Half Yearly Report

RNS Number : 5582T
Asian Plantations Limited
30 September 2010
 



30 September 2010

 

Asian Plantations Limited

("APL" or the "Company")

 

Interim Results for the six months ended 30 June 2010

 

Asian Plantations Limited (LSE: PALM), a palm oil plantation company with operations in Malaysia, is pleased to announce its unaudited interim results for the six month period ending 30 June 2010.

 

Highlights

 

·     First revenue reported from the sale of fresh fruit bunches ("FFB").

 

·     Fundraise of £4.25 million (circa. US$6.6 million) on 16 August 2010, via a Company sponsored institutional placing at 110 pence per share, representing a 46.7 per cent. premium to the Company's admission price of 75 pence per share on 30 November 2009.  Concurrently, the Company secured a new RM24.7 million (circa. US$7.8 million) nine year debt facility from a local bank in Malaysia.

 

·     Aggressive planting program underway, with the Company on track to complete the planting of its first estate, BJ Corporation, by 2011, and Incosetia by 2012.

 

·     Acquisition of the Fortune estate provides additional important scale to the Company's operations and is expected to be fully planted by 2013.  All planting targets are subject to the availability of the required working capital.

 

·     Up-sizing of the Company's milling plans, from 90 tonnes per hour to 120 tonnes per hour, based on the current land resource owned by the Company and third party crop in the area.  The Company's mill is expected to be operational in 2012 and will utilize advanced vertical sterilizer technology with methane recapture.

 

Datuk Linggi, Non-Executive Chairman of APL, commented:

 

"We are now into our third year of significant investment and land development. Based on the current planting schedule, we expect to harvest over 20,000 tonnes of FFB in 2012, with a target of up to 375,000 tonnes per annum, as all three existing fields fully mature.

 

The Fortune acquisition is consistent with our previously stated strategy to achieve a land resource of titled, Malaysian agricultural land in excess of 20,000 hectares by year-end 2011. Equally important, the acquired land is in close proximity to our existing estates, thereby allowing one mill to service the entire area.

 

All indicators point to increased scarcity for Malaysian titled land, a continued slow-down of palm oil exports from Malaysia and rising global awareness about the importance of palm oil in the global food supply chain. Coupling these trends with a rising edible oil price environment, the board of APL believes that its strategy of assembling wholly owned, properly titled, land parcels in Malaysia, an investment grade rated country, will generate substantial value for the Company's shareholders."

 

 

For further information contact:

 

Asian Plantations Limited

Dennis Melka, Joint Chief Executive Officer

Graeme Brown, Joint Chief Executive Officer

 

 

                            Tel: +65 9878 4171

Tel: +60 19 856 0221

Strand Hanson Limited

James Harris

Paul Cocker

Liam Buswell

 

 

Tel: +44 (0)20 7409 3494

Panmure Gordon (UK) Limited

Tom Nicholson

Edward Farmer

 

 

Tel: +44 (0) 20 7459 3600

Bankside Consultants

Simon Rothschild

Louise Mason

 

 

Tel: +44 (0) 20 7367 8871

Tel: +44 (0 )20 7367 8872

 

 

Asian Plantations Limited and its Subsidiaries

Unaudited interim results for the six month period ending 30 June 2010

 

 

Consolidated Income Statement

For the six months ended 30 June 2010

                                                                                                                                                  

 

 

 


Note


Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009




USD'000


USD'000


USD'000




Unaudited


Unaudited


Audited









Revenue



101


-


-









Cost of sales



(78)


-


-

















Gross profit



23


-


-









Other income



18


-


48









Other items of expenses








Administrative expenses

3


(942)


(24)


(1,306)

Other expenses

4


(543)


(52)


(107)

Finance expenses



(565)


-


(22)

















Loss before taxation



(2,009)


(76)


(1,387)

Income tax expense



-


-


-

















Loss for the period/year



(2,009)


(76)


(1,387)

















Loss attributable to :
















Owners of the parent



(2,009)


(72)


(1,371)

Non-controlling interest



-


(4)


(16)




















(2,009)


(76)


(1,387)

















Loss per share attributable to owners of the parent (cents per share)
















Basic

5


(6.8)


(0.4)


(6.8)









 

 

 

 

Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2010

                                                                                                                                                  

