Interim Results

Anglo-Eastern Plantations PLC 11 September 2003 ANGLO-EASTERN PLANTATIONS PLC - INTERIM ANNOUNCEMENT • Anglo-Eastern Plantations, which owns approximately 24,000ha of oil palm plantations, primarily in Indonesia, announces that the strong performance of the second half of 2002 continued into the first half of 2003, whose pre-tax profits (in sterling) were double those of the first half of 2002. 2003 2002 Change Turnover (£000) 12,665 6,113 +107% Operating profit (£000) 4,601 2,267 +103% Pre-tax profit (£000) 4,441 2,181 +104% Basic earnings per share (p) 6.2 2.8 +121% Net assets per share (p) 132 139 -5% • The profit increase reflects increases in both average CPO (crude palm oil) prices to $420 from $360 in the first half of 2002 and FFB (fresh fruit bunches) crops, which were some 35% better than in the first half of 2002. • Net debt at 31 December 2002 of $1.7 million was converted into net cash at 30 June 2003 of $0.2 million. • The 5% fall in net assets per share reflects the weakening of sterling to $1.65: £1 from $1.52: £1 at 30 June 2002. In US$ terms, net assets per share increased by 3%. • Work commenced in May on a 20mt/hr oil mill to service our three small estates around Medan in North Sumatra, the rate of new planting in Bengkulu is being accelerated, and the mill in Bengkulu is to be expanded by 20mt/hr early in 2004 - some nine months earlier than orginally scheduled. • Mr T H Chan, Chairman, commented 'Operations in our estates are satisfactory. The new management installed at our Malaysian estates are showing results. However, oil palm crops since June have fallen due to seasonal effects, but we still expect to maintain a substantial improvement in 2003 over 2002. CPO prices have been holding recently around $400/mt. If they continue to hold around that level and barring adverse circumstances, we can expect the current improvement in profits over 2002 to continue.' Enquiries: Anglo-Eastern Plantations plc 020-7236 2838 Rollo Barnes (Financial Director) Bankside Consultants Limited 020-7444 4166 Charles Ponsonby Financial overview The strong performance of the second half of 2002 continued into the first half of 2003. Although the average price of CPO (crude palm oil) was lower than that in the second half of 2002, output of FFB (fresh fruit bunches) was helped by the increasing maturity of our Bengkulu estates in South Sumatra and better yields experienced in our Malaysian estates. Crop output and average prices in the first half of 2003 were substantially higher than the corresponding period in the previous year. As a result, profit before tax for the six months to 30 June 2003 was $7.2 million (£4.4 million) compared to $3.3 million (£2.2 million) for the same period in 2002. Turnover was $20.4 million (£12.7 million) compared to $10.8 million (£6.1 million) for the same period in 2002. The results reflect FFB crops some 35% better than in the same period in 2002, together with satisfactory prices for palm oil as well as for rubber and cocoa. Earnings per share for the six months were 10.0 cts (6.2p) compared to 4.1 cts (2.8p) for the same period in 2002. As in previous years, no interim dividend is being declared. Borrowings net of cash reduced from $1.7 million at 31 December 2002 to a cash net surplus of $0.2 million at 30 June 2003. While cash generation from operations has been strong, there were heavy tax payments in respect of 2002 profits together with loan repayments of $1.0 million and a dividend double that paid in 2002. Production and sales 2003 2002 2002 6 months 6 months year to to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) mt mt mt Oil palm production FFB - own estates 171,491 126,823 294,062 - bought in or processed for third 66,978 36,994 99,029 parties Saleable CPO 40,147 24,363 63,240 Oil palm sales CPO 37,923 21,550 63,042 FFB sold outside 44,606 50,277 93,929 Other crops production Rubber 737 653 1,491 Cocoa 80 71 193 Of the increase of 44,668 mt in total FFB production, 18,842 mt (+21%) came from the North Sumatra estates, 21,860 mt (+90%) from Bengkulu and 3,966 mt (+30%) from Cenderung in Malaysia. These results are all ahead of expectations and it is particularly pleasing that this was the case in Cenderung, where previously we have repeatedly reported weak performance. As