +44 (0) 20 3540
1723
Susie Geliher St Brides Media & Finance Tel: +44 (0) 20 7236
Ltd 1177
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
6 months 6 months 12 months
ended 30 ended 30 ended 31
November November May
2013 2012 2013
Unaudited Unaudited Audited
Note US$000 US$000 US$000
CONTINUING OPERATIONS
Revenue 7,188 11,486 21,213
Cost of sales (6,378) (9,901) (18,625)
-------------- -------------- --------------
Gross profit 810 1,585 2,588
Increase in value of biological assets 601 77 770
Operating expenses (4,525) (5,707) (10,761)
Other income 229 125 136
Share of result of associates - - (5)
--------------
Operating loss (2,885) (3,920) (7,272)
Net finance income / (expense) 4 820 (231) (646)
-------------- -------------- --------------
Investment revenues 938 5 43
Finance costs (118) (236) (689)
-------------- -------------- --------------
Loss before taxation (2,065) (4,151) (7,918)
Taxation (52) (42) (13)
-------------- -------------- --------------
Loss for the period from continuing
operations 3 (2,117) (4,193) (7,931)
DISCONTINUED OPERATIONS
(Loss) / profit for the period from
discontinued operations 5 (147) 29,364 28,870
(Loss) / profit for the period (2,264) 25,171 20,939
OTHER COMPREHENSIVE LOSS
Foreign currency translation loss on
foreign operations (325) (2,129) (2,492)
TOTAL COMPREHENSIVE (LOSS) / INCOME
FOR THE FINANCIAL PERIOD (2,589) 23,042 18,447
============== ============== ==============
US cents US cents US cents
(LOSS) / EARNINGS PER SHARE
Basic and diluted loss per share from
continuing operations (0.20) (0.40) (0.75)
============== ============== ==============
Basic (loss) / earnings per share from
continuing and discontinued operations (0.21) 2.38 1.98
============== ============== ==============
Diluted (loss) / earnings per share
from continuing and discontinued operations (0.21) 2.38 1.90
============== ============== ==============
No. No. No.
Weighted average number of shares outstanding
for the purposes of calculating basic
(loss) / earnings per share 1,061,818,478 1,059,716,238 1,059,963,899
============== ============== ==============
Weighted average number of shares outstanding
for the purposes of calculating diluted
(loss) / earnings per share from continuing
and discontinued operations 1,061,818,478 1,059,716,238 1,103,411,016
============== ============== ==============
The profit / (loss) and total comprehensive income / (loss) for
all periods presented are wholly attributable to equity holders of
the parent company.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
30 November 30 November 31 May
2013 2012 2013
Unaudited Unaudited Audited
Note US$000 US$000 US$000
Non-current assets
Intangible assets 697 966 697
Property, plant and equipment 35,551 27,381 33,241
Interests in associates 4 9 4
Investments in quoted companies 6 1,091 - 4
Biological assets 3,370 1,491 2,060
------------
40,713 29,847 36,006
------------ ------------ ---------
Current assets
Biological assets 797 963 1,947
Inventories 6,590 5,234 5,456
Trade and other receivables 3,504 45,350 3,378
Cash and cash equivalents 8,739 3,189 18,748
19,630 54,736 29,529
------------ ------------ ---------
Total assets 60,343 84,583 65,535
------------ ------------ ---------
Current liabilities
Borrowings 7 (1,138) (1,853) (3,091)
Trade and other payables (1,711) (18,269) (2,416)
(2,849) (20,122) (5,507)
------------ ------------ ---------
Net current assets 16,781 34,614 24,022
------------ ------------ ---------
Net assets 57,494 64,461 60,028
============ ============ =========
Share capital 8 1,960 1,957 1,960
Share premium 148,622 148,530 148,622
Shares to be issued reserve 2,940 2,940 2,940
Share based payments reserve 1,765 1,643 1,710
Translation reserve (2,521) (1,833) (2,196)
Accumulated losses (95,272) (88,776) (93,008)
------------ ------------ ---------
Equity attributable to equity holders of the parent 57,494 64,461 60,028
============ ============ =========
CONSOLIDATED CASH FLOW STATEMENT
6 months ended 30 6 months ended 30
November November 12 months ended 31 May
2013 2012 2013
Unaudited Unaudited Audited
US$000 US$000 US$000
Loss for before tax for the period from continuing
operations (2,065) (4,151) (7,918)
Adjustments for:
Depreciation 1,117 1,101 2,209
(Profit) / loss on disposal of property, plant
and equipment (180) - 1
Share based payment expense 54 23 90
