News Column

Anglo-Eastern Plantations Says Production Up So Far In 2014

June 2, 2014

Rowena Harris-Doughty

LONDON (Alliance News) - Anglo-Eastern Plantations PLC Monday said production of fresh fruit bunches and crude palm oil increased in the first four months of 2014, although it said new planting planning has been held back by land compensation negotiations with villagers.

In an annual general meeting statement to shareholders, Anglo-Eastern Plantations, which owns, operates and develops plantations in Indonesia and Malaysia, gave a cautious but confident outlook for trading in the remainder of the year.

"The board remains cautious but expects profitability and cash flow to remain in line with management forecasts for the remainder of 2014," the company said in a statement.

Anglo-Eastern Plantations said it produced 247,400 metric tonnes of fresh fruit bunches in the first four months ended April 30, up 18% on the previous year's 210,000 tonnes.

Fresh fruit bunches are the raw palm fruit processed to produce palm oil.

Fresh fruit bunches bought in was 194,600 tonnes, significantly higher than the 98,800 tonnes bought in for the same period last year.

Total crude palm oil produced was 89,200 tonnes it said, 38% higher than the 64,600 tonnes recorded a year earlier, which it said was due to higher volume of fresh fruit bunches processed by the five mills.

Anglo-Eastern Plantations said the crude palm oil price closed at USD875 per tonne as at May 29, a 2% fall from the start of the year.

"We anticipate that the crude palm oil price will remain generally stable due to the increase in demand from biodiesel and modest levels of industry output," the company said.

Anglo-Eastern Plantations said that new planting in the four month period was 582 hectares, up from 569 hectares a year earlier, although it said it planted less than planned due to delays in finalising agreement with villagers for land compensation payments in Bengkulu and Bangka.

"The villagers are asking for compensation beyond what the group considered fair and reasonable resulting in protracted negotiations," the company said in a statement.

The group also said that the earthworks for construction of the mill in Central Kalimantan are now almost completed, and the construction of mill buildings is progressing.

"This USD18 million mill with an initial capacity of 45 metric tonnes per hour is expected to be operational in second quarter of 2015," it said.

Anglo-Eastern Plantations also said that the construction of another mill in North Sumatra has been deferred while it considers further the relative cost advantages of two selected sites.

The group said its balance sheet remains strong, and it continues to achieve positive cash flow generation.

Anglo-Eastern Plantations shares were trading at 715.00 pence Monday morning, down 0.1% or 0.50 pence.

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Source: Alliance News

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