Interim Results

R.E.A.Hldgs PLC
11 September 2003


•INTERIM STATEMENT•

Crops for the six months to 30 June 2003 showed a useful increase over the
corresponding period of the preceding year with a harvest of oil palm fresh
fruit bunches of 96,500 tonnes against 86,400 tonnes. However, the extent of the
increase was a little disappointing as it had been hoped at the start of the
year that the increase would have been more. That it was not must be attributed
to the unusually extended dry season in East Kalimantan during 2002. Current
reports from the group's estates indicate that, with the 2003 dry season now
ended, crops are picking up sharply. The directors are therefore optimistic that
crops for the second half of 2003 will be in line with expectations. Moreover,
given that the 2003 dry season has been of normal duration, the directors would
not expect 2004 crops to be affected by moisture deficits in the way that crops
for the first half of 2003 have obviously been.


The crude palm oil ('CPO') extraction rate achieved by the group has been
maintained at just under 25 per cent, a very high level by industry standards.
The palm kernel extraction rate was some 4.4 per cent which, although not
abnormal in industry terms is a figure that should be capable of improvement.
The total CPO and palm kernel outputs for the six months to 30 June 2002 were,
respectively, 24,000 tonnes and 4,300 tonnes as compared with 21,600 tonnes and
3,900 tonnes in the six months to 30 June 2001.


The period saw a further firming of the Indonesian rupiah from a level, at the
beginning of 2003, of about Rp 9,000 = US$1 to a level by end June 2003 of Rp
8,300 = US$1. This had the effect of increasing local costs in US dollar terms
but this negative was substantially offset by production efficiencies.
Accordingly, in US dollar terms, there was little overall change in costs during
the six month period. With the CPO price comfortably ahead of $400 per tonne
(CIF Rotterdam) throughout the six months, the result was an acceptable level of
profitability for the production levels currently being achieved by the group.


Work on installing a second production line in the existing oil mill is making
excellent progress. Whilst some elements of the extension work (principally the
installation of a second boiler) will not be wholly finished until later this
year, sufficient of the work has been completed to provide the capacity needed
to process the peak crops of the remaining months of 2003. In line with
previously announced plans for a resumed extension planting programme, nurseries
have already been established and clearing is well advanced as respects the
first 3,000 has of this programme (which envisages a planting rate of 3,000 has
per annum).


Efforts to complete rescheduling of the indebtedness of the company's Indonesian
subsidiary, PT REA Kaltim Plantations ('REA Kaltim') continue. The process is
steadily moving forward and the directors are hopeful that it can be
satisfactorily completed by year end. There have been no new developments in
relation to the US litigation pending against the company.


A memorandum of understanding has recently been signed between the group and a
local Indonesian investor for the establishment of a joint venture oil palm
development (to be owned 95 per cent by the group and 5 per cent by the local
investor) on an area of about 6,500 hectares adjacent to the area of the REA
Kaltim property that lies to the south of the Belayan river. This development
will be an important addition for the group as it will ultimately permit the
capacity of the existing oil mill to be fully utilised without the requirement
to transfer FFB by ferry from areas of the REA Kaltim property lying to the
north of the Belayan. If finance permits, it is hoped to develop the new joint
venture area over a period of about four years. Such development would be in
addition to the already planned 3,000 hectares per annum extension of the REA
Kaltim property and would thus materially enhance the group's planned growth.


Provided that CPO prices do not fall materially from current levels (and the
recent performance of the CPO market encourages the hope that they will not),
the directors expect that the group will make further progress during the second
half of 2002. On that basis and provided that the REA Kaltim debt rescheduling
discussions continue to proceed in the manner anticipated, the directors remain
hopeful that the company will be able to resume payment of dividends on the
preference shares on 31 December 2003 with a dividend on that date equal to the
semi-annual dividend then falling due.


Looking beyond the current year, the directors remain confident of their
previously expressed view that palm product output from the existing planted
areas will progressively grow to a level of in excess of 100,000 tonnes per
annum by around 2006. Thereafter, further substantial growth can be expected as
areas planted under the further extension programme already in hand and under
the new joint venture now being established progressively come to maturity.


