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RNS Number : 2598Q Anglo-Eastern Plantations PLC 30 May 2024
30 May 2024
Anglo-Eastern Plantations Plc
("AEP", "Group" or "Company")
Trading Statement
AEP is a major producer of palm oil, and to a lesser extent rubber, with
plantations across Indonesia and Malaysia, today announces a trading update in
respect of the first quarter ended 31 March 2024.
Operational and financial performance
For the first three months ended 31 March 2024, our own production of fresh
fruit bunches ("FFB") from operations was 232,000mt, a decrease of 5% compared
to the same period in 2023 (3M23: 243,500mt). Lower production trends were
experienced in all regions except for Bangka and Kalimantan. In Bangka matured
plantings were higher in 2024 with ideal weather conditions as well as in
Kalimantan where matured plantings were also higher with most trees reaching
peak production age. Rainfall in North Sumatera was generally irregular with
two continuous months of rainfall below the ideal monthly benchmark of 150mm.
On the other hand, rainfall in Bengkulu and KAP in Kalimantan was exceptional
high, above 400mm per month for the entire quarter, disrupting harvesting
activities. Another reason for the lower production in North Sumatera and
Bengkulu was due the reduction of matured trees as a result of replanting.
Over the last year 1,742 hectares were felled for replanting.
FFB bought-in was also lower at 190,400mt (3M23: 204,700mt), a decrease of 7%.
The drop in external crop purchases across all its mills, except for Blankahan
mill in North Sumatera and Bina Pitri Mill in Riau, was due to lower crop
trend induced by weather as well as intense competition for external crops. As
a result, crude palm oil ("CPO") production was lower by 7% at 86,200mt
compared to 92,600mt for the same period last year.
The CPO price ex-Rotterdam averaged $1,004/mt for the first three months of
2024, a decrease of 1% from the average price of $1,016/mt in the
corresponding quarter in 2023. The average price was however better than
$935/mt at the start of the year. The ex-mill price, as a result, was lower by
4% at $735/mt compared to $763/mt for the same period last year. Despite palm
oil supply remaining tight in the first quarter of 2024 due to lower
production and poor weather affecting harvesting, the CPO price was somewhat
lower than last year due to the abundance of soft-oil and a fragile demand.
The Group's balance sheet remains strong with no outstanding bank loans. The
Group had net cash of $136.6 million as at 31 March 2024 compared to $284.6
million at the period end in 2023. The significant reduction in cash was
principally due to the consolidation of AEP's holding in Indonesian
subsidiaries by purchasing minority interests in late 2023 and allocating
funds into investments for better yield.
Development
AEP has plantations across Indonesia and Malaysia, amounting to approximately
90,500 hectares, of which approximately 68,680 hectares including plasma are
planted. New planting for the first three months ended 31 March 2024 was lower
at 66 hectares (3M23: 202 hectares) including plasma. Another 93 hectares were
replanted in Bengkulu in the first three months of 2024.
The HPP Mill has commenced operation but has only processed its own crop for
the first quarter of 2024. It will start purchasing external crops once the
effluent treatment plant is fully commissioned, which is expected to be in the
third quarter of 2024, to increase the utilisation of the mill.
The earthworks design for the eighth mill in the KAP estate in Kalimantan has
been completed. The building permit is pending the evaluation of the
Environmental department of which we have been assured is at the final stage
of approval. We are hopeful to start the earthworks by the third quarter of
2024
Outlook
The CPO price ex-Rotterdam started the year at $935/mt. Since then, it has
trended marginally upwards to close at $990/mt on 27 May 2024.
The demand for CPO is expected to remain weak and may decline in the near
term, especially against the backdrop of a seasonal increase in soybean
production in South America.
For further enquiry, contact:
Anglo-Eastern Plantations Plc
Dato' John Lim Ewe
Chuan
+44 (0)20 7216 4621
Panmure Gordon (UK) Limited
Dominic Morley / Amrit Mahbubani
+44
(0)20 7886 2500
This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 as it forms part of UK domestic law by virtue of
the European Union (Withdrawal) Act 2018.
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