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Anglo-Eastern Plant (AEP)

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Thursday 26 August, 2021

Anglo-Eastern Plant

Results for the six months ended 30 June 2021

RNS Number : 8817J
Anglo-Eastern Plantations PLC
26 August 2021
 

Anglo-Eastern Plantations Plc

("AEP", "Group" or "Company")

 

Announcement of interim results for the six months ended 30 June 2021

 

The group, comprising Anglo-Eastern Plantations Plc and its subsidiaries (the "Group"), is a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,000 hectares, has today released its results for the six months ended 30 June 2021.

 

Financial Highlights

 

 

2021
6 months
to 30 June
$m

(unaudited)

 

2020
6 months
to 30 June
$m

(unaudited)

 

2020
12 months
to 31 December
$m

(audited)

Revenue

201.1

 

123.1

 

269.1

Profit / (Loss) before tax

 

 

 

 

 

 - before biological assets ("BA") movement

54.2

 

17.1

 

50.4

 - after BA movement

58.2

 

16.8

 

51.7

 

Basic Earnings per ordinary share ("EPS")

 

 

 

 

 

 - before BA movement

90.27cts

 

26.83cts

 

77.67cts

 - after BA movement

96.79cts

 

26.35cts

 

80.32cts

Total net assets

558.2

 

493.2

 

528.6

 

 

Enquiries:

 

Anglo-Eastern Plantations Plc

 

Dato' John Lim Ewe Chuan 

 +44 (0)20 7216 4621

 

 

Panmure Gordon (UK) Limited

 

Dominic Morley

+44 (0)20 7886 2954

 

 

 

Chairman's Interim Statement

 

As of today, the world continues to struggle with the fallout from the Covid-19 pandemic with worldwide infections exceeding two hundred and twelve million and more than four million reported deaths. While vaccination efforts are picking up in many parts of the world, several countries are battling fresh Covid-19 infections. The emergence of a deadly Delta variant which is more contagious and transmissible has accelerated the pandemic especially in places where the vaccination of the mass population is making slow progress. The resurgence of infection brought renewed and expanded lockdowns in both Malaysia and Indonesia where the Group operates. The Indonesian government recently imposed large-scale movement restrictions to curb a spike in new infections as healthcare services are overwhelmed by increasing number of patients. In Malaysia despite a surge in the number of Covid infections, the lockdown was relaxed to allow interstate travel in certain circumstances and some social and commercial activities. 

 

Our operations in Indonesia located mainly in remote plantations, away from main cities are generally spared from the lockdowns which are concentrated in populated cities and towns where infection rates are high. However, we are certainly not spared as our Indonesian operations recently recorded a spike and doubling of employees who have tested positive for the virus in Bengkulu and Kalimantan regions. We continue to reiterate to our employees to observe established safety protocols. We also encourage our employees to register promptly for the government vaccination programs. There are no reported Covid cases in the Malaysian operation probably due to the small number of employees and its remote location.

 

The interim results for the Group for the six months to 30 June 2021 are as follows:

 

Revenue for the six months to 30 June was $201.1 million, 63% higher than $123.1 million reported for the same period of 2020. The Group's gross profit was $59.8 million compared to $21.8 million for the first six months of 2020. Overall profit before tax after biological assets ("BA") movement for the first half of 2021 increased more than three fold to $58.2 million against $16.8 million for the corresponding period in 2020. The overall profit includes a reversal of impairment loss of $0.1 million for the first half of 2021 compared to an impairment loss of $2.5 million for the first half of 2020. The BA movement adjustment for the first half of 2021 was a credit of $4.0 million against a debit of $0.3 million in the last period. The higher profit was attributed to the higher Crude Palm Oil ("CPO") prices and increased production.

 

Fresh Fruit Bunches ("FFB") production for the first half of 2021 was 15% higher at 586,500mt compared to 511,700mt for the same period last year due to better weather conditions and an increased matured area. Our young palms in North Sumatera and Kalimantan performed exceptionally well contributing to the higher production numbers. Bought-in crops for the first half of 2021 also increased by 37% to 583,400mt from 425,400mt mainly due to the increase of crop purchases in the Bengkulu region.

 

Operational and financial performance

 

For the six months ended 30 June 2021, gross profit margin increased to 29.8% from 17.7% as the Group experienced higher CPO and palm kernel prices.

 

CPO price ex-Rotterdam averaged $1,122/mt for the first six months to 30 June 2021, 73% higher than $648/mt over the same period in 2020. Our Group's average ex-mill price for CPO was higher at $706/mt for the same period (H1 2020: $551/mt). The ex-mill prices are normally at a discount to ex-Rotterdam prices as buyers are required to pay logistic charges and Indonesian CPO tax and levy.

 

Profit after tax for the six months ended 30 June 2021 was $45.9 million, compared to a profit after tax of $12.5 million for the first six months of 2020.

 

The resulting basic earnings per share for the period was 96.79cts (H1 2020: 26.35cts).

 

The Group's balance sheet remains strong. Net assets as at 30 June 2021 were $558.2 million compared to $493.2 million as at 30 June 2020 and $528.6 million as at 31 December 2020. The increase in net assets from the last interim report was attributed to higher profit and lower capital expenditure. The Indonesian Rupiah has depreciated by 3% against the US dollar in the first half of 2021.

 

As at 30 June 2021, the Group had cash and cash equivalents, net of loans and borrowings, of $159.1 million (H1 2020: $88.7 million, 31 December 2020: $115.2 million). The external bank borrowings as at 30 June 2020 of $2.7 million which was part of the first half of $88.7 million as mentioned above were fully repaid in 2020. The Group has no bank borrowing in 2021. 

 

Operating costs

 

Operating costs for the Indonesian operations were higher in the first half of 2021 compared to the same period in 2020 mainly due to the increase in bought-in crops from third parties, higher upkeep of plantations and mills and higher harvesting cost related to the increase in production and the increase in matured area.

