|VSA broker note
With the buyer being a domestic entity (Queensland Investment Corporation) we expected completion of this transaction to complete without any major issues. This transaction provides MPE with net proceeds of cUS$65m, which places it at a significant advantage over many of its highly leveraged peers in the palm oil sector, especially as it was already operating in a net cash position (US$11.5m net cash as of 31 December 2015). It is also worth noting that future disposals of its residual Malaysian interests could deliver an additional US$45m+ (before deal costs) to the group.
|Nice to see sale of NAPCo complete|
|"Strong growth profile based on historical planting rates. 2015 was a tough year due to weak CPO price and El Nino, factors which should ease in 2016 leading to strong resumption of growth."
finnCap update: Https://www.research-tree.com/Company/GB0007538100|
|Underperformance of London-listed palm oil groups relative to their Asian peers and the prospects for takeovers. MPE gets a mention:
|With the recent sell off and share price fall followed by a rebound in both Palm Oil & Cattle Prices this is starting to look interesting especially with take-over activity still high in the sector. PEG is only 0.57, and limited borrowing
Recent IC Article -- EIGHT GENUINE GROWTH BUYS
While palm oil producer MP Evans (MPE) has made it past the Genuine Growth screen's 3-month rising-forecasts test, the most recent revisions to brokers predictions have been downward due to weather-related woes. However, other external factors have put a more positive shine on the company's shares, namely the takeover of rival New Britain Palm Oil at an 85 per cent premium to its share price prior to the bid.
Broker Peel Hunt points out that the $20,000 per hectare value put on New Britain's plantations compares with a valuation of about $10,000 per hectare currently being applied to MP Evans' land. What's more, the New Britain bid is just the latest takeover in a wave of consolidation sweeping the sector. Spinning off an Australian cattle business could also aid sentiment towards Evans and the long-term outlook for its young estate is encouraging despite recent weather-related set backs.
Last IC View: Buy, 440p, 23 October 2014|
|For those of you interested and investing in the world's need to increase food production you may do much worse than have a look at Plant Impact. They have no debt, their research and development is going well and about to become profitable. I am not ramping just suggesting that you have a look at their forward plans. Happy investing MW|
|looks overpriced to me...|
|Just an update, found that Chairman Peter Hadsley-Chaplin has done an interview detailing the results:
|I notice that the Australian operations have no made a loss 5 yrs in a row.At one point they were up for sale , no mention any more.Is it time for management to make a slash?
I don't hold here.|
|Questor weekend tip - video
|First time in a long time I can remember spread being so tight. This will blow tomorrow
700p next week for sure.|
|Expecting another set of bumper numbers tomorrow. Could even see a rise to 600p|
|Prospects look good for the foreseeable future:
"Palm-oil prices were on a downward trend for most of 2011, albeit still at historically-high levels, but there has been a sharp upturn in the first part of 2012 to the current level of around US$1,175 per tonne (Rotterdam cif). With weather concerns in South America affecting sentiment in respect of soybean oil, competition for land between corn and soybeans in the US and an upturn in demand for vegetable oils, price prospects in the short term appear to be encouraging.
F.f.b. crops have made a good start in 2012, with 66,500 tonnes harvested from the majority-owned estates up to 31 March 2012, a 20% increase over the same period last year. The Group remains on track to produce 300,000 tonnes of f.f.b. in 2012. The new mill is performing well and additional sales value is being captured.
Cattle prices have eased from the higher levels seen in 2011, but nonetheless remain at historically-firm levels. Growing demand in Asia and the continuing decline of the US cattle herd would indicate that the medium-to-long-term outlook for Australian beef-cattle markets remains positive."|
|The price jump at the end of yesterday, might suggest that todays good set of results had leaked.|
|Does anyone know why these fell so sharply today?|
|EPS up 90% has not been reflected in the share price.
But I did not like the pledge of bank deposits as collateral for coop debt.|
|Palm oil is cheap , has a higher yield per hectare than any other vegetable oil and has a long shelf life , but compared to most other vegetable oils , it is more highly saturated.I feel uncomfortable investing in something that isn't good for humanity.It has little to redeem it .
