TIDMNBPO
RNS Number : 9945N
New Britain Palm Oil Limited
27 February 2009
?
27 February 2009
NEW BRITAIN PALM OIL LIMITED
("NBPOL", the "Group" or the "Company")
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2008.
Highlights
* Revenues up approximately 56.6% to USD 352.2 million (2007: USD 225.0 million)
* Profit before tax of USD 126.3 million* (2007: USD 79.5 million*) excluding the
effect of revaluing biological assets under IAS 41, excluding the effects of the
acquisition of Ramu Agri-Industries Limited ("RAIL") and excluding net foreign
exchange losses
* Profit before tax of USD 106.3 million* (2007: USD 81.9 million*) excluding the
effect of revaluing biological assets under IAS 41
* Excluding IAS 41, earnings per share attributable to ordinary shareholders were
51.7* US cents (2007: US 40.6* cents)
* A record 1.27 million tonnes of fruit processed and 320,000 tonnes, in
aggregate, of crude palm oil ("CPO") and palm kernel oil ("PKO") produced. Crude
oil production was 7% higher than the preceding year and palm product extraction
rates remained at approximately 28%
* Average CPO selling price achieved by NBPOL during the year was USD 926/tonne
(2007: USD 686/tonne)
* As at the year end, the Group had made "forward sales" of roughly one quarter of
its 2009 production (82,000 tonnes of CPO) at an average price of USD 849/tonne.
As at today's date, this figure is now approximately 156,000 tonnes of palm oil
production at an average price of USD780/tonne
* Gross margin of 53% (2007: 58%) primarily reflects the increased cost of key
inputs such as fuel and fertiliser throughout the year.
* Dividends paid during the year totaling 41.8 US cents per share including an
interim dividend for 2008 of 14 US cents per share. A final gross dividend of 14
US cents to be paid in May 2009
* Successful acquisition of RAIL adding a further 33,000 hectares to our land bank
and extra oil palm production capacity
* Agreement signed for a 25 year lease in Liverpool for the construction of the
UK refinery announced in August 2008 - planning permission was granted in
February 2009 and completion remains on track for Spring 2010
Hj. Ahamad Mohamad, departing Chairman of New Britain Palm Oil Limited,
commented:
"Looking forward we start 2009 in a strong position as our forward sales
strategy has, to date, already secured approximately 156,000 tonnes of palm oil
production at an average price of USD 780/tonne. At the time of writing we are
continuing to make sales at good margins into 2009 and most recently into 2010.
We are also excited by the progress of our UK refinery project, which with
planning permission granted, continues on target. This marks a strategically
important step for the Company with regard to the supply of sustainable palm oil
to our EU customer base. In addition it is pleasing to see the easing of input
costs, notably diesel, fertilisers and agrochemicals that should help restore
our margins. The Board is confident of delivering further growth."
For further information contact:
+-------------------------------------+----------------------------------+
| New Britain Palm Oil Limited | Tel: +44 (0)20 7554 1400 |
| Nick Thompson | |
| Alan Chaytor | |
| | |
+-------------------------------------+----------------------------------+
| Singer Capital Markets Limited | Tel: +44 (0) 20 3205 7500 |
| Nicholas How | |
| Richard Savage | |
| | |
+-------------------------------------+----------------------------------+
| Kreab Gavin Anderson (Financial PR | Tel: +44 (0)20 7554 1400 |
| Adviser) | Email: |
| Ken Cronin | nbpol@kreabgavinanderson.co.uk |
| Janine Brewis | |
| Anthony Hughes | |
| | |
+-------------------------------------+----------------------------------+
Website: www.nbpol.com.pg
* Management believes that the presentation of these adjusted measures is useful
to investors because it provides a means of evaluating the Group's operating
performance and results from period to period on a comparable basis not
otherwise apparent when the impact of IAS41 is included. Management also
believes that this presentation is useful in facilitating comparisons between
the Group and other companies in the industry, some of whom are not required to
comply with IAS41. Refer to notes 3 and 4 for a reconciliation of the adjusted
measures to those including the impact of IAS41, RAIL acquisition, and net
foreign exchange losses
Chairman's statement
Financial overview
The Group had a record year with revenue growing 56.6% in 2008 to USD 352.2
million and our profit before tax, excluding the effect of the RAIL acquisition
and fair value movements arising from the revaluation of biological assets,
rising to USD111.0 million or USD106.3 million inclusive of RAIL. This result is
due to the high commodity prices particularly in the first half of the year.
Profit before tax including revaluation of biological assets was USD 28.8
million. Net profit for the year after tax was USD 22.2 million including the
revaluation of biological assets, down from USD 87.0 million the previous year.
Earnings per share increased from 40.6 cents in 2007 to 51.7 cents excluding the
effects of revaluation of biological assets.