Foreign exchange gain 12 181 529
Increase in value of biological assets (601) (77) (770)
Finance costs 118 236 689
Investment revenues (938) (5) (43)
Operating cash flows before movements in working
capital (2,483) (2,692) (5,213)
(Increase) / decrease in inventories (1,173) 1,104 917
(Increase) / decrease in trade and other receivables (255) (1,860) 1,104
(Decrease) / increase in trade and other payables (593) 5,430 330
------------------ ------------------ -----------------------
Net cash (used in) / from operating activities by
continuing operations (4,504) 1,982 (2,862)
Corporation tax paid (18) (12) (125)
Finance costs (122) (236) (689)
Interest received 138 5 43
Net cash (used in) / from operating activities by
continuing operations (4,506) 1,739 (3,633)
------------------ ------------------ -----------------------
Net cash used in operating activities by
discontinued operations (147) (56) -
------------------ ------------------ -----------------------
Net cash (used in) / from operating activities (4,653) 1,683 (3,633)
------------------ ------------------ -----------------------
Cash flows from investing activities
Proceeds from disposal of property, plant and
equipment 180 - 14
Acquisition of property, plant and equipment (3,644) (3,559) (10,505)
Purchase of investment in quoted companies (285) - (4)
Decrease /(increase) in biological assets 409 (203) (773)
------------------
Net cash used in investing activities by continuing
operations (3,340) (3,762) (11,268)
------------------ ------------------ -----------------------
Net cash from investing activities in discontinued
operations - - 27,110
------------------ ------------------ -----------------------
Net cash (used in) / from investing activities (3,340) (3,762) 15,842
------------------ ------------------ -----------------------
Cash flow from financing activities
Net (repayment) / draw down of overdraft (442) 1,769 1,468
Draw down of loans - - 6,000
Repayment of loans (1,500) - (4,500)
Net cash (outflow) / inflow from financing
activities from continuing operations (1,942) 1,769 2,968
------------------ ------------------ -----------------------
Net decrease in cash and cash equivalents (9,935) (310) 15,177
Effect of exchange rates on cash and cash
equivalents including discontinued operations (74) (54) 18
------------------ ------------------ -----------------------
Cash and cash equivalents at beginning of period 18,748 3,553 3,553
------------------ ------------------ -----------------------
Cash and cash equivalents at end of period 8,739 3,189 18,748
================== ================== =======================
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Agriterra Limited ('Agriterra' or the 'Company) and its
subsidiaries (together the 'Group') is focussed on the agricultural
sector in Africa. Agriterra is a non-cellular company limited by
shares incorporated and domiciled in Guernsey, Channel Islands. The
address of its registered office is Richmond House, St Julians
Avenue, St Peter Port, Guernsey GY1 1GZ.
The Company's Ordinary Shares are quoted on the AIM Market of
the London Stock Exchange ('AIM').
The unaudited interim consolidated financial statements have
been prepared in US Dollars ('US$' or '$') as this is the currency
of the primary economic environment in which the Group
operates.
The Company's Ordinary Shares are quoted on the AIM Market of
the London Stock Exchange ('AIM').
The unaudited interim consolidated financial statements have
been prepared in US Dollars ('US$' or '$') as this is the currency
of the primary economic environment in which the Group
operates.
2. BASIS OF PREPARATION
The condensed consolidated financial statements of the Group for
the six months ended 30 November 2013 (the 'H1-FY2014 financial
statements'), which are unaudited and have not been reviewed by the
Company's auditor, have been prepared in accordance with the
International Financial Reporting Standards ('IFRS'), as adopted by
the European Union, accounting policies adopted by the Group and
set out in the annual report for the year ended 31 May 2013
(available at www.agriterra-ltd.com). The Group does not anticipate
any significant change in these accounting policies for the year
ended 31 May 2014. References to 'IFRS' hereafter should be
construed as references to IFRSs as adopted by the EU.