mentioned in the last annual report, buying outside crop in the Tasik region of North Sumatra has become more competitive and the total increase of 29.984 mt masks a fall of 4,005 mt for the Tasik mill. However, supplies in Bengkulu continue to be reasonably plentiful and the total of 39,035 mt for the six months compares with 27,452 mt in the second half of 2002. Prices While CPO prices for January and February averaged $450, they then fell to about $415 by the end of June, averaging about $ 420 for the six months period. This compares with an average of $360 for the first half of 2002 and $400 for 2002 as a whole. Cocoa and rubber prices have been strong, averaging 13% and 24% better than for 2002 as a whole. Development The group's planted areas at 30 June 2003 comprise: Mature Immature Total ha ha ha North Sumatra 9,910 438 10,348 Bengkulu 8,720 1,109 9,829 ---------------- --------------- ----------- 18,630 1,547 20,177 Malaysia 3,267 549 3,816 ---------------- --------------- ----------- Total: 30 June 2003 21,897 2,096 23,993 ---------------- --------------- ----------- Total: 31 December 20,375 3,498 23,873 2002 ---------------- --------------- ----------- We have decided to accelerate the rate of new planting in Bengkulu and aim to complete 1,000 ha during 2003, leaving plantable reseves of about 5,000ha. By June, preparation of about 500 ha was in hand but not finally planted and therefore the table above shows only a small increase of 120 ha in planted area. Work commenced in May on a 20 mt/hr oil mill to service our three small estates around Medan in North Sumatra. Completion is expected in the second half of 2004. Cost is expected to be about $2.7 million. In view of the availability of outside crop and the improving performance of the Bengkulu estates, we now plan to begin expanding the mill there early in 2004 to 80mt/hr capacity from 40mt/hr- some nine months earlier than originally scheduled at an expected cost of $2.6 million. Outlook Operations in our estates are satisfactory. The new management installed at our Malaysian estates is showing results. However, oil palm crops since June have fallen due to seasonal effects, but we still expect to maintain the substantial improvement in 2003 over 2002. CPO prices have been holding recently around $400/mt. If they continue to hold around that level and barring adverse circumstances, we can expect the current improvement in profits over 2002 to continue. Chan Teik Huat Chairman and Chief Executive 11 September 2003 CONSOLIDATED PROFIT AND LOSS ACCOUNT US DOLLARS STERLING 2003 2002 2002 2003 2002 2002 6 mnths 6 mnths year to 6 mnths 6 mnths year to to 30 June to 30 June 31 Dec to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited) Note $'000 $'000 $'000 £'000 £'000 £'000 Turnover 20,390 10,784 31,139 12,665 6,113 20,622 Profit before exchange and revaluation provisions 7,423 3,302 11,939 4,610 2,277 9,003 Exchange (losses)/ 1 (15) (15) 828 (9) (10) (548) profits -------- -------- -------- --------- --------- -------- Operating profit 7,408 3,287 12,767 4,601 2,267 8,455 Interest - receivable 60 16 50 37 11 33 - payable (385) (303) (945) (239) (209) (626) - capitalised 67 162 220 42 112 146 -------- -------- -------- --------- --------- -------- Profit before taxation 7,150 3,162 12,092 4,441 2,181 8,008 Taxation Foreign corporation (2,389) (1,122) (4,170) (1,484) (774) (2,762) tax Foreign withholding (144) (145) (372) (89) (100) (246) tax Deferred tax 127 48 175 79 33 116 adjustment -------- -------- -------- --------- --------- -------- Profit after taxation 4,744 1,943 7,725 2,947 1,340 5,116 Minority interests (all equity interests) (825) (327) (1,250) (513) (226) (828) -------- -------- -------- --------- --------- -------- Profit attributable to shareholders 3,919 1,616 6,475 2,434 1,114 4,288 Dividend - - (1,571) - - (1,040) -------- -------- -------- --------- --------- -------- 3,919 1,616 4,904 2,434 1,114 3,248 ======== ======== ======== ========= ========= ======== Earnings per share - basic 10.0cts 4.1cts 16.5cts 6.2p 2.8p 10.9p - diluted 9.9cts 4.1cts 16.4cts 6.1p 2.8p 10.9p Dividend per share 5 - - 4.0cts - - 2.58p Av. shares in issue 39,347 39,227 39,227 39,347 39,227 39,227 ('000) NOTES 1. At 30 June 2003, there was an exchange translation surplus of $199,000 (30 June 2002: $900,000)arising on third party US dollar borrowings by two Indonesian subsidiaries net of cash balances. In view of the unpredictability of the rupiah/dollar exchange rate, this has been held in exchange reserves at 30 June 2003 pending determination of the final profit or loss at 31 December 2003. 