AGM Statement

RNS Number : 2293I

M. P. Evans Group PLC

10 June 2011

 



M.P. EVANS GROUP PLC

The annual general meeting of M.P. Evans Group PLC ("the Group") is being held in London today.  The following statement, presenting an update on trading conditions and progress on the Group's activities since the publication of the annual report in early May, is being given at the meeting by the chairman, Peter Hadsley-Chaplin:-

1)        Current trading conditions

a)        Palm oil

            2011 has got off to a very good start with robust palm-oil prices and markedly-improved crops.

i)         Prices

            The palm-oil price has hovered around the historically-high level of US$1,200 per tonne so far this year.  Concerns about lower levels of Northern Hemisphere oilseed plantings, the increasing production of biodiesel in Indonesia which is restricting the export of crude and refined palm oil and expected strong demand for vegetable oil by China have all supported the price.

ii)        Crops

            The crops of oil-palm fresh fruit bunches ("f.f.b.") from the majority-owned established Sumatran estates for the five months ended 31 May 2011 amounted to 76,000 tonnes compared with 60,200 tonnes for the same period last year, an increase of 26%. 

            The crops from the two new majority-owned projects, in Kalimantan and on Bangka Island, amounted to 16,200 tonnes, compared with 6,600 tonnes for the same period last year, an increase of 145%.  As referred to in the recently-published annual report, the new projects are in the early stage of their development and are just beginning to produce crops.  Their crops are expected to increase sharply in the forthcoming years.

            The total crops for the Group's majority-owned estates (both established and new) amounted to 92,200 tonnes for the first five months of 2011, which compares with 66,800 tonnes for the same period in 2010.  This represents a 38% increase.

            As previously announced, the Group projects an increase in its production of f.f.b. from its majority-owned estates from the 2010 level of some 200,000 tonnes to approximately 300,000 tonnes in 2012 and 500,000 tonnes in 2015, mostly due to the development and planting of new project areas and without taking account of any further plantings.  These significant increases are likely to impact very positively on the Group's revenues in the near future, and to provide the means to maintain the Group's continuing development programme.

            The crops from the Indonesian associated companies for this period amounted to 149,700 tonnes, a 13% increase over the 132,400 tonnes for the same period last year.

b)        Australian beef cattle

The excellent season has continued on both Woodlands and all the NAPCo properties following the beneficial rainfall earlier in the year.  The number of cattle on Woodlands stands at 11,300 head, compared with 8,000 a year ago.  The NAPCo herd has, within one year, been rebuilt from 160,000 to almost 200,000 head.  Prices for both the lighter-weight cattle, such as those produced by Woodlands, and the heavier, grain-finished cattle, such as those produced by NAPCo, have eased from the recent highs but continue to trade at historically-strong levels.  The recently-announced temporary ban by the Australian government on live cattle exports to Indonesia will not directly affect either NAPCo or Woodlands, neither of which sells its cattle into the live-export market.

2)        New Indonesian oil-palm projects

To date in 2011, a combined area of some 600 hectares (400 for the Group and 200 for the co-operatives) has been planted on the new projects but it is anticipated that the rate of planting will increase during the remainder of the year.

The construction of the palm-oil mill and bulking station on the Kalimantan project is progressing well.  Completion is expected at the end of the year and this will add an important margin to our operations.

In Kalimantan, good progress has been made in the application for the definitive document, the hak guna usaha ("HGU"), which gives the owner the right to use the land for a 30-year period.  Separate HGU's are required for the Group's own land and for the various co-operative schemes' land.  The final process of obtaining the agreement of all parties to the HGU applications has resulted in the Group agreeing to sell some 300 hectares in total of land to two of the co-operatives.  It is hoped that the HGU process will be completed quickly.

3)        Round Table on Sustainable Palm Oil ("RSPO")

            Preparation continues on Pangkatan, Bilah and Sennah Estates for the RSPO audit which is expected to take place in the second half of 2011.  It is hoped that accreditation of the oil from the Pangkatan mill will be granted soon thereafter.

4)        Malaysian property

            The strategy remains to dispose of the remaining Malaysian assets, the 70-hectare Bertam Estate and its 40% share of Bertam Properties Sdn. Berhad, with expected value of approximately US$50 million.  Focus continues to be on expansion in Indonesian palm oil and Australian cattle.

10 June 2011

Enquiries:

M.P. Evans Group PLC	Telephone: [phone]
Peter Hadsley-Chaplin, chairman
Philip Fletcher, managing director
Tristan Price, finance director
Panmure Gordon	Telephone: [phone]
Edward Farmer
Hudson Sandler	Telephone: [phone]
Charlie Jack
Katie Matthew

 

END

 

 

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