 

 

 


Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009


USD'000


USD'000


USD'000


Unaudited


Unaudited


Audited







Loss for the period/year

(2,009)


(76)


(1,387)







Other comprehensive income:






Foreign currency translation adjustments

612


(100)


(203)













Total comprehensive income for the period/year

(1,397)


(176)


(1,590)













Total comprehensive income attributable to:












Owners of the parent

(1,397)


(165)


(1,580)

Non-controlling interest

-


(11)


(10)














(1,397)


(176)


(1,590)







 

 

 

 

 



Consolidated Statement of Financial Position as at 30 June 2010

                                                                                                                                                  

 

 

 



Note


30.6.2010


30.6.2009


31.12.2009





USD'000


USD'000


USD'000





Unaudited


Unaudited


Audited










Non-current assets









Property, plant and equipment


6


6,369


1,262


5,063

Biological assets


7


7,925


1,902


6,093

Land use rights


8


21,824


6,023


20,950

Goodwill on consolidation




561


189


534



















Total non-current assets




36,679


9,376


32,640



















Current assets


















Inventories




83


68


45

Trade and other receivables




179


100


180

Prepaid operating expenses




133


-


82

Cash and cash equivalents




1,736


92


4,174



















Total current assets




2,131


260


4,481



















Total assets




38,810


9,636


37,121



















Current liabilities


















Trade and other payables




1,108


688


1,383

Loans and borrowings


9


1,901


1,711


2,544



















Total current liabilities




3,009


2,399


3,927



















Non-current liability









Loans and borrowings


9


23,939


1,431


19,935



















Total non-current liabilities




23,939


1,431


19,935



















Total liabilities




26,948


3,830


23,862



















Net assets




11,862


5,806


13,259



















 

 



Consolidated Statement of Financial Position as at 30 June 2010 (cont'd)

                                                                                                                                                  

 

 

 






30.6.2009


31.12.2009






USD'000


USD'000






Unaudited


Audited









Attributable to owners of the parent


















Share capital


10


35,459


5,849


35,459

Other reserves




(19,714)


(246)


(20,452)

Accumulated losses




(3,883)


(283)


(1,748)























11,862


5,320


13,259



















Non-controlling interests





486


-



















Total equity





5,806


13,259










 

 

 

 

Consolidated Statement of Changes in Equity

For the six months ended 30 June 2010

                                                                                                                                                              

 

 

 


Attributable to owners of the parent




 

 

Share

Capital


Other reserves


Accumu-lated losses


Total share capital and

reserves


Non-controlling interests


Total

equity


USD'000


USD'000


USD'000


USD'000


USD'000


USD'000













For the six months ended












30.6.2010
























Unaudited












At 1 January 2010

35,459


(20,452)


(1,748)


13,259


-


13,259

























Loss for the period

-


-


(2,009)


(2,009)


-


(2,009)













Other comprehensive income for the period

-


738


(126)


612


-


612













Total comprehensive income for the period

-


738


(2,135)


(1,397)


-


(1,397)

























At 30 June 2010

35,459


(19,714)


(3,883)


11,862


-


11,862





































For the six months ended












30.6.2009
























Unaudited












At 1 January 2009

5,849


13


(377)


5,485


497


5,982

























Loss for the period

-


-


(72)


(72)


(4)


(76)













Other comprehensive income for the period

-


(259)


166


(93)


(7)


(100)













Total comprehensive income for the period

-


(259)


94


(165)


(11)


(176)

























At 30 June 2009

5,849


(246)


(283)


5,320


486


5,806





































 

Consolidated Statement of Changes in Equity

For the six months ended 30 June 2010 (cont'd)

                                                                                                                                                              

 

 

 


Attributable to owners of the parent






Share

Capital


Other reserves


Accumu-lated losses


Total share capital and

reserves


Non-controlling interests


Total

equity


USD'000


USD'000


USD'000


USD'000


USD'000


USD'000













For the year ended












31.12.2009
























Audited












At 1 January 2009

5,849


13


(377)


5,485


497


5,982

























Loss for the period

-


-


(1,371)


(1,371)


(16)


(1,387)













Other comprehensive income for the year

-


(209)


-


(209)


6


(203)













Total comprehensive income for the year

-


(209)


(1,371)


(1,580)