These results reflect the fall in CPO prices during the second half of 2008 and
resultant fall in the fair value of the biological assets. During the year the
Group also incurred foreign exchange losses as a result of holding deposits in
British pounds, essentially to cover the Liverpool refinery build costs, and due
to the continued appreciation of the kina. These losses amounted to USD 15.3
million.
In 2008, the kina continued its appreciation against the US dollar and this has
again had a negative impact as our income statement is translated from kina to
US dollars using the average rate. The 2008 average rate was 37.66 cents against
33.96 cents the previous year. However in the last two months of 2008 the kina
started to decline against the US dollar and this has continued into 2009 as
reduced inflows of commodity exports have reduced the flow of US dollars into
the country.
The Group is in a strong financial position with cash holdings at the end of
2008 of USD 64.6 million with a further USD 55.8 million in trade debtors most
of which is for oil sales and has subsequently been received, while borrowings
have increased from USD 19.7 million in 2007 to USD 58.4 million, primarily as a
consequence of the acquisition of RAIL's debt. We brought forward the interim
2008 dividend so that it falls in the year to which it relates. This has meant
that in 2008 three dividends were paid, totalling 41.8 US cents the last of
which, the interim dividend for 2008, of 14 US cents was paid in October. A
final gross dividend for 2008 of 14 US cents per share will be paid in May 2009.
Late in 2008, freight rates which had been very high started to fall for the
first time in recent years as fuel bunker surcharges fell with the dropping
mineral oil price, this has continued into 2009. Similarly, fuel costs for the
first three quarters of 2008 continued to have a negative impact on the cost of
transportation and milling of fruit. High commodity prices during 2008 impacted
on fertiliser costs for the year and this had an effect on our profit. The
fertiliser was contracted at the start of the year, however the Chinese
government imposed export taxes on several fertilisers that we had ordered and
these costs were passed on to the consumer.
The Group's average selling price for 2008 for CPO was USD 926 per tonne, this
is lower than the average CIF Rotterdam price for the year of USD 998, the
difference reflecting forward sales made at lower prices. The average selling
price achieved compares favourably to the average for the previous year of 698
US dollars.
In 2008, the Group sold 15 million seeds up from 4 million in 2007, an excellent
result although this would have been higher still if demand for seeds had not
dropped. In particular, Indonesian demand fell away as the effects of the
economic downturn impacted local planting programs there. The curtailed planting
programs of these customers will reduce the availability of palm oil in years to
come.
Operational review
In 2008 the Company continued to expand its palm oil production base with the
addition of 7,228 hectares of oil palm, of which 1,895 hectares were new
plantings and 5,333 hectares were existing plantings acquired through the
acquisition of RAIL. Crop volumes continued to rise and 2008 was a record year
for oil production with approximately 320,000 tonnes of crude oil (crude palm
oil and palm kernel oil) produced from the Group's six oil mills. We have
forecast oil production to rise in excess of 350,000 tonnes in 2009 assuming
that there are no unforeseen circumstances.
Fruit production from the estates increased to approximately 875,000 tonnes with
a further 393,000 tonnes purchased from smallholder growers. Overall estate
yields per hectare were slightly disappointing in 2008 and were 6% below our
budget in New Britain, 11% below budget in the Solomon Islands, whilst those at
Ramu were 21% above expectation. On a per hectare basis our most productive
estates continued to have yields that exceeded thirty tonnes of fruit bunches
and overall our average estate yields in New Britain were 24.4 tonnes of fruit
bunches per hectare compared to 20.1 in the Solomon Islands and 15 in Ramu. The
yields at Ramu were affected by both incomplete harvesting during the year as
the oil mill was only commissioned in April and the very young age profile of
the estates.
Weather conditions were generally good throughout 2008 with the exception of a
remarkably wet start to the year in January with over one metre of rainfall in
New Britain. This was followed by February and March that had only half their
annual average rainfall. The year ended in New Britain with 3530mm of rainfall
recorded at our research station, slightly below our annual average of 3734mm,
with no soil moisture deficits recorded and higher than average sunshine hours.
In the Solomon Islands harvesting was affected by prolonged rainfall at the
start of the year. We undoubtedly lost some crop because of this as harvesting
intervals became extended.
Oil extraction rates at our mills showed some improvement in 2008 as we made
significant progress in New Britain to improve the ripeness standards of our
fruit and tighten process controls. The end result was an increase in our crude
palm oil extraction rate from 22.59% in 2007 to 23.19% in 2008. This may not
seem like a huge increase in efficiency but the net effect over the 1,267,274
tonnes of fruit processed in the year amounts to an extra 7,600 tonnes of oil
produced and an associated revenue of USD7.0 million.
