TIDMDKL
RNS Number : 4303E
Dekeloil Public Limited
04 July 2019
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.
DekelOil Public Limited / Index: AIM / Epic: DKL / Sector: Food
Producers
DekelOil Public Limited ('DekelOil' or the 'Company')
Half Year Production Update
DekelOil Public Limited, the West African focused agricultural
company, is pleased to report record second quarter and first half
production of crude palm oil ('CPO') at its 100%-owned, vertically
integrated palm oil project at Ayenouan in Côte d'Ivoire (the
'Project') for the three and six month periods ended 30 June 2019.
Albeit against soft 2018 comparators, this represents a 62% year on
year increase in CPO production to 14,013 tonnes in Q2 2019, which
contributed to a 30% increase in CPO volumes for the half year
period to 28,934 tonnes (H1 2018: 22,242 tonnes) and more than 7%
higher than the 26,947 tonnes produced in H1 2017.
Q2 2019 Q2 2018 Change H1 2019 H1 2018 Change
FFB collected (tonnes) 62,577 36,664 +70.7% 131,917 96,195 +37.1%
CPO production (tonnes) 14,013 8,637 +62.2% 28,934 22,242 +30.1%
CPO Sales (tonnes) 14,693 8,513 +72.6% 26,702 22,271 +19.9%
Average CPO price
per tonne EUR488 EUR544 -10.3% EUR505 EUR549 -8.0%
PKO production (tonnes) 953 834 +14.3% 1,896 1,793 +5.7%
PKO Sales (tonnes) 606 761 -20.4% 1,539 1,480 +4.0%
Average PKO price
per tonne EUR583 EUR798 -26.9% EUR589 EUR893 -34.0%
PKC production (tonnes) 1,249 974 +28.2% 2,525 2,197 +14.9%
PKC Sales (tonnes) 1,063 1,191 -10.7% 2,274 2,304 -1.3%
Average PKC price
per tonne EUR55 EUR50 +10.0% EUR55 EUR50 +10.0%
Production
-- 30% increase in H1 CPO production to a record 28,934 tonnes
(H1 2018: 22,242 tonnes) follows strong year on year improvement in
Q1 2019 and record Q2 performance:
o 62% increase in CPO produced in Q2 2019 to 14,013 tonnes
compared to 8,637 tonnes of CPO produced in Q2 2018
-- 37% increase in Fresh Fruit Bunches ('FFB') delivered to mill
in H1 to 131,917 tonnes (H1 2018: 96,195 tonnes), as yields
recovered to more normal levels after 2018's poor peak harvest
season and successful enhancement of logistics programme
o Includes 71%+ increase in FFB delivered to mill in Q2 2019 to
62,577 tonnes
-- Half year CPO extraction rate on FFB processed of 22.0% (H1
2018: 23.1%) but extraction rates have improved since May 2019
-- Record H1 PKO and Kernel Cake production compared to H1 2018
following successful strategy to acquire external kernels for
processing
Sales and Pricing
-- 20% increase in H1 CPO sales to 26,702 tonnes (H1 2018: 22,271 tonnes)
-- CPO stock on hand at period end stood at 3,000 tonnes, all of
which has been purchased and is due to be delivered and sold in Q3
2019
-- Significant quantities of kernels are also held for
processing including stock purchased as part of the continuation of
the successful strategy to purchase kernels from other mills - the
intention is to process this stock during the upcoming low
season
-- In line with international benchmarks trading at cyclical
lows, CPO pricing remains challenging
o CPO sales achieved at small premiums to global prices during
back end of peak season due to high local stock levels
o The Board expect CPO sales price premiums to increase to some
degree in the low season as local stocks of CPO subside
DekelOil Executive Director Lincoln Moore said: "A record second
quarter has combined with the strong rebound in year on year Q1 CPO
production to generate our best ever half yearly production
performance. This record result is not just down to the recovery
seen in FFB volumes harvested in the region following the poor
harvests in 2018, but also a positive reaction to the various
initiatives implemented by the Board across the Group's operations
last year. Should global CPO prices bounce off their current
cyclical lows, the Board is confident the combination of these
various factors will enable Ayenouan's profitability to increase
significantly.
"Independent of the cycle, we believe CPO prices stand to
benefit from positive structural drivers in the years ahead. While
demand growth for vegetable oil is forecast to remain consistently
strong, the addition of new supplies of palm oil, which is by far
the highest yielding vegetable oil per hectare, is slowing. Supply
growth in major producer Malaysia, for example, is almost at a
standstill. At some point, we anticipate global CPO pricing will
catch up with these market dynamics leading to an increase in
pricing. If or when this happens, this will have a positive impact
on the cash flows generated."
** ENDS **
For further information please visit the Company's website
www.dekeloil.com or contact:
DekelOil Public Limited
Youval Rasin
Shai Kol
Lincoln Moore +44 (0) 207 236 1177
Cantor Fitzgerald Europe (Nomad and
Joint Broker)
David Foreman
Richard Salmond +44 (0) 207 894 7000
VSA Capital (Joint Broker)
Andrew Monk (Corporate Broking)
Andrew Raca (Corporate Finance) +44 (0) 203 005 5000
Optiva Securities Limited (Joint Broker)
Christian Dennis
Jeremy King +44 (0) 203 137 1903
St Brides Partners Ltd (Investor Relations)
Frank Buhagiar
Cosima Akerman +44 (0) 207 236 1177
Notes:
DekelOil Public Limited is a multi-project, multi-commodity
agricultural company focused on West Africa. It has a portfolio of
projects in Cote 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 70,000tpa crude
palm oil mill; a cashew processing project in Tiebissou, which is
due to commence production in 2020; and a second palm oil project
in Guitry which is under development.
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END
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