(10)


(1,590)













Share issuance expense

(160)


-


-


(160)


-


(160)













Issuance of ordinary shares for cash

8,714


-


-


8,714


-


8,714













Issuance of new shares as consideration for acquisition of a subsidiary company

26,905


-


-


26,905


-


26,905













Adjustment due to pooling of interest method

(5,849)


(20,256)


-


(26,105)


-


(26,105)













Acquisition of minority interest in a subsidiary

-


-


-


-


(487)


(487)

























At 31 December 2009

35,459


(20,452)


(1,748)


13,259


-


13,259













 

 

 

Consolidated Statement of Cash Flow

For the six months ended 30 June 2010

                                                                                                                                                  

 

 

 


Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009


USD'000


USD'000


USD'000


Unaudited


Unaudited


Audited







Cash flows from operating activities






Loss before taxation

(2,009)


(76)


(1,387)







Adjustments for:






Amortisation of land use rights

198


51


88

Depreciation of property, plant and equipment

22


20


2

Gain arising from changes in fair value of biological assets

 

-


(828)


-

Interest expense

565


-


22

Currency realignment

(38)


1


303













Operating cash flows before changes in working capital

 

(1,262)


(832)


(972)







 Increase in inventories

(38)


(37)


(13)

Decrease/(Increase) in trade and other receivables

1


8


(69)

Increase in prepaid operating expenses

(51)


-


(24)

(Decrease)/Increase in trade and other payables

(316)


394


(6,884)













Cash flows from operations

(1,666)


(467)


(7,962)







Interest paid

(638)


(54)


(165)













Net cash used in operating activities

(2,304)


(521)


(8,127)













Cash flows from investing activities






Net cash outflow arising from the acquisition of a subsidiary

 

-


-


(12,021)

Purchase of property, plant and equipment

(1,169)


(828)


(2,474)

Addition to biological assets

(1,387)


-


(1,919)

Acquisition of minority interest in a subsidiary

-


-


(487)













Net cash used in investing activities

(2,556)


(828)


(16,901)







 

 



Consolidated Statement of Cash Flow 

For the six months ended 30 June 2010 (cont'd)

                                                                                                                                                  

 

 

 


Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009


USD'000


USD'000


USD'000


Unaudited


Unaudited


Audited







Cash flows from financing activities






Proceeds from issuance of ordinary shares

-


-


8,714

Share issuance expenses

-


-


(160)

Drawdown of term loans

2,226


1,370


20,581

Repayment of finance lease

(18)


(2)


(9)













Net cash generated from financing activities

2,208


1,368


29,126













Net (decrease)/increase in cash and cash equivalents

 

(2,652)


19


4,098

Effect of exchange rates on cash and cash equivalents

 

214


 

(1)


2

Cash and cash equivalents, beginning balance

4,174


74


74













Cash and cash equivalents, ending balance

1,736


92


4,174







 

 

 

Notes on Financial Statements - 30 June 2010

 

 

1.         General Information

 

Asian Plantations Limited (the "Company") is a limited liability company incorporated and domiciled in the Republic of Singapore and listed on the Alternative Investment Market ("AIM") of the London Stock Exchange.

 

The registered office of the Company is located at No.14 Ann Siang Road, #02-01, Singapore 069694.

 

The principal activity of the Company is that of investment holding. The principal activities of the subsidiaries are development of oil palm plantation. 

 

 

2.         Basis of preparation and accounting polices

 

The consolidated financial statements for the six months ended 30 June 2010 are unaudited and do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2009.

 

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

 

The accounting policies, presentation and methods of computation have been followed in these unaudited financial statements as were applied in the preparation of the Group's annual financial statements for the year ended 31 December 2009.

 

The financial statements are presented in United States Dollars ("USD") to facilitate the comparison of financial results with companies in the Oil-palm industry and all values are rounded to the nearest thousand ("USD'000") except when otherwise indicated.

 

The consolidated financial statements for the six months ended 30 June 2010 was approved by the Directors on 28 September 2010.

 

            Foreign currency

        

The functional currencies of the entities in the Group have been determined to be Ringgit Malaysia ("RM"), and the unaudited interim consolidated financial information of the subsidiary undertakings have been drawn up in RM.