The Group now has 47,163 hectares planted with oil palm of which 38,117 hectares
are under harvest with the balance being immature oil palms that have been
planted over the past 3 years. In addition, the Group now has 11,400 hectares of
cattle grazing pastures and 8,193 hectares of sugar cane as a result of the RAIL
acquisition. The Group has a current land area 86,753 hectares of which 70,393
is under cultivation.
The Group has a very young age profile with a weighted average palm age of 8.7
years that has been further enhanced by the acquisition of RAIL where the oldest
commercial palms were planted in 2004. Commercial plantings within the Group are
usually retained for a period of 20-22 years. We currently have a small area in
the Solomon Islands which is older than our normal age limit, however these
areas continue to yield well and will be replanted over the next 2-3 years as
our younger areas come into harvest.
The Company continues to pursue its two pronged strategy of organic growth and
on raising oil yields through our "30:30" initiative. The "30:30" initiative has
the objective of raising fruit yields to 30 tonnes per hectare and palm product
extraction rates to 30%. Whilst fruit yields in 2008 could not be described as
stellar, it is the Directors opinion that overall this is due to the long-term
yield cycle of oil palm and that the prospects for increasing yields are most
achievable in the short term from the very young age profile of the Group and in
the longer term from the production of higher yielding varieties from our plant
breeding program. It is pleasing to report that the Company did make progress by
raising oil yields in 2008 through achieving better extraction rates and further
efforts in this field are being pursued.
Acquisition of Ramu Agri-Industries Limited
The acquisition of RAIL was more protracted than we envisaged but the
finalisation of the deal in September was an important strategic step for the
Group. RAIL has huge potential and with the management expertise that the Group
possesses we are confident that over the next few years RAIL will become a
substantial production base for the Group. Importantly it also gives the Group a
base from which to explore further opportunities in the Ramu and Markham valleys
as well as providing an additional land bank that is not likely to raise any
significant issues from high conservation value forest assessments. The main
constraint to palm oil yields at Ramu will undoubtedly be linked to seasonal
water stress and management have already instigated work to assess irrigation
technologies. We will review the future of the sugar enterprise at Ramu on its
own merits and equally we will focus on intensifying the beef cattle operation
at Ramu and hopefully transfer technology from our existing oil and beef
intercropping experience in New Britain.
Sustainability
The Group has continued to be a leading light amongst the palm oil producers in
its drive towards sustainable production practices. We have been heavily
involved in the Roundtable on Sustainable Palm Oil. As we stand this is the only
body that has a standard for certifying sustainable palm oil and whilst there
are many detractors of this organisation and understandable frustration at the
slow pace of change it is at the moment the only group to have made any
significant progress towards improving production practices. The Board and
management are committed to the roll out of RSPO and ISO 14001 certification to
all of our production sites.
Current trading and outlook
Looking forward we start 2009 in a strong position as our forward sales strategy
has, to date, already secured approximately 156,000 tonnes of palm oil
production at an average price of USD 780/tonne. At the time of writing we are
continuing to make sales at good margins into 2009 and most recently into 2010.
We are also excited by the progress of our UK refinery project, which with
planning permission granted, continues on target. This marks a strategically
important step for the Company with regard to the supply of sustainable palm oil
to our EU customer base. In addition it is pleasing to see the easing of input
costs, notably diesel, fertilisers and agrochemicals that should help restore
our margins. The Board is confident of delivering further growth.
Ahamad Mohamad
26 February 2009
Financial Statements
Consolidated Income Statement (Unaudited)
For the year ended 31 December 2008
+------------------------------+------+------------+----------+------------+
| | | Consolidated |
+------------------------------+------+------------------------------------+
| | | 2008 | | 2007 |
+------------------------------+------+------------+----------+------------+
| | | USD'000 | | USD'000 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Revenue | | 352,219 | | 224,954 |
+------------------------------+------+------------+----------+------------+
| Cost of sales | | (165,817) | | (95,323) |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Gross profit | | 186,402 | | 129,631 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Net (loss) gain arising from | | (77,476) | | 39,702 |
| changes in fair value of | | | | |
| biological assets | | | | |
+------------------------------+------+------------+----------+------------+
| Other income | | 1,399 | | 2,406 |
+------------------------------+------+------------+----------+------------+
| Distribution costs | | (42,118) | | (35,000) |
+------------------------------+------+------------+----------+------------+
| Administrative expenses | | (45,161) | | (17,194) |
+------------------------------+------+------------+----------+------------+