 

Production and Sales

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

mt

mt

mt

Oil palm production

 

 

 

FFB

 

 

 

- all estates

586,500

511,700

1,103,100

- bought-in from third parties

583,400

425,400

913,200

Saleable CPO

238,700

189,900

406,100

Saleable palm kernels

57,100

45,300

97,100

 

 

 

 

Oil palm sales

 

 

 

CPO

237,900

195,900

400,400

Palm kernels

55,400

45,200

94,700

FFB sold outside

13,400

19,000

44,300

 

 

 

 

Rubber production

206

215

465

 

The Group's six mills processed a total of 1,156,500mt in FFB for the first half of 2021, a 26% increase compared to 918,100mt for the same period last year. The higher throughput was due to the higher FFB supplied from both our own estates and bought-in crops from third parties as explained earlier.

 

Overall CPO produced for the first half of 2021 was 26% higher at 238,700mt from 189,900mt. The oil extraction rate for the first half of 2021 was 20.6% compared to 20.7% in the same period last year. External crops made up 50% of the crop processed compared to 46% in the first half of 2020, which have historically always had a lower oil content.

 

Commodity prices

 

The CPO price ex-Rotterdam for the first half of 2021 averaged $1,122/mt, 73% higher than last year (H1 2020: $648/mt). The price was volatile for the first half of 2021. It started the year at $1,014/mt, gradually trended upwards to peak in May at $1,345/mt before dropping to a low of $975/mt towards the middle of June, before recovering and closing at $1,050/mt on 30 June 2021. The rally in the first half of 2021 was built upon speculation of unfavourable weather conditions in prime soybean-producing countries which may adversely affect the supply of soybean oil. This has resulted in a positive spill-over effect in the demand for CPO which is the closest substitute for soybean oil.

 

Rubber price averaged $1,734/mt, 48% higher than H1 2020 at $1,174/mt.

 

Development

 

The Group's planted areas at 30 June 2021 comprised:

 

 

Total

Mature

Immature

 

Ha

ha

Ha

North Sumatera

19,113

18,310

803

Bengkulu

16,750

15,725

1,025

Riau

4,873

4,873

-

South Sumatera

6,468

5,742

726

Kalimantan

16,764

14,208

2,556

Bangka

2,519

816

1,703

Plasma

4,191

3,077

1,114

Indonesia

70,678

62,751

7,927

Malaysia

3,453

3,453

-

Total: 30 June 2021

74,131

66,204

7,927

Total: 31 December 2020

73,600

63,414

10,186

Total: 30 June 2020

72,441

64,040

8,401

 

 

The Group's new planting and replanting for the first six months of 2021 totalled 1,025ha compared to 971ha for the same period last year . In addition, Plasma planting for the period was 187ha (H1 2020: 216ha).

 

The Group remains optimistic that it will meet substantially its total planting target of 3,800ha in 2021. The Group's total landholding comprises some 128,000ha, of which the planted area stands at around 74,131ha (H1 2020: 72,441ha) with the balance of estimated plantable land at 17,900ha.

 

The construction of the seventh mill in North Sumatera has been delayed by the frequent lockdowns caused by the pandemic in the country, affecting the deployment of manpower at construction site, as well as fabrication of mechanical works, interruption of supply chain and the transport of building materials. The mill is now likely to be completed at the end of Q2, 2022.

 

Dividend

 

As in previous years, no interim dividend has been declared. A final dividend of 1.0 cents per share in respect of the year ended 31 December 2020 was paid on 16 July 2021.

 

Outlook

India, the world's largest edible oil importer in its effort to tame its domestic inflation has at the end of June 2021 cut its taxes on CPO and other palm oil products for three months while maintaining the existing tax rates on other vegetable oils. This is likely to lead to a bigger import and improved demand at the expense of other vegetable oils.

 

The industry also welcomed the Indonesian government decision to reduce the CPO export levy at the start of the second half of 2021. Export levy is payable on a gradual basis starting at $55/mt when CPO price reaches $670/mt. The previous maximum export levy was $255/mt when CPO price exceeds $995/mt. The revised maximum export levy is $175/mt when CPO price exceeds $1000/mt.

 

On the whole CPO prices are expected to moderate in the second half of 2021 as the industry enters into the high production season and palm oil inventory inches higher over the next few months. Prices nevertheless are expected to remain volatile depending on how production levels unfold amidst a change in global weather pattern. 

 

Despite the increase in the vaccination rate, there are rising concerns over the emergence of a new virus variant which has already spread to Indonesia and could interrupt our operations or in a worst case scenario shutdown our estates and mill operations. A prolonged pandemic in our main export markets may also hurt demand in the short term. The Group has policies in place and would be in a good position to mitigate these risks should they arise to limit the impact to the Group.

 

Principal risks and uncertainties

 

The principal risks and uncertainties, including the risks due to the Coronavirus pandemic, have broadly remained the same since the publication of the annual report for the year ended 31 December 2020.

 

A more detailed explanation of the risks relevant to the Group is on pages 34 to 39 and from pages 114 to 119 of the 2020 annual report which is available at https:// www.angloeastern.co.uk /.

 

 

 

Madam Lim Siew Kim

Chairman

26 August 2021

 

 

 

 

 

Responsibility Statements

 

We confirm that to the best of our knowledge:

 

a)  The unaudited interim financial statements have been prepared in accordance with International Accounting Standards ("IAS") 34: Interim Financial Reporting as adopted by the European Union;

 

b)  The Chairman's interim statement includes a fair review of the information required by Disclosure and Transparency Rule ("DTR") 4.2.7R (an indication of important events during the first six months and a description of the principal risks and uncertainties for the remaining six months of the year); and

 

c)  The interim financial statements include a fair review of the information required by DTR 4.2.8R (material related party transactions in the six months ended 30 June 2021 and any material changes in the related party transactions described in the last Annual Report) of the DTR of the United Kingdom Financial Conduct Authority.