 

The results and financial position of the Group have been translated from its functional currency to its presentation currency for the respective year/periods at the following rates:

 


30.6.2010


30.6.2009


31.12.2009







RM/USD






Assets and liabilities

3.2575


3.5225


3.4245

Income and expenses

3.2993


3.5898


3.5233

 

 

 

3.         Administrative expenses

 

Included in administrative expenses are audit, tax, legal and other professional fees amounting to USD464,000 (Year ended 31.12.2009: USD759,000; six months ended 30.6.2009: USD11,000).

 

 

4.         Other expenses

 

Included in other expenses are costs associated with the acquisition of subsidiaries amounting to USD212,000 (Year ended 31.12.2009: USD38,000; six months ended 30.6.2009: Nil). 

 

 

5.         Loss per share

 

The basic loss per share amounts are calculated by dividing the loss for the period attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the period. 

 

The following tables reflect the loss and share data used in the computation of basic loss per share for the respective periods: 

 



Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009



USD'000


USD'000


USD'000



Unaudited


Unaudited


Audited








Loss attributable to owners of the parent


(2,009)


(72)


(1,371)










Number of shares


Number of shares


Number of shares



'000


'000


'000

Weighted average number of ordinary shares outstanding


29,577


20,019


20,019








 

For the purpose of basic loss per share computation, the weighted average number of ordinary shares outstanding is assumed to be 20,019,000 for the period ended 30 June 2009 for comparative purpose.

 

The Group does not have any diluted loss per share as there is no dilutive potential ordinary share during the current and previous periods. 

 

6.         Property, plant and equipment

 




30.6.2010


30.6.2009


31.12.2009

 




USD'000


USD'000


USD'000

 




Unaudited


Unaudited


Audited

 









 

At cost








 

At 1 January



5,063


401


401

 

Additions



1,169


871


2,624

 

Acquisition of subsidiaries



-


-


2,016

 

Depreciation



(135)


(20)


(55)

 

Exchange differences



272


10


77

 









 









 




6,369


1,262


5,063

 









 









 

Depreciation of property, plant and equipment capitalized to biological assets:



113


-


53

















 









 

 

7.         Biological assets 

 




30.6.2010


30.6.2009


31.12.2009




USD'000


USD'000


USD'000




Unaudited


Unaudited


Audited









At fair value








At 1 January



6,093


1,019


1,019

Additions



1,501


882


2,062

Acquisition of subsidiaries



-


-


2,941

Exchange differences



331


1


71




















7,925


1,902


6,093

















Represented by:








Mature plantation



890


-


847

Immature plantation



5,996


1,274


4,537

Nursery



1,039


628


709









 









 




7,925


1,902


6,093

 









 









 









 

 

Mature oil palm trees produce fresh fruit bunches("FFBs") which are used to produce Crude Palm Oil ("CPO"). The fair values of oil palm plantations are determined by using the discounted future cash flows of the underlying plantations.  The expected future cash flows of the oil palm plantations are determined using the projected selling prices of CPO in the market.

 

 

Significant assumptions made in determining the fair values of the mature oil palm plantations, using a discounted cash flow model, are as follows:

 

(a)        no new planting or re-planting activities are assumed;

 

(b)        oil palm trees have an average life that ranges from 28 years (31.12.2009: 28 years; 30.6.2009: 28 years), with the first three years as immature and the remaining years as mature;

 

(c)        discount rate used for the Group's plantation operations which is applied in the discounted future cash flows calculation is 8.9% (31.12.2009: 8.9%; 30.6.2009: 8.9%);

 

(d)        FFB price is derived by applying the oil extraction rate to the estimated CPO price of USD715 (31.12.2009: USD584; 30.6.2009: USD568) per metric tonne; and

 

(e)        yield per hectare of oil palm trees is based on the standard yield profile of the industry.