| Operating profit | | 23,046 | | 119,545 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Interest income | | 3,860 | | 62 |
+------------------------------+------+------------+----------+------------+
| Finance costs | | (1,606) | | (1,214) |
+------------------------------+------+------------+----------+------------+
| Net finance income (costs) | | 2,254 | | (1,152) |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Share of profit from joint | | 3,505 | | 3,191 |
| venture | | | | |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| PROFIT BEFORE INCOME TAX | | 28,805 | | 121,584 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Income tax expense | | (6,605) | | (34,611) |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| PROFIT FOR THE YEAR | | 22,200 | | 86,973 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Attributable to: | | | | |
+------------------------------+------+------------+----------+------------+
| Equity holders of the | | 21,245 | | 86,940 |
| Company | | | | |
+------------------------------+------+------------+----------+------------+
| Minority interest | | 955 | | 33 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| | | 22,200 | | 86,973 |
+------------------------------+------+------------+----------+------------+
| | | | | |
+------------------------------+------+------------+----------+------------+
| Earnings per share | | $ | | $ |
+------------------------------+------+------------+----------+------------+
| - Basic | | 0.147 | | 0.600 |
+------------------------------+------+------------+----------+------------+
| - Diluted | | 0.147 | | 0.600 |
+------------------------------+------+------------+----------+------------+
Consolidated Balance Sheet (Unaudited)
At 31 December
+-----------------------------+------+-------------+--+-------------+
| | | Consolidated |
+-----------------------------+------+------------------------------+
| | | 2008 | | 2007 |
+-----------------------------+------+-------------+--+-------------+
| | | USD'000 | | USD'000 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| NON CURRENT ASSETS | | | | |
+-----------------------------+------+-------------+--+-------------+
| Property, plant and | | 326,817 | | 182,177 |
| equipment | | | | |
+-----------------------------+------+-------------+--+-------------+
| Biological assets | | 67,732 | | 134,143 |
+-----------------------------+------+-------------+--+-------------+
| Investments | | 4,779 | | 3,515 |
+-----------------------------+------+-------------+--+-------------+
| | | 399,328 | | 319,835 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| CURRENT ASSETS | | | | |
+-----------------------------+------+-------------+--+-------------+
| Cash and cash equivalents | | 64,582 | | 135,600 |
+-----------------------------+------+-------------+--+-------------+
| Trade and other receivables | | 62,512 | | 55,309 |
+-----------------------------+------+-------------+--+-------------+
| Derivative financial | | 15,906 | | - |
| instruments | | | | |
+-----------------------------+------+-------------+--+-------------+
| Biological assets | | 10,306 | | 138 |
+-----------------------------+------+-------------+--+-------------+
| Inventories | | 46,974 | | 18,176 |
+-----------------------------+------+-------------+--+-------------+
| | | 200,280 | | 209,223 |
+-----------------------------+------+-------------+--+-------------+
| TOTAL ASSETS | | 599,609 | | 529,058 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| NON CURRENT LIABILITIES | | | | |
+-----------------------------+------+-------------+--+-------------+
| Borrowings | | 45,322 | | 14,363 |
+-----------------------------+------+-------------+--+-------------+
| Derivative financial | | - | | 2,220 |
| instruments | | | | |
+-----------------------------+------+-------------+--+-------------+
| Deferred income tax | | 86,084 | | 67,398 |
| liabilities | | | | |
+-----------------------------+------+-------------+--+-------------+
| | | 131,406 | | 83,981 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| CURRENT LIABILITIES | | | | |
+-----------------------------+------+-------------+--+-------------+
| Borrowings | | 13,105 | | 5,326 |
+-----------------------------+------+-------------+--+-------------+
| Trade and other payables | | 25,243 | | 11,273 |
+-----------------------------+------+-------------+--+-------------+
| Derivative financial | | - | | 24,786 |
| instruments | | | | |
+-----------------------------+------+-------------+--+-------------+
| Current income tax | | 34,492 | | 11,739 |
| liabilities | | | | |
+-----------------------------+------+-------------+--+-------------+
| Dividends payable | | - | | 21,479 |
+-----------------------------+------+-------------+--+-------------+
| | | 72,840 | | 74,603 |
+-----------------------------+------+-------------+--+-------------+
| TOTAL LIABILITIES | | 204,245 | | 158,584 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| NET ASSETS | | 395,363 | | 370,474 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| SHAREHOLDERS' EQUITY | | | | |
+-----------------------------+------+-------------+--+-------------+
| Issued capital | | 124,879 | | 124,879 |
+-----------------------------+------+-------------+--+-------------+
| Other reserves | | 53,261 | | 10,579 |
+-----------------------------+------+-------------+--+-------------+
| Retained earnings | | 213,053 | | 231,801 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| | | 391,193 | | 367,259 |
+-----------------------------+------+-------------+--+-------------+
| Minority interest in equity | | 4,170 | | 3,215 |