 

 

 

By order of the Board

Dato' John Lim Ewe Chuan

Executive Director, Corporate Finance and Corporate Affairs

26 August 2021

 

Condensed Consolidated Income Statement

 

 

2021

6 months to 30 June

(unaudited)

 

2020

6 months to 30 June

(unaudited)

 

2020

Year to 31 December

(audited)

 

 

Continuing operations

 

Notes

 

Result before BA movement*
$000

BA movement
$000

Total
$000

Result

before BA movement
$000

BA movement
$000

Total
$000

Result

before BA movement
$000

BA movement
$000

Total
$000

Revenue

3

201,105

-

201,105

123,098

-

123,098

269,060

-

269,060

Cost of sales

 

(145,214)

3,951

(141,263)

(100,989)

(298)

(101,287)

(213,370)

1,274

(212,096)

Gross profit

 

55,891

3,951

59,842

22,109

(298)

21,811

55,690

1,274

56,964

Administration expenses

 

(3,334)

-

(3,334)

(3,336)

-

(3,336)

(8,134)

-

(8,134)

Reversal of impairment / (Impairment losses)

 

54

-

54

(2,491)

-

(2,491)

2,008

-

2,008

Provision for expected credit loss

 

-

-

-

(313)

-

(313)

(1,485)

-

(1,485)

Operating profit / (loss)

 

52,611

3,951

56,562

15,969

(298)

15,671

48,079

1,274

49,353

Exchange (losses) / gains

 

300

-

300

(11)

-

(11)

(268)

-

(268)

Finance income

4

1,333

-

1,333

1,376

-

1,376

2,876

-

2,876

Finance expense

4

(12)

-

(12)

(236)

-

(236)

(292)

-

(292)

Profit / (Loss) before tax

5

54,232

3,951

58,183

17,098

(298)

16,800

50,395

1,274

51,669

Tax expense

6

(11,441)

(873)

(12,314)

(4,415)

75

(4,340)

(13,660)

(66)

(13,726)

Profit / (Loss) for the period

 

42,791

3,078

45,869

12,683

(223)

12,460

36,735

1,208

37,943

Attributable to:

 

 

 

 

 

 

 

 

 

 

-  Owners of the parent

 

35,781

2,581

38,362

10,633

(190)

10,443

30,784

1,051

31,835

-  Non-controlling interests

 

7,010

497

7,507

2,050

(33)

2,017

5,951

157

6,108

 

 

42,791

3,078

45,869

12,683

(223)

12,460

36,735

1,208,

37,943

Earnings per share for profit attributable to the owners of the parent during the period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-  basic

8

 

 

96.79cts

 

 

26.35cts

 

 

80.32cts

 

-  diluted

8

 

 

96.79cts

 

 

26.35cts

 

 

80.32cts

 

                           

* The total column represents the IFRS figures and the result before BA movement is an Alternative Performance Measure ("APM"). We have opted to additionally disclose this APM as the BA movement is considered to be a fair value calculation which does not appropriately represent the Group's result for the year.

 

 

 

Condensed Consolidated Statement of Comprehensive Income

 

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$000

$000

$000

Profit for the period

45,869

12,460

37,943

Other comprehensive expenses:

 

 

 

Items may be reclassified to profit or loss:

 

 

 

Loss on exchange translation of foreign operations

(14,879)

(13,973)

(5,490)

Net other comprehensive expenses may be reclassified to profit or loss

(14,879)

(13,973)

(5,490)

Items not to be reclassified to profit or loss:

 

 

 

Unrealised (loss) / gain on revaluation of leasehold land, net of tax

(1,014)

(932)

1,309

Remeasurement of retirement benefits plan, net of tax

-

-

(649)

Net other comprehensive (expenses) / income not being reclassified to profit or loss

(1,014)

(932)

660

Total other comprehensive expenses for the period, net of tax

(15,893)

(14,905)

(4,830)

Total comprehensive income / (expenses) for the period

29,976

(2,445)

33,113

Attributable to:

 

 

 

-  Owners of the parent

25,492

(1,560)

27,722

-  Non-controlling interests

4,484

(885)

5,391

 

29,976

(2,445)

33,113

 

 

 

Condensed Consolidated Statement of Financial Position

 

 

 

 

 

 

 

2021

2020

2020

 

 

as at 30 June

as at 30 June

as at 31 December

 

 

(unaudited)

(unaudited)

(audited)

 

 

$000

$000

$000

Non-current assets

 

 

 

 

Property, plant and equipment

 

356,170

355,006

365,353

Receivables

 

24,153

17,895

22,236

Deferred tax assets

 

9,317

12,470

8,817

 

 

389,640

385,371

396,406

Current assets

 

 

 

 

Inventories

 

15,038

6,297

12,541

Income tax receivables

 

10,034

14,225

10,071

Other tax receivables

 

34,717

35,803

41,618

Biological assets

 

12,443

7,054

8,783

Trade and other receivables

 

5,492

6,108

4,693

Short-term investments

 

1,539

-

1,957

Cash and cash equivalents

 

159,140

91,442

115,211

 

 

238,403

160,929

194,874

Current liabilities

 

 

 

 

Loans and borrowings

 

-

(2,734)

-

Trade and other payables

 

(27,223)

(17,178)

(26,310)

Income tax liabilities

 

(11,863)

(3,409)

(5,981)

Other tax liabilities

 

(1,258)

(1,089)

Dividend payables

 

(221)

(24)

Lease liabilities

 

(244)

(221)

(236)

 

 

(40,921)

(25,021)

(33,640)

Net current assets

 

