REG - Dekel Agri-Vision - Q1 2024 Palm Oil and Cashew Operations Update

Dekel Agri-VisionAnnouncement

11/04/2024 07:00

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RNS Number : 1136K  Dekel Agri-Vision PLC  11 April 2024

 

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

 

11 April 2024

 

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

 

Dekel Agri-Vision Plc

('Dekel' or the 'Company')

Q1 2024 Palm Oil and Cashew Operations Update

 

Dekel Agri-Vision Plc (AIM: DKL), the West African agriculture company focused
on building a portfolio of sustainable and diversified projects, is pleased to
provide its Q1 2024 production for the Ayenouan palm oil project in Côte
d'Ivoire ('Palm Oil Operation') and the cashew processing plant at Tiebissou,
Côte d'Ivoire (the 'Cashew Operation').

 

Palm Oil Operation Update

·      The Palm Oil Operation reported a strong Q1 2024 with Fresh Fruit
Bunch ('FFB') volumes and Crude Palm Oil ('CPO') production increasing 30% and
23.5% respectively compared to Q1 2023.

o  March 2024 monthly production was marginally lower than March 2023

·      CPO sales quantities increased 18.8% in Q1 2024 compared to last
year.  The relatively high levels of CPO inventory, and in particular PKO
inventory held at the end of Q1 2024 compared to last year should underpin
strong sales volumes during Q2 2024.

·      The Q1 2024 average CPO sales price achieved was €762 per
tonne, a 21.8% decrease from the record Q1 2023 CPO sales prices.  The local
CPO price in March 2024 continued to trend upwards month on month increasing
2.4% compared to February 2024.  Whilst encouraging, local CPO prices remain
below international CPO prices as efforts continue locally to manage food
prices.

·      The CPO extraction rate for Q1 2024 of 21.2% was slightly lower
than Q1 2023.  Early guidance in April 2024 shows CPO extraction rates
increasing towards 22%.

·      Overall, due to the relatively strong production volume, we
maintain on track to deliver a strong H1 2024 performance.

 

                                              Mar-24  Mar-23  Change  Q1-24   Q1-23   Change

 FFB processed (tonnes)                       23,579  24,508  -3.8%   54,381  41,819  30.0%
 CPO Extraction Rate                          20.9%   21.6%   -3.2%   21.2%   22.3%   -4.9%
 CPO production (tonnes)                      4,929   5,302   -7.0%   11,510  9,318   23.5%
 CPO Sales (tonnes)                           4,509   4,048   -11.4%  9.317   7,843   18.8%
 Average CPO price per tonne                  €777    €967    -19.6%  €762    €974    -21.8%
 Palm Kernel Oil ('PKO') production (tonnes)  259     280     -3.9%   641     493     30.0%
 PKO Sales (tonnes)                           86      383     -50.7%  194     413     -53.0%
 Average PKO price per tonne                  €686    €973    -29.5%  €733    €973    -24.7%

 

Cashew Operation Update

·      The Cashew Operation was intentionally slowed down during Q1 2024
to preserve raw cashew nut ('RCN') inventory while we await the arrival of new
off the shelf shelling and peeling equipment.  This is reflected in the
numbers outlined in the table below.  While the throughput of the existing
shelling and peeling equipment can reach expected breakeven production levels,
the output of unpeeled cashews remains too high hindering gross margins.

·      All new shelling and peeling equipment was ordered in January
2024, with deliveries expected to start arriving in June 2024, which will be
announced in due course.  With optimal performance of the shelling and
peeling stations working in tandem with the other 10 well performing stations,
we expect to see a material improvement in cashew production volumes and
quality during Q3 2024.

·      New shelling and peeling equipment installation being overseen by
a highly credentialled cashew processing consultant.  Other new cashew
processors in our region using this new off the shelf technology shelling and
peeling systems are also achieving excellent results.

 

                                 Q1-24     Q1-23     Change

 RCN Inventory
 Opening RCN Inventory (tonnes)  1,751     1,841     -4.9%
 RCN Purchased (tonnes)          190       820       76.8%
 RCN Processed (tonnes)          (275)     (533)     -48.4%
 RCN Sold (tonnes)               (42)      Nil       n/a
 Closing RCN Inventory (tonnes)  1,624     2,128     23.6%

 Cashew Processing
 Opening Cashews (tonnes)        176       111       58.6%
 RCN Processed (tonnes)          275       533       -48.4%
 Cashew Extraction Rate          18.2%     23.1%     -21.6%
 Cashew Produced (tonnes)        50        123       -59.3%
 Cashew Sales (tonnes)           93        103       -9.7%
 Closing Cashews (tonnes)        133       131       1.5%

 Average Sales prices per tonne
 -       Unpeeled Cashews        €3,150    €3,375    -6.7%
 -       Peeled Cashews          €3,250    €4,500    -27.8%

 

Lincoln Moore, Dekel's Executive Director, said: "The Palm Oil Operation
remains on track to deliver a strong H1 2024 performance and continues to
underpin the Company's financial performance.  The major catalyst for the
next phase of growth and share price performance is the Cashew Operation.
With shelling and peeling equipment scheduled for delivery in June and
installation being overseen by a highly credentialled cashew processing
consultant, we are edging closer towards being in a position to ramp up
production at optimum levels of quality."

 

** 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

 Darshan Patel

 Isaac Hooper

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

 Christian Dennis

 Daniel Ingram

 

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.

 

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