Crop and production

RNS Number : 7036M

M. P. Evans Group PLC

16 January 2023

 

M. P. EVANS GROUP PLC

("THE GROUP")
2022 crop and production

M.P. Evans Group PLC, the producer of sustainable Indonesian palm oil, is pleased to announce the following crop and production information for the year ended 31 December 2022:

		2022	Increase	2021
	Tonnes		%	Tonnes
Crop of fresh fruit bunches ("ffb")
Own crops	905,400		12	809,700
Scheme-smallholder crops	265,700		16	229,300
Independent crops purchased	340,600		4	327,200
	1,511,700		11	1,366,200
Production*
Crude palm oil ("CPO")	341,700		9	312,900
Palm kernels ("PK")	73,800		10	67,100

*- figures include production from the Group's crop sold to third-party mills.

Crop and production increased once again in 2022, as the Group's oil-palm estates continue to mature and yields rise, and management in Indonesia strive for operational excellence in both estate and milling operations. Even after another year of increase, further production growth from the Group's existing areas is still to come.

During 2022, the Group achieved an average mill-gate price for its CPO of US$854 per tonne compared with US$810 in the previous year, an increase of 5%. Prices for palm kernels averaged US$611 per tonne (mill gate), 15% higher than the US$533 in 2021. CPO pricing moderated somewhat in the second half of 2022 from the very high levels seen in the first half of the year, and moving into early 2023, the Group has recently achieved mill-gate prices of approximately US$750 per tonne, which remain strong compared to historic levels.

The Group remains committed to the production of certified sustainable palm oil and is close to completing its sixth palm-oil mill at its Musi Rawas project in South Sumatra. This mill will process the increasing amount of crop being harvested from that estate. The Group is also pleased to report that it received total sustainability premia of US$7.5 million related to the sale of its certified sustainable output, 74% higher than the US$4.3 million received in 2021, reflecting in particular a strong increase in premia available for sustainably produced palm kernels.

Over the course of 2022, the Group continued to be strongly cash generative. The remaining net debt at the start of the year of US$5.4 million was eliminated, and even after ongoing capital investment, an increased dividend and restarting the share buyback programme, net cash was over US$30 million by the end of the year. This supports the Group's stated strategy of acquiring additional plantation land. A number of potential acquisitions remain under review.

Considering the reported crop growth, the strong CPO price environment observed in the year, and the ongoing cash generation, the board remains committed to its policy to hold or increase its dividend, under which it has an unbroken track record of more than thirty years.

M.P. Evans executive chairman, Peter Hadsley-Chaplin, commented: "The Group has achieved another significant increase in crop processed which, in conjunction with the high price environment in the year, will form the basis for an excellent result. We anticipate further crop increases from the Group's first-class estates and, with the Musi Rawas mill soon to be commissioned, we look forward to another productive and successful year in 2023."

Enquiries:

M.P. Evans Group PLC

Telephone: [phone]

Peter Hadsley-Chaplin, Chairman
Matthew Coulson, Chief executive
Luke Shaw, Chief financial officer

Peel Hunt LLP (Nomad and joint broker)

Telephone: [phone]

Dan Webster, Andrew Clark, Lalit Bose

finnCap (Joint broker)

Telephone: [phone]

Tim Redfern, Harriet Ward

Hudson Sandler (Financial PR)

Telephone: [phone]

Charlie Jack, Francis Kerrigan, Amelia Craddock

 

END

 

 

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