197,482

135,908

161,234

Non-current liabilities

 

 

 

 

Deferred tax liabilities

 

(14,659)

(15,984)

(15,467)

Retirement benefits - net liabilities

 

(14,220)

(11,792)

(13,383)

Lease liabilities

 

(90)

(328)

(217)

 

 

(28,969)

(28,104)

(29,067)

Net assets

 

558,153

493,175

528,573

 

 

 

 

 

Issued capital and reserves attributable to owners of the parent

 

 

 

 

Share capital

 

15,504

15,504

15,504

Treasury shares

 

(1,171)

(1,171)

(1,171)

Share premium

 

23,935

23,935

23,935

Capital redemption reserve

 

1,087

1,087

1,087

Revaluation reserves

 

48,465

47,530

49,367

Exchange reserves

 

(245,502)

(240,146)

(233,534)

Retained earnings

 

611,459

552,660

573,493

 

 

453,777

399,399

428,681

Non-controlling interests

 

104,376

93,776

99,892

Total equity

 

558,153

493,175

528,573

 

 

 

Condensed Consolidated Statement of Changes in Equity

 

 

Attributable to owners of the parent

 

 

 


 

 

Share

capital

 

Treasury

shares

 

Share

premium

Capital

redemption

reserve

 

Revaluation

reserves

 

Exchange

Reserves

 

Retained

earnings

 

 

Total

Non-controlling

interests

 

Total

equity

 

 

$000

$000

$000

$000

$000

$000

$000

$000

$000

$000

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 31 December 2019

15,504

(1,171)

23,935

1,087

48,413

(229,026)

542,415

401,157

94,661

495,818

Items of other comprehensive income:

 

 

 

 

 

 

 

 

 

 

-Unrealised gain on revaluation of leasehold land, net of tax

-

-

-

-

954

-

-

954

355

1,309

-Remeasurement of retirement benefits plan, net of tax

-

-

-

-

-

-

(559)

(559)

(90)

(649)

-Loss on exchange translation of foreign operations

-

-

-

-

-

(4,508)

-

(4,508)

(982)

(5,490)

Total other comprehensive income /  (expenses)

-

-

-

-

954

(4,508)

(559)

(4,113)

(717)

(4,830)

Profit for the year

-

-

-

-

-

-

31,835

31,835

6,108

37,943

Total comprehensive income / (expenses) for the year

-

-

-

-

954

(4,508)

31,276

27,722

5,391

33,113

Dividends paid

-

-

-

-

-

-

(198)

(198)

(160)

(358)

Balance at 31 December 2020

15,504

(1,171)

23,935

1,087

49,367

(233,534)

573,493

428,681

99,892

528,573

Items of other comprehensive income:

 

 

 

 

 

 

 

 

 

 

-Unrealised loss on revaluation of leasehold land, net of tax

-

-

-

-

(902)

-

-

(902)

(112)

(1,014)

-Loss on exchange translation of foreign operations

-

-

-

-

-

(11,968)

-

(11,968)

(2,911)

(14,879)

Total other comprehensive expenses

-

-

-

-

(902)

(11,968)

-

(12,870)

(3,023)

(15,893)

Profit for the period

-

-

-

-

-

-

38,362

38,362

7,507

45,869

Total comprehensive (expenses) / income for the period

-

-

 

-

(902)

(11,968)

38,362

25,492

4,484

29,976

Dividends payable

-

-

-

-

-

-

(396)

(396)

-

(396)

Balance at 30 June 2021

15,504

(1,171)

23,935

1,087

48,465

(245,502)

611,459

453,777

104,376

558,153

 

 

 

 

Attributable to owners of the parent

 

 

 


 

 

Share

capital

 

Treasury

shares

 

Share

premium

Capital

redemption

reserve

 

Revaluation

reserves

 

Exchange

reserves

 

Retained

earnings

 

 

Total

Non-controlling

interests

 

Total

Equity

 

$000

$000

$000

$000

$000

$000

$000

$000

$000

$000

 

 

 

 

 

 

 

 

 

 

 

Balance at 31 December 2019

15,504

(1,171)

23,935

1,087

48,413

(229,026)

542,415

401,157

94,661

495,818

Items of other comprehensive income:

 

 

 

 

 

 

 

 

 

 

-Unrealised loss on revaluation of leasehold land, net of tax

-

-

-

-

(883)

-

-

(883)

(49)

(932)

-Loss on exchange translation of foreign operations

-

-

-

-

-

(11,120)

-

(11,120)

(2,853)

(13,973)

Total other comprehensive expenses

-

-

-

-

(883)

(11,120)

-

(12,003)

(2,902)

(14,905)

Profit for the period

-

-

-

-

-

-

10,443

10,443

2,017

12,460

Total comprehensive expenses for the period

-

-

-

-

(883)

(11,120)

10,443

(1,560)

(885)

(2,445)

Dividends payable

-

-

-

-

-

-

(198)

(198)

-

(198)

Balance at 30 June 2020

15,504

(1,171)

23,935

1,087

47,530

(240,146)

552,660

399,399

93,776

493,175

                                       

 

Condensed Consolidated Statement of Cash Flows

 

2021

 

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$000

$000

$000

Cash flows from operating activities

 

 

 

Profit before tax

58,183

16,800

51,669

Adjustments for:

 

 

 

Biological assets movement

(3,951)

298

(1,274)

(Gain) / Loss on disposal of property, plant and equipment

(1)

26

(2)

Depreciation

9,379

8,993

18,143

Retirement benefit provisions

1,357

932

1,793

Net finance income

(1,321)

(1,140)

(2,584)

Unrealised (gain) / loss in foreign exchange

(300)

11

268

Property, plant and equipment written off

139

263

587

(Reversal of impairment) / Impairment losses

(54)

2,491

(2,008)

(Reversal) / Provision for expected credit loss

(1)