 

 

8.         Land use rights  

 




30.6.2010


30.6.2009


31.12.2009




USD'000


USD'000


USD'000




Unaudited


Unaudited


Audited









At cost








At 1 January



20,950


6,178


6,178

Acquisition of subsidiaries



-


-


14,808

Amortisation charge



(198)


(51)


(105)

Exchange differences



1,072


(104)


69




















21,824


6,023


20,950

















 

9.         Loans and borrowings   

 




30.6.2010


30.6.2009


31.12.2009




USD'000


USD'000


USD'000




Unaudited


Unaudited


Audited









Current








Short term revolving credit



1,841


1,703


1,752

Term loans



-


-


765

Obligation under finance leases



60


8


27




















1,901


1,711


2,544

















Non-Current








Term loans



23,668


1,396


19,817

Obligation under finance leases



271


35


118




















23,939


1,431


19,935

















Total loans and borrowings








Short term revolving credit



1,841


1,703


1,752

Term loans



23,668


1,396


20,582

Obligation under finance leases



331


43


145




















25,840


3,142


22,479

















Maturity of borrowings (excluding   obligations under finance leases)
















Within one year



1,841


1,703


2,517

After one year but not more than five 

 years



 

9,840


 

1,396


 

13,496

More than five years



13,828


-


6,321




















25,509


3,099


22,334

















 

Short-term revolving credit and term loans

 

The short term revolving credit is denominated in RM and bears interest at the rate of the bank's cost of fund plus 1.75%. It is repayable on demand and has a six months' rollover period upon maturity.

 

The term loans are denominated in RM and bear interest ranging from the rate of the bank's cost of fund plus 1.75% per annum to base lending rate plus 1% per annum. They are repayable over 6 years, after the grace period of 3 to 4 years.

 

The short term revolving credit and term loans are secured by 1st and 3rd parties legal charges over the rights to use a long term leasehold land of which the Group has prepaid the lease payments relating to the land as disclosed in Note 8 and is also supported by corporate guarantees from the Company and a director related company.

 

For all the BJ Corporation Sdn Bhd Banking Facilities, it is further supported by a Joint and Several Guarantee from Datuk Linggi, Dennis Melka and Graeme Brown.

For Asian Plantations (Sarawak) Sdn Bhd Banking Facility of RM55 million is further supported by a Joint and Several Guarantee from Datuk Linggi, Dennis Melka, Graeme Brown and Gerald Baring Linggi.

 

 

10.       Share capital   

 


Six Months ended

30.6.2010


Six Months ended 30.6.2010


Six Months ended 30.6.2009


Six Months ended 30.6.2009


Year  ended 31.12.2009


Year

ended 31.12.2009


No. of shares




No. of shares




No. of shares




'000


USD'000


'000


USD'000


'000


USD'000


Unaudited


Unaudited


Unaudited


Unaudited


Audited


Audited













At 1 January

29,577


35,459


20,260


5,849


20,260


5,849

Adjustment due to pooling of interest method

-


 

 

-


-


 

 

-


 

 

(20,260)


(5,849)

Issuance of new shares as consideration for acquisition of a subsidiary company

-


 

 

 

 

 

-


-


 

 

 

 

 

-


22,500


26,905

Addition during the period/year

-


 

-


-


 

-


7,077


8,714

Share issuance expense

-


 

-


-


 

-


 

-


(160)


























29,577


35,459


20,260


5,849


29,577


35,459













 

 

11.       Related party disclosure

 

The Group had the following transactions with a related party during the periods:

 

 



Six Months

Ended

30.6.2010


Six Months

Ended

30.6.2009


Year

Ended

31.12.2009



USD'000


USD'000


USD'000



Unaudited


Unaudited


Audited








Transactions with Director:

- Repayment of advances from a Director of a subsidiary


-


-


103








 

12.       Subsequent events

 

On 16 August 2010, the Company announced that it has entered into subscription agreements with a number of institutional investors for a total of 3,868,083 new ordinary shares at a subscription price of 110 pence per share (the "Subscription").  The Subscription raised approximately £4.25 million (equivalent to USD6.6 million), before expenses.

The Company has entered into a conditional agreement dated 1 September 2010 to acquire the entire issued share capital of Fortune (the "Proposed Acquisition"), which owns a partly developed palm oil plantation totaling approximately 5,000 hectares in Sarawak, Malaysia.

The total consideration for the Proposed Acquisition, which is subject to a number of conditions, is RM38.7 million (equivalent to USD12.2 million) and is payable in two tranches. The initial non-refundable tranche of RM3.9 million (equivalent to USD1.2 million) was settled on 1 September 2010 and a further tranche of RM34.8 million (equivalent to USD11.0 million) is to be paid by 29 November 2010.



 

 

 


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