                                                                     R M ROBINOW
                                                                        Chairman

                                                               11 September 2003


•CONSOLIDATED PROFIT AND LOSS ACCOUNT•

                                        6 months to   6 months to       Year to
                                            30 June       30 June   31 December
                                               2003          2002          2002
                                               £000          £000          £000

Turnover - Continuing                         6,169         5,246        12,831
Cost of sales                                (3,677)       (3,923)       (7,897)
                                           --------       -------     ---------
Gross profit                                  2,492         1,323         4,934

Other operating income and expenses          (1,243)         (893)       (2,571)
                                           --------       -------     ---------
Group operating profit                        1,249           430         2,363

Disposal of assets & investments
 - continuing                                     -            (3)           (6)
 - discontinued                                   -             -          (320)
Interest receivable and similar income           63           114            88
Interest payable - group                       (557)         (917)         (669)
                                           --------       -------     ---------
Profit/(loss) on ordinary activities
  before taxation                               755          (376)        1,456

Tax on profit/(loss) on ordinary activities    (205)          (20)          (49)
                                           --------       -------     ---------
Profit/(loss) on ordinary activities
  after taxation                                550          (396)        1,407

Minority interests (including 
  non-equity interests)                        (233)           30          (725)
                                           --------       -------     ---------
Profit/(loss) for the period                    317          (366)          682

Non-equity dividends                           (256)         (257)         (512)
                                           --------       -------     ---------
Retained profit/(loss) for the period            61          (623)          170
                                           --------       -------     ---------

Earnings per ordinary share
- basic                                         0.4p         (5.0)p         1.4p
- fully diluted                                 0.4p         (4.3)p         1.3p


•CONSOLIDATED BALANCE SHEET•
                                            30 June       30 June   31 December
                                               2003          2002          2002
                                               £000          £000          £000
Fixed assets
Tangible fixed assets                        49,723        47,720        49,603
Investments                                       -           507             -
                                           --------       -------     ---------
                                             49,723        48,227        49,603
                                           --------       -------     ---------

Current assets  
Stocks                                          984         1,722           857
Debtors                                       3,702         2,415         4,544
Cash                                          7,015         4,236         5,156
                                           --------       -------     ---------
                                             11,701         8,373        10,557
                                           --------       -------     ---------

Creditors up to one year
Borrowings                                   (8,375)      (28,405)       (8,565)
Creditors                                    (4,535)       (6,315)       (5,200)
                                           --------       -------     ---------
                                            (12,910)      (34,720)      (13,765)
                                           --------       -------     ---------

Net current assets                           (1,209)      (26,347)       (3,208)
                                           --------       -------     ---------

Total assets less current liabilities        48,514        21,880        46,395

Creditors over one year
Convertible debt                             (3,448)       (3,528)       (3,419)
Borrowings                                  (19,882)       (2,113)      (21,084)
Creditors                                      (185)          (12)          (50)
                                           --------       -------     ---------
Net assets                                   24,999        16,227        21,842
                                           --------       -------     ---------

Capital and reserves
Called up share capital                      10,042         8,887         8,887
Share premium account                         3,172         1,238         1,233
Capital redemption reserve                    3,240         3,240         3,240
Warrants                                      1,218         1,218         1,218
Revaluation reserve                            (945)       (3,734)         (532)
Other reserve                                 1,024           512           768
Profit and loss account                       2,515         1,587         2,454
                                           --------       -------     ---------
Shareholders' funds*                         20,266        12,948        17,268
Minority interests**                          4,733         3,279         4,574
                                           --------       -------     ---------
                                             24,999        16,227        21,842
                                           --------       -------     ---------

* Shareholders' funds comprise equity interests of £14,561,000 (30 June 2002
£6,971,000; 31 December 2002 £11,563,000) and non-equity interests of £5,705,000
(30 June 2002 £5,705,000; 31 December 2002 £5,705,000).

**Minority interests comprise equity interest of £2,130,000 (30 June 2002
£563,000; 31 December 2002 £2,010,000) and non-equity interest of £2,603,000 
(30 June 2002 £2,716,000; 31 December 2002 £2,564,000).


