Agriterra Ld Share Discussion Threads

[opaldouglas] 11/5/2013 14:28

Oiht, many thanks for link.

Count - No link unfortunately but if you message me your email I'll happily send it over. Otherwise contact Susie Geliher at St Brides Media & Finance who will no doubt be happy to send you a copy.

OD

[oiht] 11/5/2013 10:22

Lifted from LSE: Agriterra used as a case study:

[the count of monte_cristo] 10/5/2013 18:39

Hi Opal - do you have a link to the MC Peat & Co document?

Kind regards, The Count

[opaldouglas] 10/5/2013 16:48

Agriterra's cocoa expansion shows its African growth ambitions
By Giles Gwinnett

May 10 2013, 3:44pm From initially building what was primarily a cocoa trading business, it now has bought its own 1,200 hectare plantation in Sierra Leone and earlier this month, unveiled a large scale acceleration of efforts.

Pan African food producer Agriterra's (LON:AGTA) recent expansion of its cocoa farming efforts is a good example of the firm's current focus on investment, now in full swing.

The firm is looking to build the foundation on which it grows and is pumping resources and funds into its core operations.

From initially building what was primarily a cocoa trading business, it now has bought its own 1,200 hectare plantation in Sierra Leone and earlier this month, unveiled a large scale acceleration of efforts.

Clearing the site is ongoing and Agriterra expects to have planted the whole 1,200 hectare by the fourth quarter of next year.

Meanwhile, subsidiary Tropical Foods is in "advanced" negotiations to try and get its hands on a further 1,600 hectares north east of the current site to allow planting in 2016 and an additional 1,550 hectares to the south-east, which will be earmarked for coffee.

To support the plantation's development, a new cocoa nursery is also being planned.

Agriterra's chief executive Andrew Groves tells Proactive the aim is to secure 6,000 hectares in the next three years and is in no doubt that the scheme bolsters the group's long term position.

"We are now the largest agri business in Mozambique - with the milling and the beef. We wanted to expand into something, which over time has good long term cash flow, which is cocoa," he says.

"We can forward sell it. There's a massive off-take market and if you have your own plantation, it's like an annuity from a cash flow point of view."

The plantation gives the firm secure cash flow in the next three-four years, he adds.

And the timing couldn't be better. The company pointed out in its last statement that the International Cocoa Organisation forecasts demand for cocoa will exceed production by 45,000 tonnes in the season to September 2013.

Agriterra's expansion strategy into its core revenue generating businesses of cocoa, beef and maize was also given a shot in the arm earlier this year - with a US$28 million payout.

It came from Marathon Oil Corporation after the sale of Agriterra's 20% legacy interest in the South Omo oil block in Ethiopia and leaves the firm in the enviable position of having no debt and a growing asset base - its net asset value now stands at US$64.5 mln.

Meanwhile, its Mozbife operation in Mozambique is making great strides and is now eyeing a national chain of butchers shops servicing its expanding cattle herd - which aims to have a head count of 10,000 by 2015.

The firm has now a finished abattoir in Chimoio and to boost its margins, has opened two shops - one in Chimoio and one in Tete selling beef produce.

Another four retail units are scheduled to open this year, Groves tells Proactive, while the firm is hoping to roll out 20 butchers shops across the country, which should really boost the group's top line.

The third revenue stream - the group's maize and milling operation - is also doing well.

It saw improved revenues in 2012 after reduced sales in 2011 after a strong harvest reduced demand.

For the six months to November 30 last year, the group saw revenue from continuing operations shoot up to US$11.49mln from US$5.29mln the year before, with revenue for the year to May 31, 2012 coming in at around US$13 million.

And Groves is confident that 2013 results will tell the same story.

"I think we are extremely undervalued. We've got no debt. We've got a huge asset base and business is growing," he added.

The chief executive also pointed out that as Africa itself grows on the world stage, economically and socially, Agriterra could not be in a better place to capitalise.