+-----------------------------+------+-------------+--+-------------+
| | | | | |
+-----------------------------+------+-------------+--+-------------+
| TOTAL EQUITY | | 395,363 | | 370,474 |
+-----------------------------+------+-------------+--+-------------+
Consolidated Statement of Changes in Equity (Unaudited)
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| | | Attributable to equity holders of the Company | | | | |
+----------------------+-----+----------------------------------------------------------------+--+-----------+--+-------------+
| | | Issued | | Other | | Retained | | | | Minority | | Total |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| | | Capital | | Reserves | | Earnings | | Total | | Interest | | Equity |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Consolidated | | USD'000 | | USD'000 | | USD'000 | | USD'000 | | USD'000 | | USD'000 |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Balance at 1 January | | 9,440 | | 7,127 | | 174,368 | | 190,935 | | 3,182 | | 194,117 |
| 2007 | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Cashflow hedges net | | - | | (15,184) | | - | | (15,184) | | - | | (15,184) |
| of tax | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Currency translation | | - | | 18,636 | | - | | 18,636 | | - | | 18,636 |
| differences | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Net | | - | | 3,452 | | - | | 3,452 | | - | | 3,452 |
| income recognised | | | | | | | | | | | | |
| directly in equity | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Net profit for the | | - | | - | | 86,940 | | 86,940 | | 33 | | 86,973 |
| year | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Total recognised | | - | | 3,452 | | 86,940 | | 90,392 | | 33 | | 90,425 |
| income and expense | | | | | | | | | | | | |
| for 2007 | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Net proceeds from | | 115,397 | | - | | - | | 115,397 | | - | | 115,397 |
| issuance of ordinary | | | | | | | | | | | | |
| shares | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Shares issued for | | 42 | | - | | - | | 42 | | - | | 42 |
| land rights | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Dividends declared | | - | | - | | (29,507) | | (29,507) | | - | | (29,507) |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Balance at 31 | | 124,879 | | 10,579 | | 231,801 | | 367,259 | | 3,215 | | 370,474 |
| December 2007 | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Cashflow hedges net | | - | | 29,579 | | - | | 29,579 | | - | | 29,579 |
| of tax | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Currency translation | | - | | 13,103 | | - | | 13,103 | | - | | 13,103 |
| differences | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Net | | - | | 42,682 | | - | | 42,682 | | - | | 42,682 |
| income recognised | | | | | | | | | | | | |
| directly in equity | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Net profit for the | | - | | - | | 21,245 | | 21,245 | | 955 | | 22,200 |
| year | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Total recognised | | - | | 42,682 | | 21,245 | | 63,927 | | 955 | | 64,882 |
| income and expense | | | | | | | | | | | | |
| for 2008 | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Dividends declared | | - | | - | | (39,993) | | (39,993) | | - | | (39,993) |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| Balance at 31 | | 124,879 | | 53,261 | | 213,053 | | 391,193 | | 4,170 | | 395,363 |
| December 2008 | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
| | | | | | | | | | | | | |
+----------------------+-----+-------------+--+-------------+--+-------------+--+-------------+--+-----------+--+-------------+
Consolidated Statement of Cash Flows (Unaudited)
+---------------------------------+------+--------------+--+--------------+
| | | Consolidated |
+---------------------------------+------+--------------------------------+
| | | 2008 | | 2007 |
+---------------------------------+------+--------------+--+--------------+
| | | USD'000 | | USD'000 |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| CASH FLOW FROM OPERATING | | | | |
| ACTIVITIES | | | | |
+---------------------------------+------+--------------+--+--------------+
| Cash receipts from customers | | 351,180 | | 204,138 |
+---------------------------------+------+--------------+--+--------------+
| Cash payments to suppliers and | | (222,113) | | (136,787) |
| employees | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | 129,067 | | 67,351 |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| Income tax paid | | (4,688) | | (2,820) |
+---------------------------------+------+--------------+--+--------------+
| Interest paid | | (1,606) | | (1,214) |
+---------------------------------+------+--------------+--+--------------+
| Interest received | | 3,860 | | 62 |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| Net cash generated from | | 126,633 | | 63,379 |
| operating activities | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| CASH FLOW FROM INVESTING | | | | |
| ACTIVITIES | | | | |
+---------------------------------+------+--------------+--+--------------+
| Acquisition of subsidiary, net | | (63,391) | | - |
| of cash acquired | | | | |
+---------------------------------+------+--------------+--+--------------+
| Purchase of property, plant and | | (52,169) | | (24,750) |
| equipment | | | | |
+---------------------------------+------+--------------+--+--------------+
| Expenditure on plantation | | (13,456) | | (9,375) |
| development | | | | |
+---------------------------------+------+--------------+--+--------------+
| Expenditure on biological | | (697) | | (1,010) |
