Agriterra Ltd Update re. publication of accounts and trading (8135C)

TIDMAGTA

RNS Number : 8135C

Agriterra Ltd

12 February 2020

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

12 February 2020

Agriterra Ltd ('Agriterra' or the 'Company')

Agriterra Ltd / Ticker: AGTA / Index: AIM / Sector: Agriculture

Update re. publication of accounts and trading update

Agriterra Limited, the AIM-quoted African agricultural company provides a further update to shareholders regarding the delays in publication of the Company's audited annual report and accounts for the year ended 31 March 2019 (the 'Annual Accounts'), and the Company's unaudited interim report and accounts for the six month period ended 30 September 2019 (the 'Interim Accounts').

As noted in the Company's announcements on 30 September and 21 November 2019, due to an ongoing investigation into two incidents of theft at an operational level, the Company and its auditors were not able to finalise and release the Annual Accounts within the six month timeframe stipulated by AIM Rule 19 (being 30 September 2019).

Internal investigations launched on the back of identifying the thefts have enabled management to conclude that these were isolated incidents and that there is not a systemic issue. The total theft quantum identified through these investigations amounts to US$18,700, of which US$7,200 has been recovered, resulting in a net loss to the business of US$11,500. The thefts related to weighbridge transactions, following which management has taken steps to upgrade the weighbridge software and to acquire automatic grain movement scales to prevent future recurrence in line with the guidance set out in the announcement of 21 November 2019. Furthermore, the staff involved in these thefts have been dismissed and the Company continues its efforts to recover the remaining amounts stolen.

Despite the progress made by the internal investigation team, the Annual Accounts, and therefore also the Interim Accounts, remain unfinalised at the date of this announcement. The Company's auditors, BDO LLP ('BDO'), having consulted with forensic experts within BDO, have advised the Company that under the relevant auditing standards, in order for BDO to be able to sign off the Annual Accounts without disclaimer or qualification (in relation to these matters), they require further forensic assessment work (the 'Further Assessment') to be conducted by an accounting firm with forensic specialists, with sufficient independence, objectivity and expertise. Accordingly, in this context, the Company has appointed PKF Littlejohn LLP ("PKF") to undertake the Further Assessment and work together with BDO to finalise the Annual Accounts within a period estimated to be no longer than a month. Finalisation and publication of the Annual Accounts will also allow finalisation and publication of the Interim Accounts within a very short time frame thereafter.

As shareholders are aware, due to the delay in publishing the Annual Accounts (and the Interim Accounts), dealings in the Company's ordinary shares have been and will remain temporarily suspended from trading on AIM, until such time as the Annual Accounts and the Interim Accounts have been duly published in compliance with the AIM Rules for Companies.

Under the terms agreed with PKF and BDO, it is anticipated that the Annual Accounts and Interim Accounts will both be finalised and published by mid-March 2020, which will enable the ongoing trading suspension to be lifted.

Financial condition and trading update

The Group's cash balances and headroom under available facilities as at 31 December 2019 stood at US$638,000. The above exercise, excluding normal course audit fees, is expected to cost the Company approx. US$175,000. The Board is confident that through a combination of cash generated from operations, existing cash resources and undrawn facilities that it will have sufficient resources available to it to discharge its obligations for at least the next twelve months.

Trading for the year ended 31 March 2019 showed improved sales across both the Grain and Beef divisions and reduced operating losses. Trading for the current year ending 31 March 2020 is showing continued improvement from the Grain division, whilst the Beef division is currently trading marginally behind the prior year.

** ENDS **

For further information please visit www.agriterra-ltd.com or contact:

 
 Agriterra Ltd                               Strand Hanson Limited 
                                (Nominated & Financial Adviser and 
                                                           Broker) 
============================  ==================================== 
 Caroline Havers                    James Spinney / Ritchie Balmer 
 [e-mail]                   [phone] 
 

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February 12, 2020 10:37 ET (15:37 GMT)