2. The unaudited accounts for the six months ended 30 June 2003 were approved by the board of directors on 10 September 2003 and have been prepared in accordance with applicable Accounting Standards in the United Kingdom. The accounting principles applied, including the valuation of fixed assets, are those set out in the annual report for the year ended 31 December 2002 together with any subsequent requirements thereafter. 3. The results for the year ended 31 December 2002 are extracted from the group's full statutory accounts for that year. 4. The financial information in this statement does not constitute full statutory accounts within the meaning of Section 240 of the Companies Act 1985. Full statutory accounts for the year ended 31 December 2002 incorporating an unqualified auditors' report have been delivered to the Registrar of Companies. 5. The final and only dividend in respect of 2002 was paid on 18 June 2003. 6. Copies of the interim statement of results are available from the company's registered office at 6/7 Queen Street, London EC4N 1SP. CONSOLIDATED BALANCE SHEET US DOLLARS STERLING 2003 2002 2002 2003 2002 2002 6 months 6 months year to 6 months 6 months year to to 30 June to 30 June 31 Dec to 30 June to 30 June 31 Dec Notes (unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited) $'000 $'000 $'000 £'000 £'000 £'000 Fixed assets Tangible assets 105,917 107,797 103,558 64,192 70,719 64,322 -------- --------- -------- --------- --------- -------- Current assets Stocks 1,526 1,296 928 925 850 576 Debtors 3,965 3,408 2,001 2,403 2,236 1,243 Investments 290 293 234 176 192 145 Cash at bank and 9,268 1,793 8,416 5,617 1,176 5,227 in hand -------- --------- -------- --------- --------- -------- 15,049 6,790 11,579 9,121 4,454 7,191 -------- --------- -------- --------- --------- -------- Current liabilities Creditors: falling due within one year Borrowings 7 (2,041) (1,378) (2,040) (1,237) (904) (1,267) Other creditors (8,592) (6,136) (7,717) (5,207) (4,025) (4,793) -------- --------- -------- --------- --------- -------- (10,633) (7,514) 9,757 (6,444) (4,929) (6,060) -------- --------- -------- --------- --------- -------- Net current assets/ (liabilities) 4,416 (724) 1,822 2,677 (475) 1,131 -------- --------- -------- --------- --------- -------- Total assets less current liabilities 110,333 107,073 105,380 66,869 70,244 65,453 Non-current assets/ liabilities Creditors: falling due after more than one year Borrowings (7,073) (6,196) (8,085) (4,286) (4,065) (5,022) Deferred 1,442 1,115 1,215 873 731 755 taxation -------- --------- -------- --------- --------- -------- Net assets 104,702 101,992 98,510 63,456 66,910 61,186 ======== ========= ======== ========= ========= ======== Capital and reserves Called-up share 15,249 15,171 15,171 9,856 9,808 9,808 capital Share premium 23,610 23,570 23,570 15,353 15,329 15,329 account Share capital 1,087 1,087 1,087 663 663 663 redemption reserve Revaluation and exchange reserve 7,381 11,990 6,586 2,811 8,194 3,028 Profit and loss 38,638 31,431 34,719 23,417 20,620 21,565 account -------- --------- -------- --------- --------- -------- Shareholders' funds - all equity interests 85,965 83,249 81,133 52,100 54,614 50,393 -------- --------- -------- --------- --------- -------- Minority interests - all equity interests 18,737 18,743 17,377 11,356 12,296 10,793 -------- --------- -------- --------- --------- -------- Total capital 104,702 101,992 98,510 63,456 66,910 61,186 employed ======== ========= ======== ========= ========= ======== Notes 7. (2,020) (1,180) (2,020) (1,224) (774) (1,255) Element of borrowings falling due within one year which relate to repayment of long term loan 8. Shares in 39,419 39,227 39,227 39,419 39,227 39,227 issue ('000) 9. Asset value 218cts 212cts 207cts 132p 139p 128p per share ======== ========= ======== ========= ========= ======== CONSOLIDATED CASH FLOW STATEMENT US DOLLARS STERLING 2003 2002 2002 2003 2002 2002 6 months 6 months year to 