"If you look at the rest of the world, there's a declining economy whereas if you look at the African states, it's different. Mozambique's pushing 11/12% growth, Sierra Leone's got huge growth, most of them have (the states)- and it's not leveraged growth - it's cash growth, which makes a big difference.

"I think it's the place to be. You've got a fast-growing consumer market and it keeps increasing," he says, also highlighting the oil and gas discovered in Mozambique along with coal.

"In the last ten years, Africa has changed completely and I think Agriterra's a good foundation to capitalise on that."

To that end, Groves says the company is always on the lookout for further acquisitions, though nothing has as yet come "across the radar".

"We'd look at further acquisitions but they've got to be earnings accretive. We're not going to go into too much greenfield stuff where we've got to plough $10/$20 mln into greenfield business but if we can buy an earnings-accretive business and finance it with cheap debt we'd probably look at doing that."

So there is much to look forward to as Agriterra continues to grow and furthers its reach into Africa's food production business.

[opaldouglas] 09/5/2013 21:33

tenapen, certainly agree with the long hold stance. Based solely on my post above I've classed AGTA as a buy and have voted with my recent purchase.

The above doesn't include CAPEX which is due to peak this year at $9.04m, falling to $6.14m in 2014 and subsequently $3.72m & $2.76m in 2015 & 2016.

MC Peat & Co have gross revs forecast at:

2012 - $13.8m
2013 - $26.9m
2014 - $36.0m
2015 - $46.8m
2016 - $53.2m

Which certainly shows the potential upside!

Grain looks like a steady earner with circa $13m per year fore cast moving forward, whilst Beef/ranch increases significantly from $900k in 2012 to $24m in 2016 whilst Cocoa starts contributing this year at $3.2m moving to $16m in 2016. No revs are fore cast for palm oil activities to date.

[tenapen] 09/5/2013 18:50

Good thinking Douglas,
I have agta down as a long term hold and such have it as 'fairly priced / a hold". Any further money in will be a bonus but untill such times .... !. More important or me is the hope that the oiler's have now sold out and the present holders are happy with agta being a slow moving Agriculture company.

Good Luck.

[opaldouglas] 09/5/2013 18:11

Tenapen/Oiht,

My two penneth worth... with a market cap of £27m and circa £20m in the bank the market is currently valuing AGTA around the £7m mark all in. Is AGTA fair value at £7m? well this is obviously open to debate but of a more immediate importance is compensation payments/tax reclaim & possible cash injection from a commercial oil discovery via Marathon Oil.

Firstly, £11m compensation payment from south Sudan would take cash upto circa £31m (£4m above current mcap).

Secondly, how much of the $12m logged with Ethiopian government will AGTA get to see? This of course depends on money spent in White Nile days which I haven't looked into. So on a best case scenario the full $12m, realistically I don't expect this but that could be a further £8m in the coffers taking cash upto £39m (£12m above current mcap).

And thirdly! Should marathon hit oil (at commercial levels a further $10 is due, say £5m after tax etc which could take cash to £44m (£17m above current mcap). Take note I've mixed $/£ purposefully.

With £44m in the bank and valuing AGTA at current £7m estimate a potential mcap could be in excess of £50m with should indicate a shareprice near double todays price.

Obviously this is best case scenario and no further cash payments may be issued if Ethiopian government pull a fast one and marathon oil don't have any success whilst drilling.

So whilst trying to put some meat on the bones the upside is near double if cash rolls in and otherwise AGTA are currently fairly priced at £7m... which is a whole different debate (one that I'm still having with myself).

OD

[gerri-c] 09/5/2013 14:25

Mozambican agricultural production expected to recover from floods
May 9th, 2013 News
Agricultural production in Mozambique is expected to see a rapid recovery following destruction of some crops and infrastructure due to flooding at the beginning of the year, according to the International Monetary Fund (IMF).