313

1,485

Operating cash flows before changes in working capital

63,430

28,987

68,077

(Increase) / Decrease in inventories

(2,835)

2,209

(3,915)

Decrease / (Increase) in non-current, trade and other receivables

1,789

(372)

(12)

Increase in trade and other payables

1,737

1,786

10,554

Cash inflows from operations

64,121

32,610

74,704

Interest paid

-

(217)

(258)

Retirement benefits paid

(141)

(175)

(434)

Overseas tax paid

(1,351)

(6,147)

(8,917)

Net cash flows from operating activities

62,629

26,071

65,095

 

 

 

 

Investing activities

 

 

 

Property, plant and equipment

 

 

 

-  purchases

(12,031)

(11,141)

(21,277)

-  sales

1

50

83

Interest received

1,333

1,376

2,876

Increase in receivables from cooperatives under plasma scheme

(5,197)

(1,792)

(4,563)

Placement of fixed deposits with original maturity of more than three months

418

-

(1,957)

Net cash used in investing activities

(15,476)

(11,507)

(24,838)

 

Financing activities

 

 

 

 

Dividends paid to the holders of the parent

-

-

(197)

Dividends paid to non-controlling interests

-

-

(160)

 

Repayment of existing long-term loans

-

(5,425)

(8,167)

 

Repayment of lease liabilities - principal

(106)

(106)

(223)

 

Repayment of lease liabilities - interest

(12)

(19)

(34)

 

Net cash used in financing activities

(118)

(5,550)

 

Net increase in cash and cash equivalents

47,035

9,014

31,476

 

 

 

 

 

 

Cash and cash equivalents

 

 

 

 

At beginning of period

115,211

84,846

84,846

 

Exchange losses

(3,106)

(2,418)

(1,111)

 

At end of period

159,140

91,442

115,211

 

 

Comprising:

 

 

 

 

Cash at end of period

159,140

91,442

115,211

 

             

 

 

 

Notes to the interim statements

 

1.  Basis of preparation of interim financial statements

 

These interim consolidated financial statements have been prepared in accordance with IAS 34, "Interim Financial Reporting", as adopted by the European Union. They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the 2020 Annual Report. The financial information for the half years ended 30 June 2021 and 30 June 2020 does not constitute statutory accounts within the meaning of Section 434(3) of the Companies Act 2006 and has been neither audited nor reviewed pursuant to guidance issued by the Auditing Practices Board.

 

Basis of preparation

The annual financial statements of Anglo-Eastern Plantations Plc are prepared in accordance with International Financial Reporting Standards ("IFRSs") as adopted by the European Union. The comparative financial information for the year ended 31 December 2020 included within this report does not constitute the full statutory accounts for that period. The statutory Annual Report and Financial Statements for 2020 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Financial Statements for 2020 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

 

The Directors have a reasonable expectation, having made the appropriate enquiries, that the Group has control of the monthly cashflows and that the Group has sufficient cash resources to cover the fixed cashflows for a period of at least 12 months from the date of approval of this interim report. For these reasons, the Directors adopted a going concern basis in the preparation of the interim report. The Directors have made this assessment after consideration of the Group's budgeted cash flows and related assumptions including appropriate stress testing of identified uncertainties, specifically on the potential shut down of the entire operations if all the plantations are infected with Coronavirus as well as the impact on the demand for palm oil due to the Coronavirus pandemic. Stress testing of other identified uncertainties was undertaken on primarily commodity prices and currency exchange rates.

 

Changes in accounting standards

The same accounting policies, presentation and methods of computation are followed in these condensed consolidated financial statements as were applied in the Group's latest annual audited financial statements.

 

In November 2020, the President of Republic of Indonesia enacted a Job Creation Law that will have an impact on employee benefit obligations. As at 31 December 2020, the Group has calculated the employee benefit obligation based on the law that was in effect prior to this Job Creation Law, namely UU No. 13/2003, due to the fact that the basis of the calculation for employee benefit obligations is further regulated in an implementing regulation which was only enacted on 16 February 2021. Until the completion date of this report, the Group is still calculating the impact of the implementation of this regulation, and its effect on the Group's financial statements. 

 

2.  Foreign exchange

 

 

2021

2020

2020

 

 

6 months

6 months

Year

 

 

to 30 June

to 30 June

to 31 December

 

 

(unaudited)

(unaudited)

(audited)

 

 

 

 

 

  Closing exchange rates

 

 

 

 

  Rp : $

 

14,496

14,302

14,105

  $ : £

 

1.38

1.24

1.36

  RM : $

 

4.15

4.28

4.02

 

 

 

 

 

  Average exchange rates

 

 

 

 

  Rp : $

 

14,298

14,600

14,572

  $ : £

 

1.39

1.26

1.28

  RM : $

 

4.10

4.25

4.20

 

3.  Revenue

 

Disaggregation of Revenue

The Group has disaggregated revenue into various categories in the following table which is intended to:

Depict how the nature, amount and uncertainty of revenue and cash flows are affected by timing of revenue recognition; and

Enable users to understand the relationship with revenue segment information provided in note 5.

 

There is no right of return and warranty provided to the customers on the sale of products and services rendered.

