REG - Dekel Agri-Vision - Full Year 2022 Palm Oil Production Update

Dekel Agri-VisionAnnouncement

10/01/2023 07:00

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RNS Number : 1604M  Dekel Agri-Vision PLC  10 January 2023

 

Dekel Agri-Vision Plc / Index: AIM / Epic: DKL / Sector: Food Producers

Dekel Agri-Vision Plc ('Dekel' or the 'Company')

Full Year 2022 Palm Oil Production Update

 

Dekel Agri-Vision Plc, the West African focused agriculture company, is
pleased to provide a production update for its 100%-owned vertically
integrated Ayenouan palm oil project in Côte d'Ivoire ('Palm Oil Operation)
for the year ended 31 December 2022.

 

Key Highlights

Summary - Full year 2022 and 2023 Outlook

·      2022 can be summarised as a year of record Crude Palm Oil ('CPO')
and Palm Kernel Oil ('PKO') pricing with strong CPO extraction rates being
offset by an unprecedently low fresh fruit bunches ('FFB') annual harvest.

·      Whilst financial results of the Palm Oil Operation are unlikely
to surpass the record 2021 results, the FY 2022 financial results are still
expected to be one of the best performing years since inception.

·      In the event that production volumes normalise and CPO and PKO
prices remain robust, the Directors believe that the Palm Oil operation has
the potential to deliver a record financial performance in 2023.

 

December 2022 Production and Sales

·      Dekel achieved a 42.7% improvement in FFB processed as compared
to November and there was further improvement in CPO extraction rates to 22.8%
as compared to 20.9% last month.

·      However, like for like monthly CPO production volumes remained
low compared to the December 2021 record monthly production (20.3% lower).

·      CPO prices remain robust with prices achieved continuing to be
close to all-time highs (€1,102 per tonne).  International CPO prices
remained steady in December 2022 with prices trading around €1,000 per
tonne.

 

2022 Full Year Production and Sales

·      Dekel had a full year production of CPO of 25,751 tonnes and CPO
sales of 26,016 tonnes.

·      The Company had a record full year CPO price of €1,025 per
tonne and a record full year PKO price achieved of €1,381 per tonne.

 

Further details regarding production and sales for December and for the 2022
full year can be found in the table below.

                          Dec-22    Dec-21    Change  FY 2022   FY 2021  Change

 FFB processed (tonnes)   10,502    14,395    -27.0%  116,733   190,020  -38.6%
 CPO Extraction Rate      22.8%     20.9%     9.1%    22.1%     21.0%    5.2%
 CPO production (tonnes)  2,398     3,010     -20.3%  25,751    39,953   -35.5%
 CPO sales (tonnes)       2,195     3,225     -31.9%  26,016    39,092   -33.4%
 Average CPO price/tonne  €1,102    €968      13.8%   €1,025    €868     18.1%
 PKO production (tonnes)  155       239       -35.1%  1,824     2,549    -28.4%
 PKO sales (tonnes)       122       168       -27.4%  1,991     2,707    -26.4%
 Average PKO price/tonne  €1,143    €1,372    -16.7%  €1,381    €851     62.3%
 PKC production (tonnes)  45        369       -87.8%  1,875     4,019    -53.3%
 PKC sales (tonnes)       20        356       -94.4%  717       3,076    -76.7%
 Average PKC price/tonne  €76       €78       2.6%    €86       €78      10.3%

These figures remain subject to full year audit and year end stock adjustments

 

Crude Palm Oil Production

·      35.5% decrease in FY2022 CPO production compared to FY2021 driven
by an unprecedently low FFB harvest year.

·      20.3% decrease in December 2022 CPO production compared to
December 2021.

·      An improved CPO extraction rate of 22.1% was achieved in FY 2022
(FY 2021: 21.0%).

·      Production over the past 2-3 months has normalised compared to
historic levels which we are hopeful will continue into the upcoming high
season.

 

Sales and Pricing

·      33.4% decrease in FY2022 CPO sales compared to FY2021 reflecting
the lower CPO production volumes.

·      18.1% increase in CPO prices to €1,025 per tonne in FY2022
compared to FY2021 (FY 2022: €868).  This represents an annual Company
record sales price.

·      13.8% increase in December 2022 CPO prices achieved of €1,102
per tonne compared to December 2021.

·      Continued robust CPO pricing bodes well for the upcoming 2023
high season and local demand for CPO remains strong given local supply
constraints resulting from the weak harvesting year.

 

Palm Kernel Oil Production and Sales

·      28.4% decrease in FY 2022 PKO sales compared to FY 2021
reflecting lower production levels.

·      Company record PKO price achieved in FY 2022 of €1,381 per
tonne.  PKO prices have softened in H2 2022 to around €1,100 but still
remain at historically high levels.

 

Issue of Equity

In addition, application has been made to the London Stock Exchange for the
admission of a total of 550,323 ordinary shares of €0.0003367 each
("Ordinary Shares") issued to certain advisers in settlement of fees for
services provided ("Admission"). It is expected that Admission will become
effective on or around 18 January 2023. Following Admission, the Company's
issued share capital will consist of 537,955,098 Ordinary Shares which may be
used by shareholders as the denominator for the calculations by which to
determine if they are required to notify their interest in, or a change to
their interest in, the Company under the FCA's Disclosure and Transparency
Rules.

 

Dekel Executive Director Lincoln Moore said: "2022 was an unprecedently low
FFB harvest year for the Palm Oil operation.  However, a supportive price
environment and internal efforts to maximise prices, including utilising
regional export markets as well as a strong focus on operational and cost
efficiencies, including an improved CPO extraction rate, mean that the
expected 2022 financial results of the Palm Oil Operation will still be among
the best performing years."

 

"With the annual high season commencing shortly we are hopeful of improved FFB
harvesting volumes. Together with continued robust prices we are well
positioned to see a strengthening in financial profitability.  We will
continue to report the Palm Oil Operation data monthly to ensure our
shareholders are well informed during this exciting period for the Company."

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR").  Upon the publication of this announcement via a
Regulatory Information Service ("RIS"), this inside information is now
considered to be in the public domain.

 

** ENDS **

 

For further information please visit the Company's website
www.dekelagrivision.com or contact:

 

 Dekel Agri-Vision Plc                     +44 (0) 207 236 1177

 Youval Rasin

 Shai Kol

 Lincoln Moore

 WH Ireland Ltd (Nomad and Joint Broker)   +44 (0) 20 7220 1666

 James Joyce

 Megan Liddell

 Optiva Securities Limited (Joint Broker)  +44 (0) 203 137 1903

 Christian Dennis

 Jeremy King

 

Notes:

Dekel Agri-Vision Plc is a multi-project, multi-commodity agriculture company
focused on West Africa. It has a portfolio of projects in Côte d'Ivoire at
various stages of development: a fully operational palm oil project in
Ayenouan where fruit produced by local smallholders is processed at the
Company's 60,000tpa capacity crude palm oil mill and a cashew processing
project in Tiebissou, which is currently transitioning to full commercial
production in 2023.

 

 

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