This interim report has been prepared to comply with the
requirements of the AIM rules of the London Stock Exchange (the
'AIM Rules'). In preparing this report, the Group has adopted the
guidance in the AIM Rules for interim accounts which do not require
that the interim condensed consolidated financial statements are
prepared in accordance with IAS 34, 'Interim financial reporting'.
While the financial figures included in this report have been
computed in accordance with IFRSs applicable to interim periods,
this report does not contain sufficient information to constitute
an interim financial report as that term is defined in IFRSs.
The financial information contained in this report also does not
constitute statutory accounts under the Companies (Guernsey) Law
2008, as amended. The financial information for the year ended 31
May 2013 is based on the statutory accounts for the period then
ended. The auditors reported on those accounts. Their report was
unqualified and did not include any statements of emphasis of
matter.
The H1-FY2014 financial statements have been prepared in
accordance with the IFRS principles applicable to a going concern,
which contemplate the realisation of assets and liquidation of
liabilities during the normal course of operations. Having carried
out a going concern review in preparing the H1-FY2014 financial
statements, the Directors have concluded that there is a reasonable
basis to adopt the going concern principle.
3. SEGMENT INFORMATION
The Directors consider that the Group's continuing operations
comprise three business segments, grain, beef and cocoa and other
unallocated expenditure. The results of each segment were as
follows:
6 months ended 30 November 2013 - Unaudited
Grain Beef Cocoa Unallocated Total
US$000 US$000 US$000 US$000 US$000
Revenue 4,669 2,068 451 - 7,188
------- ------- ------- ------------ --------
Operating profit / (loss) 66 (990) (659) (1,302) (2,885)
Finance (expense) / income (104) 1 (1) 924 820
------- ------- ------- ------------ --------
Loss before tax (38) (989) (660) (378) (2,065)
Income tax (43) (9) - - (52)
------- ------- ------- ------------ --------
Loss for the period from continuing activities (81) (998) (660) (378) (2,117)
======= ======= ======= ============ ========
6 months ended 30 November 2012 - Unaudited
Grain Beef Cocoa Unallocated Total
US$000 US$000 US$000 US$000 US$000
Revenue 9,045 776 1,665 - 11,486
------- -------- ------- ------------ --------
Operating loss (229) (1,469) (799) (1,423) (3,920)
Finance expense (156) - - (75) (231)
------- -------- ------- ------------ --------
Loss before tax (385) (1,469) (799) (1,498) (4,151)
Income tax (42) - - - (42)
------- -------- ------- ------------ --------
Loss for the period from continuing activities (427) (1,469) (799) (1,498) (4,193)
======= ======== ======= ============ ========
12 months ended 31 May 2013 - Audited
Grain Beef Cocoa Unallocated Total
US$000 US$000 US$000 US$000 US$000
Revenue 15,843 2,230 3,140 - 21,213
------- -------- -------- ------------ --------
Operating loss (108) (2,639) (1,564) (2,961) (7,272)
Finance (expense) / income (335) 2 (5) (308) (646)
------- -------- -------- ------------ --------
Loss before tax (443) (2,637) (1,569) (3,269) (7,918)
Income tax (13) - - - (13)
------- -------- -------- ------------ --------
Loss for the period from continuing activities (456) (2,637) (1,569) (3,269) (7,931)
======= ======== ======== ============ ========
4. NET FINANCE INCOME (EXPENSE)
6 months ended 30 6 months ended 30 November 12 months ended 31 May
November 2012 2013
2013 Unaudited Audited
Unaudited
US$000 US$000 US$000
Interest income on bank deposits 111 5 43
Interest income on loans 25 - -
Fair value gain on financial assets 802 - -
designated at FVTPL (note 6)
Investment revenues 938 5 43
Interest expense on bank borrowings (106) (236) (329)
Interest expense on loan notes (12) - (160)
Facility fees - - (200)
Finance costs (118) (236) (689)
Net finance income / (expense) 820 (231) (646)
================== =========================== =======================
5. DISCONTINUED OPERATIONS
As more fully described in the Group's audited financial