 

 

 

6 months to 30 June 2021

CPO, palm kernel and FFB

 

 

Rubber

Shell nut

Biomass products

Biogas products

 

 

Others

Total

 

$000

$000

$000

$000

$000

$000

$000

 

 

 

 

 

 

 

 

Contract counterparties

 

 

 

 

 

 

 

Government

-

-

-

-

423

-

423

Non-government

 - Wholesalers

 

197,552

 

356

 

2,187

 

218

 

-

 

369

 

200,682

 

197,552

356

2,187

218

423

369

201,105

 

 

 

 

 

 

 

 

Timing of transfer of goods

 

 

 

 

 

 

 

Delivery to customer premises

 

2,502

 

356

 

-

 

-

 

-

 

-

 

2,858

Delivery to port of departure

-

-

-

218

-

-

218

Customer collect from our mills / estates

 

195,050

 

-

 

2,187

 

-

 

-

 

-

 

197,237

Upon generation / others

-

-

-

-

423

369

792

 

197,552

356

2,187

218

423

369

201,105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6 months to 30 June 2020

CPO, palm kernel and FFB

 

 

Rubber

Shell nut

Biomass products

Biogas products

 

 

Others

Total

 

$000

$000

$000

$000

$000

$000

$000

 

 

 

 

 

 

 

 

Contract counterparties

 

 

 

 

 

 

 

Government

-

-

-

-

551

-

551

Non-government

- Wholesalers

 

120,002

 

252

 

1,649

 

213

 

-

 

431

 

122,547

 

120,002

252

1,649

213

551

431

123,098

 

 

 

 

 

 

 

 

Timing of transfer of goods

 

 

 

 

 

 

 

Delivery to customer premises

2,073

 

252

 

-

 

-

 

-

 

-

 

2,325

Delivery to port of departure

-

-

-

213

-

-

213

Customer collect from our mills / estates

 

117,929

 

-

 

1,649

 

-

 

-

 

-

 

119,578

Upon generation / others

-

-

-

-

551

431

982

 

120,002

252

1,649

213

551

431

123,098

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to 31 December 2020

CPO, palm kernel and FFB

 

 

Rubber

Shell nut

Biomass products

Biogas products

 

 

Others

Total

 

$000

$000

$000

$000

$000

$000

$000

 

 

 

 

 

 

 

 

Contract counterparties

 

 

 

 

 

 

 

Government

-

-

-

-

970

-

970

Non-government

 - Wholesalers

 

262,348

 

631

 

3,959

 

427

 

-

 

725

 

268,090

 

262,348

631

3,959

427

970

725

269,060

 

 

 

 

 

 

 

 

Timing of transfer of goods

 

 

 

 

 

 

 

Delivery to customer premises

5,613

631

-

-

-

-

6,244

Delivery to port of departure

-

-

-

427

-

-

427

Customer collect from our mills / estates

 

256,735

 

-

 

3,959

 

-

 

-

 

-

 

260,694

Upon generation / others

-

-

-

-

970

725

1,695

 

262,348

631

3,959

427

970

725

269,060

 

4.  Finance income and expense

 

 

2021

2020

2020

 

 

6 months

6 months

Year

 

 

to 30 June

to 30 June

to 31 December

 

 

(unaudited)

(unaudited)

(audited)

 

 

$000

$000

$000

 

 

 

 

 

  Finance income

 

 

 

 

  Interest receivable on:

 

 

 

 

  Credit bank balances and time deposits

 

1,333

1,376

2,876

 

 

 

 

 

  Finance expense

 

 

 

 

  Interest payable on:

 

 

 

 

  Development loans

 

-

(217)

(257)

  Interest expense on lease liabilities

 

(12)

(19)

(35)

 

 

(12)

(236)

(292)

 

 

 

 

 

Net finance income recognized in income statement

 

1,321

1,140

2,584

 

5.  Segment information

 

 

North

Sumatera

Bengkulu

South Sumatera

Riau

Bangka

Kalimantan

Total Indonesia

Malaysia

UK

Total

 

$000

$000

$000

$000

$000

$000

$000

$000

$000

$000

6 months to 30 June 2021 (unaudited)

 

 

 

 

 

 

 

 

 

Total sales revenue (all external)

 

 

 

 

 

 

 

 

 

 

CPO, palm kernel and FFB

57,451

70,051

198

31,239

925

36,442

196,306

1,246

-

197,552

Rubber

356

-

-

-

-

-

356

-

-

356

Shell nut

663

648

-

746

-

130

2,187

-

-

2,187

Biomass products

218

-

-

-

-

-

218

-

-

218

Biogas products

-

220

-

-

-

203

423

-

-

423

Others

45

48

88

21

11

143

356

13

-

369

  Total revenue

58,733

70,967

286

32,006

936

36,918

199,846

1,259

-

201,105

 

 

 

 

 

 

 

 

 

 

 

  Profit / (loss) before tax

16,480

16,640

(2,198)

8,441

131

15,503

54,997

(169)

(596)

54,232

  BA movement

1,550

770

86

206

54

1,132

3,798

153

-

3,951

  Profit / (loss) for the period before tax per consolidated income statement

18,030

17,410

(2,112)

8,647

185

16,635

58,795

(16)

(596)

58,183

 

 

 

 

 

 

 

 

 

 

 

  Interest income

969

297

2

52

-

10

1,330

3

-

1,333

  Interest expense

(9)

-

-

-

-

-

(9)

(3)

-

(12)

  Depreciation

(2,601)

(2,075)

(982)

(452)

(172)

(2,829)

(9,111)

(268)

-

(9,379)

  Reversal of impairment

-

-

-

-

-

133

133

-

-

133

  Impairment losses

-

-

(79)

-

-

-

(79)

-

-

(79)

  (Provision) / Reversal of expected credit loss

-

(1)

1

-

-

(1)

(1)

-

1

-

  Inter-segment transactions

2,549

(1,002)

(378)

(288)

(141)

(968)

(228)

218

10

-

  Inter-segmental revenue

18,561

637

3,140

-

-

4,075

26,413

-

-

26,413

  Tax expense

(4,484)

(3,402)

670

(1,800)

(17)

(3,153)

(12,186)

(127)

(1)

(12,314)

 

 

 

 

 

 

 

 

 

 

 