6 months 6 months year to to 30 June to 30 June 31 Dec to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited) $'000 $'000 $'000 £'000 £'000 £'000 -------- --------- -------- --------- --------- -------- Net cash inflow from operating activities 9,299 5,183 13,691 5,637 3,529 8,670 -------- --------- -------- --------- --------- -------- Returns on investments and servicing of finance 60 16 50 37 11 33 Interest received Interest (385) (303) (942) (239) (209) (624) paid Interest element of finance lease payments - - (3) - - (2) -------- --------- -------- --------- --------- -------- Dividends paid to minority shareholders - - (263) - - (174) -------- --------- -------- --------- --------- -------- (325) (287) (1,158) (202) (198) (767) -------- --------- -------- --------- --------- -------- Taxation Foreign tax (3,173) (1,856) (2,424) (1,971) (1,280) (1,605) paid UK tax paid (7) (6) - (4) (4) - -------- --------- -------- --------- --------- -------- (3,180) (1,862) (2,424) (1,975) (1,284) (1,605) -------- --------- -------- --------- --------- -------- Capital expenditure Payment to acquire tangible fixed assets (2,496) (3,735) (6,136) (1,550) (2,575) (4,064) Payments to - - (620) - - (411) acquire land Proceeds from sale of tangible fixed assets 18 16 34 11 11 23 -------- --------- -------- --------- --------- -------- (2,478) (3,719) (6,722) (1,539) (2,564) (4,452) -------- --------- -------- --------- --------- -------- Equity dividends paid Parent (1,571) (785) (785) (976) (541) (520) company -------- --------- -------- --- --------- --------- -------- Cash inflow/ (outflow) before financing 1,745 (1,470) 2,602 945 (1,058) 1,326 -------- --------- -------- --------- --------- -------- Financing Employee share 118 - - 73 - - option subscription (Repayment)/ drawdown of long term loans (1,011) 916 3,663 (628) 632 2,427 Finance lease (14) - (29) (9) - (19) repayments -------- --------- -------- --------- --------- -------- (907) 916 3,634 (564) 632 2,408 -------- --------- -------- --------- --------- -------- Increase/ (decrease) in cash and cash equivalents 838 (554) 6,236 381 (426) 3,734 ======== ========= ======== ========= ========= ======== Cash in hand and at bank less short term borrowings Opening 8,416 2,149 2,180 5,227 1,493 1,493 Closing 9,254 1,595 8,416 5,608 1,067 5,227 -------- --------- -------- --------- --------- -------- Net inflow/ 838 (554) 6,236 381 (426) 3,734 (outflow) ======== ========= ======== ========= ========= ======== RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES US DOLLARS 2003 2002 2002 6 months 6 months year to to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) $'000 $'000 $'000 Operating profit 7,408 3,287 12,767 Depreciation and 1,293 1,311 2,411 amortisation (Profit)/loss on sale of (12) (9) 5 fixed assets Movement in market value of (56) (27) 32 investments (Increase) in stocks (599) (696) (328) (Increase) in debtors (287) (267) (263) Increase/(decrease) in 1,417 1,025 (815) creditors Foreign exchange 135 559 (118) ------------- --------- -------- Net cash flow from operating 9,299 5,183 13,691 activities ============= ========= ======== STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES US DOLLARS 2003 2002 2002 6 months 6 months year to to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) $'000 $'000 $'000 Profit for the period 3,919 1,616 6,475 Unrealised (deficit) on (4,568) (11,845) (15,375) revaluation of the estates Profit on exchange 5,363 12,849 10,975 ------------ ---------- -------- Total recognised gains 4,714 2,620 2,075 ============ ========= ======== RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS US DOLLARS 2003 2002 2002 6 months 6 months year to to 30 June to 30 June 31 Dec (unaudited) (unaudited) (audited) $'000 $'000 $'000 Total recognised gains 4,714 2,620 2,075 Dividend - - (1,571) Issue of shares on exercise 118 - - of employee options -------------- --------- -------- Net increase in shareholders' 4,832 2,620 504 funds -------------- --------- -------- Beginning of period 81,133 80,629 80,629 -------------- --------- -------- End of period 85,965 83,249 81,133 ============== ========= ======== This information is provided by RNS The company news service from the London Stock Exchange

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