•CONSOLIDATED CASH FLOWS•
                                        6 months to   6 months to       Year to
                                            30 June       30 June   31 December
                                               2003          2002          2002
                                               £000          £000          £000

Group operating profit                        1,249           430         2,363
Depreciation and amortisation                 1,057         1,255         1,616
(Increase)/decrease in stocks                   (80)         (418)          350
Decrease/(increase) in debtors                  986           458        (1,513)
(Decrease) in creditors                        (700)          (83)       (1,216)
Exchange gain/(loss)                             17          (845)         (565)
                                            -------       -------     ---------
Net cash inflow from operating activities     2,529           797         1,035
Returns on investments and
  servicing of finance
Interest received                                63           114            88
Interest paid                                  (557)         (917)         (669)
Taxation                                        (36)          (51)         (101)
Capital expenditure and 
  financial investment
Purchase of tangible fixed assets            (2,282)       (1,049)       (2,154)
Sale of tangible fixed assets                     -            14            60
Acquisitions and disposals
Further costs of acquisition of
  shares in subsidiaries                        (75)         (177)         (560)
                                            -------       -------     ---------
Cash (outflow) before management of
  liquid resources and financing               (358)       (1,269)       (2,301)
Management of liquid resources                 (758)          418        (3,315)
Financing
Issue of ordinary shares and expenses         3,094             -             -
Issue of convertible loan stock and expenses      -         3,528         3,419
Other                                          (794)       (3,522)        2,659
                                            -------       -------     ---------
(Decrease)/increase in cash                   1,184          (845)          462
                                            -------       -------     ---------


Reconciliation of movement in
  net cash/(debt)
Increase/(decrease) in cash in period         1,184          (845)          462
Cash flow from debt and leases                  794          (279)       (6,078)
Cash flow from management of 
  liquid resources                              758          (418)        3,315
                                            -------       -------     ---------
                                              2,736        (1,542)       (2,301)
New debt and leases, net                       (128)         (148)          727
Exchange                                        614         1,668         2,929
Net (debt) at beginning of period           (27,912)      (29,267)      (29,267)
                                            -------       -------     ---------
Net (debt) at end of period                 (24,690)      (29,289)      (27,912)
                                            -------       -------     ---------


•NOTES TO THE INTERIM STATEMENT•
                                        6 months to   6 months to       Year to
                                            30 June       30 June   31 December
                                               2003          2002          2002
                                               £000          £000          £000

Profit/(loss) on ordinary activities
  before taxation
(by business class)
Agriculture                                     990          (101)        2,162
Unallocated                                    (235)         (275)         (380)
Disposal of assets and investments                -             -          (326)
                                            -------       -------     ---------
                                                755          (376)        1,456
                                            -------       -------     ---------

Tax on profit/(loss) on ordinary activities
UK Corporation tax                                -             -             -
Foreign taxation                                (25)          (45)          (59)
Adjustments in respect as prior periods           -            25            10
Deferred foreign taxation on origination and
  reversal of timing differences               (180)            -             -
                                            -------       -------     ---------
                                               (205)          (20)          (49)
                                            -------       -------     ---------

Reconciliation of shareholders' funds

Profit/(loss) for financial period              317          (366)          682
Goodwill previously written off                   -             -            50
Dividends                                         -             -             -
Issue of shares                               3,094           135           130
Revaluations and foreign exchange translation  (413)       (1,418)        1,809
                                            -------       -------     ---------
                                              2,998        (1,649)        2,671
Shareholders' funds at beginning of period   17,268        14,597        14,597
                                            -------       -------     ---------
Shareholders' funds at end of period         20,266        12,948        17,268
                                            -------       -------     ---------

Notes:
The interim financial information has not been audited and does not constitute
statutory accounts for the purpose of Section 240 of the Companies Act 1985, but
has been prepared on the basis of the basis of the accounting policies set out 
in the annual accounts as at 31 December 2002 and the balance sheet as at 
30 June 2002 has been restated to accord with those policies.

The figures for the year ended 31 December 2002 are abridged and have been
extracted from the statutory accounts filed with the Registrar of Companies on 
which the auditors issued an unqualified report.



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