| assets | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| Net cash used in investing | | (129,713) | | (35,135) |
| activities | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| CASH FLOW FROM FINANCING | | | | |
| ACTIVITIES | | | | |
+---------------------------------+------+--------------+--+--------------+
| Proceeds from borrowings | | 1,318 | | 3,973 |
+---------------------------------+------+--------------+--+--------------+
| Repayment of borrowings | | (3,892) | | (993) |
+---------------------------------+------+--------------+--+--------------+
| Net proceeds from share issue | | - | | 116,094 |
+---------------------------------+------+--------------+--+--------------+
| Dividends paid to company | | (61,472) | | (10,524) |
| shareholders | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| Net cash generated from | | (64,046) | | 108,550 |
| financing activities | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| NET INCREASE/(DECREASE) IN CASH | | (67,126) | | 136,794 |
| AND CASH EQUIVALENTS AND BANK | | | | |
| OVERDRAFTS | | | | |
+---------------------------------+------+--------------+--+--------------+
| Effects of exchange rate | | (9,292) | | 749 |
| changes on cash and cash | | | | |
| equivalents and bank overdrafts | | | | |
+---------------------------------+------+--------------+--+--------------+
| Add : Cash and cash equivalents | | 131,281 | | (6,262) |
| and bank overdrafts at the | | | | |
| beginning of the year | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
| CASH AND CASH EQUIVALENTS AND | | 54,863 | | 131,281 |
| BANK OVERDRAFTS AT THE END OF | | | | |
| THE YEAR | | | | |
+---------------------------------+------+--------------+--+--------------+
| | | | | |
+---------------------------------+------+--------------+--+--------------+
Reconciliation of Profit After Income Tax To Net Cash Generated From Operating
Activities (Unaudited)
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
| | Consolidated |
+--------------------------------------+--------------------------------------+
| | 2008 | | 2007 |
+--------------------------------------+-------------+----------+-------------+
| | USD'000 | | USD'000 |
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
| Profit after income tax | 22,200 | | 86,973 |
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
| Add/(less) non-cash items: | | | |
+--------------------------------------+-------------+----------+-------------+
| Depreciation and amortisation | 20,143 | | 14,650 |
+--------------------------------------+-------------+----------+-------------+
| Biological (gain)/loss | 77,476 | | (39,702) |
+--------------------------------------+-------------+----------+-------------+
| Net exchange differences | 9,292 | | (749) |
+--------------------------------------+-------------+----------+-------------+
| Exchange differences on translation | 1,354 | | 3,809 |
| of financial statements | | | |
+--------------------------------------+-------------+----------+-------------+
| Share of profit from joint venture | (3,505) | | (3,191) |
+--------------------------------------+-------------+----------+-------------+
| Deferred income tax | (22,485) | | 13,474 |
+--------------------------------------+-------------+----------+-------------+
| Gain on disposal of non current | - | | (171) |
| assets | | | |
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
| Add/(less) movements in working capital items (excluding effects of |
| acquisition) |
+-----------------------------------------------------------------------------+
| (Increase)/decrease in trade and | 43 | | (27,373) |
| other receivables | | | |
+--------------------------------------+-------------+----------+-------------+
| Increase in current income tax | 22,753 | | 14,435 |
| liabilities | | | |
+--------------------------------------+-------------+----------+-------------+
| Increase/(decrease) in trade and | (2,987) | | 2,663 |
| other payables | | | |
+--------------------------------------+-------------+----------+-------------+
| (Increase)/decrease in inventories | 2,349 | | (1,439) |
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
| Net cash generated from operating | 126,633 | | 63,379 |
| activities | | | |
+--------------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------------+-------------+----------+-------------+
Notes to the financial statements
1. Basis of accounts preparation
The financial information in this statement is prepared in accordance with
International Financial Reporting Standards ("IFRS") (and International
Financial Reporting Interpretations Committee ("IFRIC") interpretations).
They have been prepared on the basis of the accounting policies set out in the
Group's 2007 Annual Report and Accounts and have been consistently applied
throughout the year.
2. Status of financial information
This preliminary announcement does not constitute the Group's consolidated
statutory financial statements for the year ended 31 December 2008. This report
is based on the accounts which are in the process of being audited and which
will be approved by the Board and reported on by the auditors on 20 March 2009
and subsequently sent to shareholders and filed with the PNG Registrar of
Companies. Accordingly, the financial information contained in this announcement
is unaudited and does not have the status of statutory accounts.
Financial information for the year ended 31 December 2007 has been extracted
from the audited financial statements as filed with the PNG Registrar of
Companies. The Auditors' report on the full financial statements for the year
ended 31 December 2007 was unqualified.