  Total assets

245,486

124,423

40,142

36,003

16,630

137,654

600,338

20,859

6,846

628,043

  Non-current assets

108,443

68,525

29,375

17,008

14,761

101,808

339,920

16,250

-

356,170

  Non-current assets - additions

2,638

2,285

1,308

391

930

3,949

11,501

370

-

11,871

 

 

 

 

 

 

 

 

 

 

 

 

 

North

Sumatera

Bengkulu

South Sumatera

Riau

Bangka

Kalimantan

Total Indonesia

Malaysia

UK

Total

 

$000

$000

$000

$000

$000

$000

$000

$000

$000

$000

6 months to 30 June 2020 (unaudited)

 

 

 

 

 

 

 

 

 

Total sales revenue (all external)

 

 

 

 

 

 

 

 

 

 

CPO, palm kernel and FFB

36,438

42,582

53

20,307

466

19,014

118,860

1,142

-

120,002

Rubber

252

-

-

-

-

-

252

-

-

252

Shell nut

513

335

-

692

-

109

1,649

-

-

1,649

Biomass products

213

-

-

-

-

-

213

-

-

213

Biogas products

151

219

-

-

-

181

551

-

-

551

Others

46

62

91

21

7

204

431

-

-

431

  Total revenue

37,613

43,198

144

21,020

473

19,508

121,956

1,142

-

123,098

 

 

 

 

 

 

 

 

 

 

 

  Profit / (loss) before tax

6,244

9,000

(3,592)

5,466

(113)

1,098

18,103

(155)

(850)

17,098

  BA movement

302

(123)

(64)

(144)

12

(337)

(354)

56

-

(298)

  Profit / (loss) for the period before tax per consolidated income statement

6,546

8,877

(3,656)

5,322

(101)

761

17,749

(99)

(850)

16,800

 

 

 

 

 

 

 

 

 

 

 

  Interest income

1,028

300

2

14

-

16

1,360

15

1

1,376

  Interest expense

(13)

-

-

-

-

(217)

(230)

(6)

-

(236)

  Depreciation

(2,279)

(2,102)

(1,048)

(436)

(180)

(2,679)

(8,724)

(269)

-

(8,993)

  Impairment losses

-

-

(23)

-

-

(2,468)

(2,491)

-

-

(2,491)

  (Provision) / Reversal of expected credit loss

(58)

-

(255)

-

-

(1)

(314)

-

1

(313)

  Inter-segment transactions

2,546

(981)

(370)

(282)

(97)

(975)

(159)

71

88

-

  Inter-segmental revenue

12,402

653

1,661

-

-

1,394

16,110

-

-

16,110

  Tax expense

(2,501)

(1,887)

1,105

(1,257)

43

184

(4,313)

(29)

2

(4,340)

 

 

 

 

 

 

 

 

 

 

 

  Total assets

208,010

104,609

38,880

30,438

15,069

123,131

520,137

20,077

6,086

546,300

  Non-current assets

110,228

69,317

30,649

17,481

13,529

97,807

339,011

15,995

-

355,006

  Non-current assets - additions

2,610

621

1,173

267

2,048

4,025

10,744

85

-

10,829

 

 

 

 

 

 

 

 

 

 

 

 

 

North

Sumatera

Bengkulu

South Sumatera

Riau

Bangka

Kalimantan

Total Indonesia

Malaysia

UK

Total

 

$000

$000

$000

$000

$000

$000

$000

$000

$000

$000

Year to 31 December 2020 (audited)

 

 

 

 

 

 

 

 

Total sales revenue (all external)

 

 

 

 

 

 

 

 

 

 

CPO, palm kernel and FFB

81,764

85,699

1,561

46,865

1,026

43,103

260,018

2,330

-

262,348

Rubber

631

-

-

-

-

-

631

-

-

631

Shell nut

1,232

956

-

1,586

-

185

3,959

-

-

3,959

Biomass products

427

-

-

-

-

-

427

-

-

427

Biogas products

152

444

-

-

-

374

970

-

-

970

Others

60

105

176

-

16

355

712

6

7

725

  Total revenue

84,266

87,204

1,737

48,451

1,042

44,017

266,717

2,336

7

269,060

 

 

 

 

 

 

 

 

 

 

 

  Profit / (loss) before tax

18,915

16,809

(6,639)

12,341

(76)

11,174

52,524

(682)

(1,447)

50,395

  BA movement

550

130

71

126

36

344

1,257

17

-

1,274

  Profit / (loss) for the year before tax per consolidated income statement

 

19,465

 

16,939

 

(6,568)

 

12,467

 

(40)

 

11,518

 

53,781

 

(665)

 

(1,447)

51,669

 

 

 

 

 

 

 

 

 

 

 

  Interest income

2,121

670

3

34

-

25

2,853

22

1

2,876

  Interest expense

(25)

-

-

-

-

(257)

(282)

(10)

-

(292)

  Depreciation

(4,741)

(4,253)

(2,090)

(886)

(308)

(5,387)

(17,665)

(478)

-

(18,143)

  Reversal of impairment

-

-

31

-

-

2,165

2,196

-

-

2,196

  Impairment losses

-

-

-

-

-

-

-

(188)

-

(188)

  Reversal / (Provision) for expected credit loss

 

65

 

(1)

 

(1,383)

 

-

 

(1)

 

(167)

 

(1,487)

 

1

 

1

(1,485)

  Inter-segment transactions

4,744

(1,966)

(741)

(564)

(195)

(1,913)

(635)

467

168

-

  Inter-segmental revenue

27,668

3,293

3,505

-

-

4,167

38,633

-

-

38,633

  Tax expense

(6,734)

(3,218)

1,361

(2,742)

25

(1,594)

(12,902)

(737)

(87)

(13,726)

 

 

 

 

 

 

 

 

 

 

 

  Total assets

227,471

111,470

39,554

33,572

16,580

134,973

563,620

21,682

5,978

591,280

  Non-current assets

111,483

70,332

30,320

17,543

14,713

104,295

348,686

16,667

-

365,353

  Non-current assets - additions

4,582

2,413

2,319

342

4,474

6,868

20,998

127

-

21,125

 

In the 6 months to 30 June 2021, revenues from 4 customers of the Indonesian segment represent approximately $112.6m (H1 2020: $63.5m) of the Group's total revenues. In the year 2020, revenues from 4 customers of the Indonesian segment represent approximately $130.8m of the Group's total revenues. An analysis of this revenue is provided below. Although Customers 1 and 2 each contribute over 10% of the Group's total revenue, there was no over reliance on these Customers as tenders were performed on a weekly basis. Two of the top four customers were the same as in the year to 31 December 2020.