The head of an IMF mission that ended a visit to Mozambique Wednesday, said that as well as losses to the agricultural sector, exports of coal and other products had come to a standstill because of damage to railway lines, which led to the country losing income.

In the same period imports had to be increase, particularly of food and fuel, which meant that the Bank of Mozambique had to use a considerable part of its reserves to import goods when there were delays in paying out foreign aid to Mozambique.

"However, the Mozambican economy remains robust, despite the still fragile global climate resulting from the financial crisis that has rocked the international economy. We calculate that real gross domestic product (GDP) growth totalled 7.5 percent in 2012, which is one of the highest in the world and the region, reflecting the expansion and rapid increase in coal production as well as financial services, transport and communications and agriculture," said Doris Ross. (macauhub)

[oiht] 09/5/2013 09:22

Can't answer your questions opal but you rightly state that the Sudan money is due by the 25th. We'll just have to watch this space.

[tenapen] 08/5/2013 19:39

We should be told of the payments as AGTA receive them ! or they may just add the info to the interims / final results, which ever comes next !.

Other than that its going to be a long hold and fingers crossed.

[opaldouglas] 08/5/2013 19:24

Has anyone taken the time to fully digest Peat & Co initiation report for AGTA issued at the back end of last year? All 80 odd pages!

Incredibly frustrating to put a value to this one given the number of operations currently planned/ongoing. Nevertheless I've recently taken a stake.

Questions for the regulars, is the £11M compensation payment from South Sudan still due to land by 25th of this month?

And of the $12M logged with Ethiopian government following payment from Marathon Oil how much Costs incurred can ATGA realistically offset against tax? (I appreciate this goes back to White Nile days!)

Ta,

OD

[tenapen] 08/5/2013 06:04

O/T agta



Africa is 'the Brazil of the 1970s' in agriculture

Is sub-Saharan Africa, in agriculture, the Brazil of the 1970s?

Cont...

[oiht] 27/4/2013 15:49

This video will whet your African appetite. You'll need to scroll down to the
'Africa special' link

[gerri-c] 27/4/2013 09:24

Such is the way in reading a chart. I see we hit a bottom and have potentially begun to turn. Increased volume from here wouldn't hurt of course.

[iantrader2] 26/4/2013 13:12

If that were the case every day would be significant - look at the graph above

[gerri-c] 26/4/2013 10:20

Something of a significant move here today.....

[stable] 24/4/2013 19:19

Perhaps he is one of the group trying to drop the price of the shares, or perhaps he is just ignorant of the availabilty of info on ADVFN.

[jimmy12345] 24/4/2013 10:41

Old news of 0.7 % share issue. Why post again?

[lucky_punter] 24/4/2013 09:44

Agriterra (LON:AGTA)
Agriterra, the pan-African agricultural company, announces that pursuant to the agreement announced on 17 January 2013 regarding the acquisition of a further 2,500 hectares of farmland to expand the Company's cattle ranching operations in Mozambique, the Company is issuing 2.1m new ordinary shares as partial consideration. The acquisition is in line with the Company's strategy to expand its beef herd, which currently stands at 6,213 across the 2,350 hectare Mavonde Stud Ranch and the 15,000 hectare Dombe Ranch.

[jimmy12345] 23/4/2013 14:21

On the share price im beginning to thing there was some kind of mistake when it went up 17% at 4.30 the other day then the next session dtopped the same amount when opening. Must have been a correction.

[jimmy12345] 23/4/2013 14:19

Anyone have a name and even a picture or two of the butcher shops ? Would be of intrest to see what kind of operation they ate.Found this article about tete, its boom city, lot of hungry mouths to feed, and lots of inflows of workers and money. With shops and hotels ect opening up everywhere. This all looks well for a supplier of agricultural products like ourselves.http://www.bbc.co.uk/news/world-africa-22015732

[freddie01] 22/4/2013 11:30

Anyone explain why this appears to be so unloved? It looks promising to me.