3. Reconciliation of reported Profit before tax
+--------------------------------+--+------------+--+-------------+---+
| | | Consolidated | |
+--------------------------------+--+-----------------------------+---+
| | | 2008 | | 2007 | |
+--------------------------------+--+------------+--+-------------+---+
| | | USD'000 | | USD'000 | |
+--------------------------------+--+------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| Profit before tax | | 28,805 | | 121,584 | |
+--------------------------------+--+------------+--+-------------+---+
| Net (gain)/loss arising from | | 77,476 | | (39,702) | |
| changes in fair value of | | | | | |
| biological assets | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| Profit before tax excluding | | 106,281 | | 81,882 | |
| the effects of revaluing | | | | | |
| biological assets under IAS 41 | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| Effect of acquisition of Ramu | | 4,689 | | - | |
| Agri-Industries Limited | | | | | |
| ("RAIL") | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| Net foreign exchange | | 15,289 | | (2,355) | |
| losses/(gains) | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+------------+--+-------------+---+
| Profit before tax excluding | | 126,259 | | 79,527 | |
| the effects of revaluing | | | | | |
| biological assets under IAS | | | | | |
| 41, excluding the effects of | | | | | |
| the acquisition of Ramu | | | | | |
| Agri-Industries Limited | | | | | |
| ("RAIL") and excluding net | | | | | |
| foreign exchange losses | | | | | |
+--------------------------------+--+------------+--+-------------+---+
4. Earnings per share
+--------------------------------+--+-------------+--+-------------+---+
| | | Consolidated | |
+--------------------------------+--+------------------------------+---+
| | | 2008 | | 2007 | |
+--------------------------------+--+-------------+--+-------------+---+
| | | USD'000 | | USD'000 | |
+--------------------------------+--+-------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| Net profit attributable to | | 21,245 | | 86,940 | |
| ordinary shareholders used in | | | | | |
| basic and diluted EPS | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| Net (gain)/loss arising from | | 53,590 | | (28,173) | |
| changes in fair value of | | | | | |
| biological assets attributable | | | | | |
| to ordinary shareholders, net | | | | | |
| of tax (*) | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| Net profit attributable to | | 74,835 | | 58,767 | |
| ordinary shareholders before | | | | | |
| changes in fair value of | | | | | |
| biological asset | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| Weighted average number of | | 144,799 | | 144,799 | |
| ordinary shares ('000) used in | | | | | |
| basic and diluted EPS | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| Basic EPS (USD/share) | | 0.147 | | 0.600 | |
+--------------------------------+--+-------------+--+-------------+---+
| Basic EPS before changes in | | 0.517 | | 0.406 | |
| fair value of biological | | | | | |
| assets (USD/share) | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
| | | | | | |
+--------------------------------+--+-------------+--+-------------+---+
+-----------------------------------------------------------------------+----------+----------+----------+
| * The net (gain)/loss arising from changes in fair value of biological assets attributable to ordinary |
+--------------------------------------------------------------------------------------------------------+
| shareholders, net of tax is reconciled to the income statement as | | | |
| follows: | | | |
+-----------------------------------------------------------------------+----------+----------+----------+
+-------------------------------+--+-------------+---+-------------+
| Net (gain)/loss arising from | | 77,476 | | (39,702) |
| changes in fair value of | | | | |
| biological assets | | | | |
+-------------------------------+--+-------------+---+-------------+
| Income tax expense/(credit) | | (23,243) | | 11,911 |
+-------------------------------+--+-------------+---+-------------+
| | | 54,233 | | (27,791) |
+-------------------------------+--+-------------+---+-------------+
| Attributable to: | | | | |
+-------------------------------+--+-------------+---+-------------+
| Ordinary shareholders | | 53,590 | | (28,173) |
+-------------------------------+--+-------------+---+-------------+
| Minority interest | | 643 | | 382 |
+-------------------------------+--+-------------+---+-------------+
| | | 54,233 | | (27,791) |
+-------------------------------+--+-------------+---+-------------+
| | | | | |
+-------------------------------+--+-------------+---+-------------+
5. Tax Note
+--------------------------------+-------------+----------+-------------+
| | Consolidated |
+--------------------------------+--------------------------------------+
| | 2008 | | 2007 |
+--------------------------------+-------------+----------+-------------+
| | USD'000 | | USD'000 |
+--------------------------------+-------------+----------+-------------+
| Income Tax Expense | | | |
+--------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------+-------------+----------+-------------+
| Current tax | 29,328 | | 21,256 |
+--------------------------------+-------------+----------+-------------+
| Deferred tax (credit)/charge | (22,485) | | 13,474 |
+--------------------------------+-------------+----------+-------------+
| Over provision in prior years | (238) | | (119) |
+--------------------------------+-------------+----------+-------------+
| | 6,605 | | 34,611 |
+--------------------------------+-------------+----------+-------------+
| The income tax expense has | | | |
| been calculated as follows: | | | |
+--------------------------------+-------------+----------+-------------+
| Profit for the year | 28,805 | | 121,584 |
+--------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------+-------------+----------+-------------+
| Income tax at 30% | 8,642 | | 36,475 |
+--------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------+-------------+----------+-------------+
| Tax effect of permanent | | | |
| differences: | | | |
+--------------------------------+-------------+----------+-------------+
| Non-deductible/(assessable) | (1,799) | | (1,746) |
| items | | | |
+--------------------------------+-------------+----------+-------------+
| Over provision in prior years | (238) | | (119) |
+--------------------------------+-------------+----------+-------------+
| Income tax expense | 6,605 | | 34,611 |
+--------------------------------+-------------+----------+-------------+
| | | | |
+--------------------------------+-------------+----------+-------------+
6. Exchange rates
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates. The consolidated financial information is presented in US
Dollars, which is New Britain Palm Oil Limited's presentation currency and
differs from its functional currency, the Papua New Guinea Kina ("PNG Kina").