 

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$m

%

$m

%

$m

%

Major Customers

 

 

 

 

 

 

Customer 1

53.7

26.7

19.5

15.8

53.6

20.0

Customer 2

23.5

11.7

16.0

13.0

31.6

11.7

Customer 3

18.4

9.2

15.1

12.2

25.0

9.3

Customer 4

17.0

8.5

12.9

10.4

20.6

7.6

Total

112.6

56.1

63.5

51.4

130.8

48.6

6.  Tax expense

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$000

$000

$000

 

 

 

 

Foreign corporation tax - current year

13,194

6,036

9,920

Foreign corporation tax - prior year

-

50

287

Deferred tax adjustment - origination and reversal of temporary differences

(880)

(1,746)

 

2,832

Recognition of previously unrecognized deferred tax assets

-

-

 

687

 

12,314

4,340

13,726

 

Corporation tax rate in Indonesia is at 22% (H1 2020: 25%, 2020: 22%) whereas Malaysia is at 24% (H1 2020: 24%, 2020: 24%). The standard rate of corporation tax in the UK for the current year is 19% (H1 2020: 19%, 2020: 19%). 

 

7.  Dividend

 

The final and only dividend in respect of 2020, amounting to 1.0 cents per share, or $396,364 was paid on 16 July 2021 (2019: 0.5 cents per share, or $198,182, paid on 17 July 2020). As in previous years, no interim dividend has been declared.

 

8.  Earnings per ordinary share ("EPS")

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$000

$000

$000

 

 

 

 

Profit for the period attributable to owners of the Company before BA movement

35,781

10,633

30,784

BA movement

2,581

(190)

1,051

Earnings used in basic and diluted EPS

38,362

10,443

31,835

 

 

 

 

 

Number

Number

Number

 

'000

'000

'000

Weighted average number of shares in issue in the period

 

 

 

  -  used in basic EPS

39,636

39,636

39,636

  -  dilutive effect of outstanding share options

-

-

 

-

  -  used in diluted EPS

39,636

39,636

39,636

 

 

 

 

Basic and diluted EPS before BA movement

90.27cts

26.83cts

77.67cts

Basic and diluted EPS after BA movement

96.79cts

26.35cts

80.32cts

 

9.  Fair value measurement of financial instruments

 

The carrying amounts and fair values of the financial instruments which are not recognised at fair value in the Statement of Financial Position are exhibited below:  

 

 

2021

2020

2020

 

 

6 months

6 months

Year

 

 

to 30 June

to 30 June

to 31 December

 

 

(unaudited)

(unaudited)

(audited)

 

 

Carrying amount

Fair value

Carrying amount

Fair value

Carrying amount

Fair value

 

 

$000

$000

$000

$000

$000

$000

 

Non-current receivables

 

 

 

 

 

 

 

Due from non-controlling interests

5,413

3,032

3,487

1,974

5,493

3,050

 

Due from cooperatives under Plasma scheme

18,740

17,061

14,408

13,626

16,743

14,857

 

 

24,153

20,093

17,895

15,600

22,236

17,907

 

 

 

 

 

 

 

 

                 

Financial instruments not measured at fair value include cash and cash equivalents, trade and other receivables, trade and other payables, and borrowings due within one year.

 

Due to their short-term nature, the carrying value of cash and cash equivalents, trade and other receivables, trade and other payables and borrowings due within one year approximates their fair value.

 

All non-current assets, non-current receivables and long-term loan are classified as Level 3 in the fair value hierarchy.

 

Reconciliation - Level 3 recurring fair value measurements:

 

2021

2020

2020

 

6 months

6 months

Year

 

to 30 June

to 30 June

to 31 December

 

(unaudited)

(unaudited)

(audited)

 

$000

$000

$000

Non-current assets - Land

 

 

 

Opening balance

142,276

137,936

137,936

Addition

1,567

2,581

4,858

Disposal

(321)

-

(243)

Net unrealised loss recognised during the period

(1,300)

(1,243)

(1,142)

Reversal of impairment loss / (Impairment loss)

54

(1,338)

2,196

Exchange difference

(3,901)

(4,131)

(1,329)

Closing balance

138,375

133,805

142,276

 

The valuation techniques and significant unobservable inputs used in determining the fair value measurement of non-current receivables and borrowings due after one year, as well as the inter-relationship between key unobservable inputs and fair value, are set out in the table below:

 

Item

Valuation approach

Inputs used

Inter-relationship between key unobservable inputs and fair value

 

 

Non-current receivables

Due from non-controlling interests

Based on cash flows discounted using current lending rate of 6% (H1 2020 and 2020: 6%).

 

Discount rate

The higher the discount rate, the lower the fair value.

 

Due from cooperatives under Plasma scheme

Based on cash flows discounted using an estimated current lending rate of 6.75% (H1 2020: 6.78%, 2020: 6.75%).

 

Discount rate

The higher the discount rate, the lower the fair value.

 

10.  Report and financial information

 

Copies of the interim report for the Group for the period ended 30 June 2021 are available on the AEP website at https://www.angloeastern.co.uk/.

 

 

 

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