Agriterra, the Company with agricultural operations in Mozambique and Sierra Leone, has issued a trading update in which it says that in the six months to 30th November it had seen a 115% increase in revenue, that the Chimoio abattoir was fully operational as of December 3rd and that it would be building up the abattoir operations to 4000 head per month from the initial 200. A retail unit opened in Chimoio yesterday and an additional unit is opening in Tete later this month. It had also acquired an additional 1000 hectares of land contiguous with its existing Mavonde Stud Ranch to support a breeding herd of 10,000 head in total by 2015. It currently has 4,779 head of cattle. Finally it said that it had achieved record maize meal sales and had set new monthly milling records.
Agriterra has put a lot of investment into building its agricultural operations in Mozambique and it feels like we are about to start reaping the rewards. The share price has been hit over the last couple of months since it sold its legacy oil assets. I can only imagine that there were a lot of shareholders who were holding in the hope of a major oil find and not for the agricultural story. Hopefully they have nearly all been shaken out and the shares can start to perform as the agricultural business expands. In my note of 27th November, when I bought the shares I highlighted an NAV per share of around 5.2p compared to the current price of 2.75p!
Hopefully today’s announcement will help get the share price moving in the right direction.
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