The balance sheets and statements of changes in equity are translated from PNG
Kina to US Dollars at the closing rate existing at the date of the balance
sheet, which at 31 December 2008 is PGK1.00 = USD 0.3760 (31 December 2007: PGK
1.00 = USD 0.3580).
The income statements and statements of cash flows are translated from PNG Kina
to US Dollars at the average exchange rates prevailing during the period, which
are considered to approximate the actual exchange rate at the date of each
transaction. The average exchange rate at 31 December 2008 is PGK1.00 = USD
0.3766 (31 December 2007: PGK 1.00 = USD 0.3396).
7. Dividends
In January 2008, an interim dividend for 2007 was paid of 13.8 cents (41.7 toea)
per share, which was equivalent to a total amount of USD 21.5m. In July 2008, a
final dividend for 2007 was paid of 14 cents (37.83 toea) per share, which was
equivalent to a total amount of USD 20.9m.
In October 2008, an interim dividend for 2008 was paid of 14 cents (35.8 toea)
per share, which was equivalent to a total amount of USD 20.3m
It should be noted that exchange rate movements in the Kina/USD exchange rate
between the date of declaration and payment date give rise to exchange
differences.
A final dividend of 14 cents will be paid in May 2009.
8. Business Combinations
In September 2008, the Group acquired 100% of the share capital of Ramu
Agri-Industries. The acquired business contributed revenues of USD 19.7m and net
loss of USD 2.4m from 1 October 2008 to 31 December 2008.
Details of the provisional fair value of the assets and liabilities acquired are
as follows:
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| | | | | USD'000 | |
+--------+--------+--------+--------+-----------+-----------+
| Purchase consideration | | | |
+--------------------------+--------+-----------+-----------+
| - Cash paid | | | 61,629 | |
+-----------------+--------+--------+-----------+-----------+
| - Direct costs relating to the | 1,769 | |
| acquisition | | |
+-----------------------------------+-----------+-----------+
| Total purchase | | 63,398 | |
| consideration | | | |
+--------------------------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| | | | | USD'000 |
+--------+--------+--------+--------+-----------------------+
| | | | | Fair | Carrying |
| | | | | value | amt |
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| Cash and cash | | 7 | 7 |
| equivalents | | | |
+--------------------------+--------+-----------+-----------+
| Trade and other | | 7,246 | 9,699 |
| receivables | | | |
+--------------------------+--------+-----------+-----------+
| Inventories | | | 27,227 | 21,700 |
+-----------------+--------+--------+-----------+-----------+
| Biological | | | 14,756 | 13,130 |
| assets | | | | |
+-----------------+--------+--------+-----------+-----------+
| Property, plant & | | 93,809 | 71,801 |
| equipment | | | |
+--------------------------+--------+-----------+-----------+
| Investments | | | 0 | 475 |
+-----------------+--------+--------+-----------+-----------+
| Borrowings | | | (38,548) | (38,545) |
+-----------------+--------+--------+-----------+-----------+
| Trade and other payables | | (16,957) | (16,817) |
+--------------------------+--------+-----------+-----------+
| Deferred tax liabilities | | (24,142) | (16,756) |
+--------------------------+--------+-----------+-----------+
| | | | | 63,398 | 44,695 |
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| Total purchase | | 63,398 | |
| consideration | | | |
+--------------------------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| | | | | | |
+--------+--------+--------+--------+-----------+-----------+
| Purchase consideration settled in | 63,398 | |
| cash | | |
+-----------------------------------+-----------+-----------+
| Cash and cash equivalents in | (7) | |
| subsidiary | | |
+-----------------------------------+-----------+-----------+
| Cash outflow on | | 63,391 | |
| acquisition | | | |
+--------+--------+--------+--------+-----------+-----------+
The fair values are provisional as the acquisition was completed with effect
from 29 September 2008. Provisional fair values may be used for a period of 12
months from acquisition.
During the 12 month period from acquisition date an independent valuer will
complete a detailed valuation of the land acquired to determine the final fair
value of these assets. Utilising the independent valuers report the company
will determine the final allocation of the excess across property, plant and
equipment, intangible assets, deferred tax assets and liabilities, the outcome
of which could materially change the provisional fair values identified above.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SEASWWSUSESE
|