I realise there are counterarguements about job creation and feeding the world, but I shan't invest here.Anybody who believes that palm oil might be healthy is being confused by the Palm Oil industry.|
|The first 52 trades this am appear to have all been Sells - an unusual pattern even in a falling market.Spread is wide at 29p.|
Date Rec Pre-tax (£) EPS (p) DPS (p) Pre-tax (£) EPS (p) DPS (p)
08-07-11 BUY 19.67 25.46 4.52 14.60 20.03 4.5
PG are predicting a fall to £14.6M pre-tax next year.Maybe I am missing something.
Palmoil price is down a little this last couple of months , but the forecasts aren't dipping.|
|Comment from Agrimoney on to-days results:
MP Evans flags snags to Indonesia palm expansion
MP Evans highlighted the increasing difficulty of expanding oil palm plantations in Indonesia even as the group revealed that previous development had fuelled a more-than doubling in full-year profits.
The London-listed group reported earnings of $24.6m for 2010, excluding adjustments for the value of its plantations, a rise of 150%, helped by a rise in palm oil volumes as plantations come onstream, from an expansion drive started in 2005.
And, after developing some 10,900 hectares for itself over the five years, with an extra 4,200 for smallholder co-operatives, it said it "hoped" to continue developing plantings at a rate of 3,000 hectares a year.
"But this is by no means guaranteed," MP Evans said.
"Agreeing compensation terms with the local people, and settling other land-title issues on areas which the group plans to develop, is increasingly complicated and time-consuming."
It was "hard to determine" how much of the land covered by an official permit "will be available to be developed".
Initially, the group estimated that its permit would allow it to develop 24,000 hectares of land in East Kalimantan, in central Indonesia, for itself, plus a further 17,000 hectares in Bangka, with additional land available for co-operatives.
A year ago, the figures had dropped to 17,000 hectares and 7,000 hectares respectively, plus 8,200 hectares for co-operative use.
On Monday, MP Evans said that it believed that an extra 5,000 hectares would be available in East Kalimantan and 3,600 hectares in Bangka, plus a further 4,300 hectares for the co-operatives, prompting it to launch a search for "additional, environmentally-suitable land".
The comments come amid growing expectations that rapid growth in Indonesian oil palm plantations, which has driven the country to top rank in palm oil production, will slow, in part down to growing social and environmental concerns over the expansion.
Indonesian industry group Gapki sees the pace of plantation growth slowing to an annual pace of 150,000 hectares, from 400,000 hectares in the 1996-2006 period.
MP Evans said that, even without expansion, development already in place would lift its palm oil production from just under 200,000 tonnes last year to 300,000 tonnes n 2012 and 500,000 tonnes in 2015.
"These are very significant increases and, subject to palm-oil prices remaining at healthy levels, are likely to impact extremely favourably on the group's revenues in the near future."
And with world supplies of vegetable oils, "generally tight", and the outlook for demand "strong", prospects for palm oil prices "appear favourable for the short-to-medium term", the company said.
It also forecast better times for its Australian beef operations, NAPCo and Woodlands, both of which returned to profit last year, thanks to soaring cattle prices and the impact of rain in boosting pasture conditions.
"Cattle prices too look set to remain firm, in view of the continuing shortage of supply, not least since the size of the US herd has now diminished to its lowest level since 1958."
The data, including revenues up 48% at $42.1m, were well received by broker Panmure Gordon, which termed the results "solid", and restated a "buy" rating MP Evans shares, with a price target of 500p.
"Ongoing strong palm oil prices, supported by a constructive outlook for its Australian cattle operations, allow us to increase our forecasts for adjusted full-year earnings by 5% to 42 cents [a share]," Panmure analyst Damian McNeela said.
The shares stood unchanged at 432p in morning deals.|
|anybody any ideas where we are going|
|Yes but the floods have now moved...
Expect a new RNS shortly - long term I think MPE will recover.|
|But the company issued a rns on Jan 4 saying that the Australian properties were not affected by the floods - that, in fact the extra rainfall was beneficial......|
|Not a palm oil collapse, it's to do with the floods in Australia.|
|What a incredible drop today, Director bought 4000@490p yesterday and then this happens. Palm Oil price collapse?|