statements for the year ended 31 May 2013, legacy oil and gas
assets are classified as discontinued operations. Certain other
operations of the Group which meet the definition of discontinued
operations under IFRS 5 are also presented as discontinued
operations. Their results of discontinued operations are included
in the income statement as a single line below the loss after
taxation from continuing operations as follows:
6 months ended 30 November 6 months ended 30 12 months ended 31
2013 November May
2012 2013
Unaudited Unaudited Audited
US$000 US$000 US$000
Reversal of impairment of oil and gas
operations - 39,564 40,380
Loss on closure of Zimbabwe and Conakry - - (510)
Other operating expenses (147) - -
(Loss) / profit before taxation (147) 39,564 39,870
Taxation - (10,200) (11,000)
--------------------------- ------------------ -------------------
Profit after taxation (147) 29,364 28,870
=========================== ================== ===================
In the financial year ended 31 May 2013, the Company completed
the disposal of its oil and gas interests in Ethiopia. Further, the
Group closed its maize meal importation business in Zimbabwe and
its port development concession in Conakry. No amounts have been
recognised in respect of these discontinued operations in the six
months ended 30 November 2013.
The Group is engaged in formal arbitration proceedings with the
Government of the Republic of South Sudan and Nile Petroleum
Corporation to recover the compensation assessed by the National
Petroleum Commission as being due to the Company for works
undertaken by the Company and acknowledged as being due by the
Ministry of Petroleum and Mining of the Republic of South Sudan in
April 2012. Expenditure of $147,000 has been incurred in this
matter during the six months ended 30 November 2013. The timing of
receipt of the compensation payment together with the amount to be
received remains uncertain and accordingly the remaining oil and
gas interest remains fully impaired.
6. INVESTMENTS IN QUOTED COMPANIES
'Investments in quoted companies' comprise financial assets
classified as at 'fair value through profit and loss' ('FVTPL').
Changes in market value are recorded in profit and loss within
investment revenues. As at 30 November 2013, these investments
comprise 8,337,682 (30 November 2012: nil; 31 May 2013: 2,500,000)
ordinary shares in African Oilfield Logistics Limited, an AIM
quoted company focussed on the logistics support industry in
respect of oil and gas exploration and other development projects
in sub-Saharan Africa.
Movements in the value of investments in quoted companies were
as follows:
US$000
Market value as at 1 May 2012 and 30 November 2012 - Unaudited -
Purchase of investments at cost 4
-------
Market value as at 31 May 2013 - Audited 4
Purchase of investments at cost 285
Increase in fair value (note 4) 802
-------
Market value as at 30 November 2013 - Unaudited 1,091
=======
7. BORROWINGS
The amount reported as borrowings comprises a revolving
Mozambique Metical credit facility with the Group's Mozambique
bankers of up to approximately $2,000,000 secured upon the Group's
grain inventories in Mozambique.
8. SHARE CAPITAL
Authorised Allotted and fully paid
Number Number US$000
Ordinary shares of 0.1p each
At 31 May 2012 and 30 November 2012 2,345,000,000 1,059,716,238 1,719
Issue of shares - 2,102,240 3
-------------- ---------------- --------
At 31 May 2013 and 30 November 2013 2,345,000,000 1,061,818,478 1,722
Deferred shares of 0.1p each
-------------- ---------------- --------
At 30 November 2012, 31 May 2013 and 30 November 2013 155,000,000 155,000,000 238
-------------- ---------------- --------
Total share capital
-------------- ---------------- --------
At 31 May 2013 and 30 November 2013 2,500,000,000 1,216,818,478 1,960
============== ================ ========
At 30 November 2012 2,500,000,000 1,214,716,238 1,957
============== ================ ========
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR PGUGCPUPCGMA
Agriterra Ld (LSE:AGTA)
Historical Stock Chart
From May 2024 to Jun 2024
Agriterra Ld (LSE:AGTA)
Historical Stock Chart
From Jun 2023 to Jun 2024